[Senate Report 104-244]
[From the U.S. Government Publishing Office]
104th Congress Report
SENATE
2d session 104-244
_______________________________________________________________________
Calendar No. 349
OFFICE OF GOVERNMENT ETHICS AUTHORIZATION ACT OF 1996
__________
R E P O R T
of the
COMMITTEE ON GOVERNMENTAL AFFAIRS UNITED STATES SENATE
to accompany
S. 699
TO AMEND THE ETHICS IN GOVERNMENT ACT OF 1978, TO EXTEND THE
AUTHORIZATION OF APPROPRIATIONS FOR THE OFFICE OF GOVERNMENT ETHICS FOR
7 YEARS, AND FOR OTHER PURPOSES
March 27 (legislative day, March 26), 1996.--Ordered to be printed
COMMITTEE ON GOVERNMENTAL AFFAIRS
TED STEVENS, Alaska, Chairman
JOHN GLENN, Ohio WILLIAM V. ROTH, Jr, Delaware
SAM NUNN, Georgia WILLIAM S. COHEN, Maine
CARL LEVIN, Michigan FRED THOMPSON, Tennessee
DAVID PRYOR, Arkansas THAD COCHRAN, Mississippi
JOSEPH I. LIEBERMAN, Connecticut JOHN McCAIN, Arizona
DANIEL K. AKAKA, Hawaii BOB SMITH, New Hampshire
BYRON L. DORGAN, North Dakota HANK BROWN, Colorado
Albert L. McDermott, Staff
Director
Leonard Weiss, Minority Staff
Director
Michal Sue Prosser, Chief Clerk
------
SUBCOMMITTEE ON OVERSIGHT OF GOVERNMENT MANAGEMENT AND THE DISTRICT OF
COLUMBIA
WILLIAM S. COHEN, Maine, Chairman
CARL LEVIN, Michigan FRED THOMPSON, Tennessee
DAVID PRYOR, Arkansas THAD COCHRAN, Mississippi
JOSEPH I. LIEBERMAN, Connecticut JOHN McCAIN, Arizona
DANIEL K. AKAKA, Hawaii HANK BROWN, Colorado
Kim Corthell, Staff Director
Paulina McCarter Collins,
Professional Staff Member
Linda J. Gustitus, Minority Staff
Director and Chief Counsel to the
Minority
Frankie de Vergie, Chief Clerk
C O N T E N T S
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Page
I. Summary and Purpose..............................................1
II. Background.......................................................1
III. Legislative History..............................................4
IV. Major Issues in S. 699...........................................5
V. Section-by-Section Analysis......................................6
VI. Estimated Cost of Legislation....................................7
VII. Evaluation of Regulatory Impact..................................8
VIII.Changes in Existing Law..........................................9
Calendar No. 349
104th Congress Report
SENATE
2d Session 104-244
_______________________________________________________________________
OFFICE OF GOVERNMENT ETHICS AUTHORIZATION ACT OF 1996
_______
March 27, (legislative day, March 26), 1996.--Ordered to be printed
_______________________________________________________________________
Mr. Stevens, from the Committee on Governmental Affairs, submitted the
following
R E P O R T
[To accompany S. 699]
The Committee on Governmental Affairs, to which was
referred the bill (S. 699) to extend the authorization for the
Office of Government Ethics (OGE) for seven years, and for
other purposes, having considered the same, reports favorably
on the bill and recommends that the bill do pass.
I. Summary and Purpose
The purpose of S. 699, is to ensure an effective system
throughout the Executive Branch by extending the Office of
Government Ethics authorization for seven years. The bill also
provides OGE with gift-acceptance authority and makes certain
technical changes to the ethics laws.
II. Background
A. Creation of the Office of Government Ethics
The Office of Government Ethics was created by Title IV of
the Ethics in Government Act of 1978 (Ethics Act). In response
to a 1976 General Accounting Office report to Congress
identifying a number of problems with the federal government's
ethics system, President Carter submitted draft legislation in
1977 proposing the creation of OGE. Later in 1977, the Senate
Committee on Governmental Affairs reported S. 555, the Public
Officials Integrity Act. The basic concepts of S. 555 were
incorporated into the Ethics Act, which was signed into law on
October 26, 1978, as Public Law 95-521.
The Ethics Act created OGE within the Office of Personnel
Management (OPM) to provide ``overall direction of executive
branch policies related to preventing conflicts of interest on
the part of officers and employees of any executive agency.''
OGE was originally authorized for five years, through September
30, 1983.
B. 1983 and 1988 reauthorizations
OGE was reauthorized for another five years in 1983 by
passage of S. 461, which was signed into law as Public law 98-
150. S. 461 was reported by the Senate Governmental Affairs
Committee, passed by the Senate, and amended by the House
Committee on the Judiciary and the House Committee on Post
Office and Civil Service. As finally passed, the law extended
OGE's authorization through September 30, 1988, and clarified
the agency's authority and independence. Specifically, the 1983
reauthorization:
Established a five-year term for the OGE Director;
Gave OGE greater independence from OPM, allowing OGE
to operate ``in consultation with'' rather than ``under
the general supervision of'' OPM;
Required a separate budget line for OGE;
Permitted the OGE Director to request assistance from
the Inspector General of an agency in conducting
investigations involving financial disclosures; and
Required OGE to review the financial disclosure
reports of high-level White House aides.
OGE was again reauthorized in 1988, this time for six
years, through September 30, 1994. S. 2344, as reported by the
Senate Committee on Governmental Affairs, made a number of
important changes in OGE's structure, including establishing
OGE as a free-standing agency independent of OPM (effective
October 1, 1989). In addition, the 1988 reauthorization, signed
into law as Public Law 100-598:
Upgraded the Director's position to Level III from
Level V of the Executive Schedule;
Clarified the Director's power to recommend and order
``corrective action'' on the part of other agencies;
Expanded the Director's authority to request
Inspector General assistance to include any
investigation pursuant to the agency's statutory
responsibilities; and
Increased OGE's authorized appropriations to $2.5
million for fiscal year 1989 and to $3 million for each
of the five years thereafter.
C. Developments since OGE's last reauthorization
Since OGE was last reauthorized in 1988, the ethics laws
have undergone a dramatic restructuring by virtue of the Ethics
Reform Act of 1989 (Reform Act), Public Law 101-194. The Reform
Act consolidated the ethics laws applicable to all three
branches of government; expanded the post-employment
restrictions for employees of the Executive Branch and extended
such restrictions to the legislative branch; revamped the
financial disclosure rules for senior government officials;
changed certain aspects of the laws pertaining to the
acceptance of gifts, outside earned income, and outside
employment; authorized ``certificates of divestiture'' for
incoming political appointees who sell assets in order to avoid
conflicts of interest; banned the receipt of Honoraria by
Federal employees; \1\ and added civil penalties to the range
of potential sanctions for violations of the criminal ethics
laws, among other changes. As the agency responsible for
coordinating the Executive Branch's ethics program, these
changes added substantially to OGE's workload, calling for
increased employee education and counseling, the issuance of
regulations, the development of new forms, and other related
tasks.
\1\ The U.S. Supreme Court on February 22, 1995, held that the
total Honoraria ban violates the First Amendment rights of the persons
on whose behalf the case was brought in U.S. v. National Treasury
Employees Union (federal employees below grade GS-16). However, the
decision leaves some question as to how the description of employees
below GS-16 should be applied to employees who are not in GS-15
positions or below or who were not among the respondents in the case.
At the time this report was filed, no final injunction had been issued
by the District Court on this matter.
---------------------------------------------------------------------------
Also since OGE was last reauthorized, two presidential
Executive Orders have added to OGE's responsibilities.
President Bush issued Executive Order 12674 on April 12, 1989,
requiring OGE to issue new regulations, including comprehensive
Standards of Conduct for the Executive Branch, and to review
agency requests for supplemental regulations. President Clinton
issued Executive Order 12834 on January 20, 1993, creating new
post-employment rules for top political appointees and
requiring OGE to assist in its implementation.
In June 1990, the Subcommittee on Oversight of Government
Management (OGM) held a hearing on OGE's agency review program
and found significant problems. The OGM Subcommittee found that
OGE never audited certain agencies; the intervals between
audits at other agencies were too long; and while OGE did a
good job of identifying weaknesses and making recommendations
when it conducted audits, it did not follow up effectively to
make sure that its recommendations were implemented by
agencies. Both OGE and the General Accounting Office (GAO)
testified that the main reason for these deficiencies was that
OGE lacked sufficient staff to do a better job.
D. OGE's budget and staffing
In light of OGE's expanded duties under law and Executive
Order and the findings of the OGM Subcommittee hearing, it
became apparent that OGE's resources were not sufficient to
accomplish its mission. Accordingly, the Congress acted twice
to ensure that OGE had the tools it needed, enacting Public Law
101-334, to increase OGE's appropriations cap to $5 million,
and Public Law 102-506, to remove OGE's appropriations cap.
OGE's budget and staff levels since its last reauthorization
are as follows:
------------------------------------------------------------------------
Authorized
Funding staff
levels\1\
------------------------------------------------------------------------
Fiscal year:
1989.................................... $1,822,000 35
1990.................................... 3,414,000 53
1991.................................... 3,500,000 53
1992.................................... 6,303,000 70
1993.................................... 8,265,000 101
1994.................................... 8,313,000 93
1995.................................... 8,154,000 93
1996.................................... 7,776,000 91
------------------------------------------------------------------------
\1\ The actual number of staff years used each year has been less than
the authorized level.
The Committee believes that the significant increase in
OGE's funding and staffing since it was last reauthorized is
justified because of its status as a free-standing agency with
responsibility for many administrative matters formerly handled
by OPM and its increased workload under statute and Executive
Order. Significantly, the growth in OGE's budget leveled off in
FY93-FY96, once it had the opportunity to respond to its
changed environment.
e. presidential transition
OGE has a variety of responsibilities in connection with
presidential transitions. The 1992 transition, which involved a
change of political parties, not just a new President, drew
heavily on OGE's resources.
Before the election, OGE briefed the candidates' staffs on
the ethics laws applicable to high-level appointees and OGE's
role in the appointments process. This information assisted an
incoming administration in making its initial personnel
decisions. Immediately after the election, OGE advised
transition team staff and agency personnel with respect to
permissible activities during the transition period.
The high level of turnover among top-level Executive Branch
employees placed significant demands on OGE's resources. In
addition to providing ethics to individuals who entered or
considered entering government service as a result of the
transition, OGE provided advice to outgoing government
employees about negotiating for new jobs and post-employment
restrictions. One indication of OGE's increased workload is the
number of financial disclosure statements reviewed by the
agency for individuals nominated by the President for positions
requiring Senate confirmation. In 1992 OGE reviewed, certified,
and forwarded to the Senate 256 public financial disclosure
statements for such presidential nominees. In 1993, that number
grew to 547, with on average over 100 draft reports pending at
OGE at any given time. In 1994, OGE handled 415 financial
disclosure reports.
OGE is also responsible for issuing certificates of
divestiture, which allow nominees who meet statutory criteria
to defer taxes on capital gains if they dispose of assets in
order to avoid conflicts of interest; assisting in the
establishment of qualifying blind trusts; and monitoring
compliance with any ethics agreements made by appointees during
the confirmation process. Presidential transitions increase the
level of activity in all of these areas.
OGE informed the OGM Subcommittee that, from its program
perspective, it had no recommendations for administrative or
legislative changes with respect to future presidential
transitions.
III. Legislative History
S. 699 was introduced by Senators Cohen and Levin on April
6, 1995, and referred to the Subcommittee on Oversight of
Government Management and the District of Columbia of the
Committee on Governmental Affairs. S. 699 is nearly identical
to legislation (S. 1413) introduced by Senators Levin and Cohen
and passed by the Senate in the 103d Congress. On April 20,
1994, the OGM Subcommittee held a hearing on S. 1413. Stephen
D. Potts, the Director of OGE, was the only witness. Mr. Potts
testified in favor of reauthorizing OGE and granting the agency
gift acceptance authority. He also described OGE's agency
review program, the presidential transition process, and OGE's
budget and personnel resources. Since the Subcommittee held a
hearing so recently on the issues surrounding the OGE
reauthorization bill, the Subcommittee did not hold a hearing
on S. 699. The Subcommittee polled out S. 699 with no
amendments and reported it to the full Committee for
consideration on August 1, 1995. The Committee met on August 10
and approved S. 699 by voice vote.
President Clinton nominated Mr. Potts on July 12, 1995 to
serve a second five year term as Director of OGE. The
Governmental Affairs Committee approved his nomination on
August 10, 1995 by voice vote and the full Senate confirmed his
nominated on August 11.
IV. Major Issues in S. 699
a. length of reauthorization
S. 699 reauthorizes OGE for seven years, which is one year
longer than its last reauthorization. The Committee agreed with
OGE's request that the period be extended to seven years in
order to avoid having reauthorization occur during a
presidential election year or the year immediately thereafter,
when the large turnover in high-level executive branch
employees places great demands on OGE's resources.
b. gift acceptance authority
Federal agencies are not permitted to accept gifts unless
they have specific statutory authority to do so. While OGE has
not had this authority in the past, twenty-three agencies and
departments do have some type of gift acceptance authority.
Based on OGE's testimony, the Committee determined that gift
acceptance authority would assist OGE in performing its duties.
OGE intends to use its gift acceptance authority primarily
in connection with its training and education function. OGE
regularly conducts multi-agency training sessions for federal
employees around the country, and sometimes there is no federal
facility available that can provide adequate space and
services. The gift acceptance authority in S. 699 will allow
OGE to accept donated non-federal facilities, for example, an
auditorium and related services such as projectionists and
custodians, which might be offered free-of-charge by a state or
local government or a university.
OGE has asked for broad authority, as other agencies have,
but coupled its request with a requirement that the agency
establish written rules governing the acceptance of gifts to
ensure that the authority is used as intended and guard against
abuse. S. 699 requires the Director of OGE to establish written
rules to govern the exercise of this authority to safeguard
against conflicts of interest or the appearance of conflicts in
the acceptance of gifts.
Currently, other agencies that have gift acceptance
authority do not have to prescribe regulations governing its
use. While other agencies would not be required to follow the
example of OGE's regulations in making their own determinations
about their gift acceptance authority, OGE believes that its
regulations would provide useful guidance to agencies. OGE also
believes it would place the agency in a better position to
recommend more strongly to agencies that they too consider such
limiting regulations so as not to bring their programs and
employees' conduct into question.
C. repeal and conforming amendments
S. 699 also repeals, corrects, and modifies various
provisions of current law. Two of the changes amend the Ethics
in Government Act: (i) correcting the heading of Section 401 to
reflect the fact that OGE was made independent of OPM in 1988,
and (ii) moving the date of OGE's biennial report to Congress
back by one month, from March 31 to April 30, in order to give
OGE more time to collect and analyze calendar year-end-data. S.
699 also repeals a requirement dating from 1980 that requires a
poster entitled ``Code of Ethics for Government Service'' to be
displayed in all federal facilities employing 20 or more
people. Display of the poster is no longer appropriate since it
does not incorporate the current Standards of Conduct
applicable to Executive Branch employees, and OGE has developed
new educational materials for employees. Finally, S. 699 amends
the Federal Deposit Insurance Act to delete a requirement that
was added in 1993 (Public Law 103-204) that requires OGE to
consult with the Board of Directors of the Federal Deposit
Insurance Corporation with respect to ethics regulations
applicable to independent contractors working for the FDIC.
Because OGE's responsibilities and expertise pertain to the
conduct of Executive Branch employees, and because these FDIC
contractors are not government employees, the consultative role
imposed by the Act is not consistent with OGE's mission.
V. Section-by-Section Analysis
Section 1 states the short title of the Act.
Section 2 authorizes the Director of OGE to accept and
utilize, on behalf of the United States, any gifts or donations
for the purpose of aiding or facilitating the work of OGE. The
section also places certain limits on the use of this authority
and requires the Director to establish written rules governing
its use to avoid conflicts of interest or the appearance of
conflicts.
Section 3 extends OGE's authorization for seven years,
authorizing the appropriation of such sums as may be necessary
to carry out OGE's duties for fiscal years 1996 through 2002.
Section 4 contains repealing and conforming amendments:
It repeals a requirement that a specific ethics
poster be displayed in all federal facilities with 20
or more employees;
It deletes a requirement in the Federal Deposit
Insurance Act that requires OGE to consult with the
Board of Directors of the Federal Deposit Insurance
Corporation with respect to ethics regulations
applicable to independent contractors working for the
FDIC;
It corrects a heading in the Ethics in Government Act
to reflect the fact that OGE was made independent of
OPM in 1988; and
It extends by one month, from March 31 to April 30,
the date on which OGE is required to file its biennial
reports to Congress.
VI. Estimated Cost of Legislation
U.S. Congress,
Congressional Budget Office,
Washington, DC, October 30, 1995.
Hon. Ted Stevens,
Chairman, Committee on Governmental Affairs, U.S. Senate, Washington,
DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 699, the Office of
Government Ethics Authorization Act of 1995.
Because enactment of this legislation could affect direct
spending, pay-as-you-go procedures would apply to the bill.
If you wish further details on this estimate, we will be
pleased to provide them.
Sincerely,
June E. O'Neill, Director.
Enclosure.
congressional budget office cost estimate
1. Bill number: S. 699.
2. Bill title: Office of Government Ethics Authorization
Act of 1995.
3. Bill status: As ordered reported by the Senate Committee
on Governmental Affairs on August 10, 1995.
4. Bill purpose: S. 699 would authorize the appropriation
of such sums as may be necessary to fund the Office of
Government Ethics from fiscal year 1996 through fiscal year
2002. The office's authorization expired at the end of fiscal
year 1994. The 1995 appropriation for the Office of Government
Ethics was $8.1 million.
The bill also would allow the director of the Office of
Government Ethics to accept and use certain types of gifts to
further the work of the office.
5. Estimated cost to the Federal Government: Enacting S.
699 would affect discretionary spending, subject to
appropriations of the necessary funds, as shown in the
following table. The table provides two alternative spending
paths: one assuming no annual adjustment for inflation, and one
including such an adjustment.
----------------------------------------------------------------------------------------------------------------
1995 1996 1997 1998 1999 2000
----------------------------------------------------------------------------------------------------------------
Spending under current law:
Budget authority \1\.................................. 8.1 ....... ....... ....... ....... .......
Estimated outlays..................................... 8.1 0.4 ....... ....... ....... .......
WITHOUT ADJUSTMENT FOR INFLATION
Proposed changes:
Estimated authorization............................... ....... 8.1 8.1 8.1 8.1 8.1
Estimated outlays..................................... ....... 7.7 8.1 8.1 8.1 8.1
Projected spending under S. 699:
Estimated authorization \1\........................... 8.1 8.1 8.1 8.1 8.1 8.1
Estimated outlays..................................... 8.1 8.1 8.1 8.1 8.1 8.1
WITH ADJUSTMENT FOR INFLATION
Proposed changes:
Estimated authorization............................... ....... 8.5 8.8 9.2 9.5 9.9
Estimated outlays..................................... ....... 8.1 8.8 9.2 9.5 9.9
Projected spending under S. 699:
Estimated authorization \1\........................... 8.1 8.5 8.8 9.2 9.5 9.9
Estimated outlays..................................... 8.1 8.1 8.5 9.2 9.5 9.9
----------------------------------------------------------------------------------------------------------------
\1\ The 1995 level is the amount appropriated for that year.
The costs of this bill fall within budget function 800.
6. Basis of estimate: This estimate assumes that all funds
authorized will be appropriated and that spending will occur at
historical rates. The estimated authorization amounts in the
above table are alternative projections for this program: the
1995 appropriation without any adjustment for inflation, and
the 1995 level plus annual adjustments for inflation. The 1996
appropriation, however, is likely to be lower than both of the
alternative authorization estimates ($8.1 million and $8.5
million). The House-Senate conference version of the Treasury,
Postal Service, and General Government Appropriation Bill for
1996 includes $7.8 million for the Office of Government Ethics.
7. Pay-as-you-go considerations: The Balanced Budget and
Emergency Deficit Control Act of 1985 sets up pay-as-you-go
procedures for legislation affecting direct spending or
receipts through 1998. CBO estimates that enacting S. 699 could
affect direct spending. Thus, pay-as-you-go procedures would
apply to the bill.
Direct spending could result from the provision that would
allow the director to accept donations to further the work of
the office. CBO expects that any contributions would be used in
the same year. Therefore, we estimate that the net change in
direct spending would be negligible in all years. The following
table summarizes CBO's estimate of the pay-as-you-go impact of
S. 699.
------------------------------------------------------------------------
1996 1997 1998
------------------------------------------------------------------------
Change in outlays......................... 0 0 0
Change in receipts........................ (\1\) (\1\) (\1\)
------------------------------------------------------------------------
\1\ Not applicable.
8. Estimated cost to State and local governments: None.
9. Estimate comparison: None.
10. Previous CBO estimate: None.
11. Estimate prepared by: Mark Grabowicz.
12. Estimate approved by: Robert A. Sunshine, for Paul N.
Van de Water, Assistant Director for Budget Analysis.
VII. Evaluation of Regulatory Impact
Pursuant to the requirements of paragraph 11(b) of rule
XXVI of the Standing Rules of the Senate, the Committee has
considered the regulatory and paperwork impact of S. 699, as
well as the impact of the bill on personal privacy. The bill
creates a limited regulator responsibility on the part of the
Director to establish rules governing internal government
operations, but imposes no additional regulatory burden on
private sector individuals or businesses. The bill will have no
significant impact on paperwork and no impact on personal
privacy beyond those imposed by existing law.
VIII. Changes in Existing Law
In compliance with paragraph 12 of rule XXVI of the
Standing rules of the Senate, changes in existing law made by
S. 699 are shown as follows (existing law proposed to be
omitted is enclosed in black brackets, new matter is printed in
italic, and existing law in which no changes are proposed is
shown in roman):
OFFICE OF GOVERNMENT ETHICS
* * * * * * *
Sec.
401. Office of Government Ethics.
402. Authority and functions.
403. Administrative provisions.
404. Rules and regulations.
405. Authorization of appropriations.
406. Annual pay.
407. Annual pay of Director.
408. Reports to Congress.
401. [Office of Government Ethics] Establishment;
Appointment of Director
(a) There is established an executive agency to be known as
the Office of Government Ethics.
(b) There shall be at the head of the Office of Government
Ethics a Director (hereinafter referred to as the
``Director''), who shall be appointed by the President, by and
with the advice and consent of the Senate. Effective with
respect to any individual appointed or reappointed by the
President as Director on or after October 1, 1983, the term of
service of the Director shall be five years.
(c) The Director may--
(1) appoint officers and employees, including
attorneys, in accordance with chapter 51 and subchapter
III of chapter 53 of title 5, United States Code; and
(2) contract for financial and administrative
services (including those related to budget and
accounting, financial reporting, personnel, and
procurement) with the General Services Administration,
or such other Federal agency as the Director determines
appropriate, for which payment shall be made in
advance, or by reimbursement, from funds of the Office
of Government Ethics in such amounts as may be agreed
upon by the Director and the head of the agency
providing such services.
Contract authority under paragraph (2) shall be effective
for any fiscal year only to the extent that appropriations are
available for that purpose.
402. Authority and Functions
(a) The Director shall provide, in consultation with the
Office of Personnel Management, overall direction of executive
branch policies related to preventing conflicts of interest on
the part of officers and employees of any executive agency, as
defined in section 105 of Title 5.
(b) The responsibilities of the Director shall include--
(1) developing, in consultation with the Attorney
General and the Office of Personnel Management, rules
and regulations to be promulgated by the President or
the Director pertaining to conflicts of interest and
ethics in the executive branch, including rules and
regulations establishing procedures for the filing,
review, and public availability of financial statements
filed by officers and employees in the executive branch
as required by title II of this Act;
(2) developing, in consultation with the Attorney
General and the Office of Personnel Management, rules
and regulations to be promulgated by the President or
the Director pertaining to the identification and
resolution of conflicts of interest;
(3) monitoring and investigating compliance with the
public financial disclosure requirements of title II of
this Act by officers and employees of the executive
branch and executive agency officials responsible for
receiving, reviewing, and making available financial
statements filed pursuant to such title;
(4) conducting a review of financial statements to
determine whether such statements reveal possible
violations of applicable conflict of interest laws or
regulations and recommending appropriate action to
correct any conflict of interest or ethical problems
revealed by such review;
(5) monitoring and investigating individual and
agency compliance with any additional financial
reporting and internal review requirements established
by law for the executive branch.
(6) interpreting rules and regulations issued by the
President or the Director governing conflict of
interest and ethical problems and the filing of
financial statements;
(7) consulting, when requested, with agency ethics
counselors and other responsible officials regarding
the resolution of conflict of interest problems in
individual cases;
(8) establishing a formal advisory opinion service
whereby advisory opinions are rendered on matters of
general applicability or on important matters of first
impression after, to the extent practicable, providing
interested parties with an opportunity to transmit
written comments with respect to the request for such
advisory opinion, and whereby such advisory opinions
are compiled, published, and made available to agency
ethics counselors and the public;
(9) ordering corrective action on the part of
agencies and employees which the Director deems
necessary;
(10) requiring such reports from executive agencies
as the Director deems necessary;
(11) assisting the Attorney General in evaluating the
effectiveness of the conflict of interest laws and in
recommending appropriate amendments;
(12) evaluating, with the assistance of the Attorney
General and the Office of Personnel Management, the
need for changes in rules and regulations issued by the
Director and the agencies regarding conflict of
interest and ethical problems, with a view toward
making such rules and regulations consistent with and
an effective supplement to the conflict of interest
laws;
(13) cooperating with the Attorney General in
developing an effective system for reporting
allegations of violations of the conflict of interest
laws to the Attorney General, as required by section
535 of title 28, United States Code;
(14) providing information on and promoting
understanding of ethical standards in executive
agencies; and
(15) developing, in consultation with the Office of
Personnel Management, and promulgating such rules and
regulations as the Director determines necessary or
desirable with respect to the evaluation of any item
required to be reported by title II of this Act.
(c) In the development of policies, rules, regulations,
procedures, and forms to be recommended, authorized, or
prescribed by him, the Director shall consult when appropriate
with the executive agencies affected and with the Attorney
General.
(d)(1) The Director shall, by the exercise of any authority
otherwise available to the Director under this title, ensure
that each executive agency has established written procedures
relating to how the agency is to collect, review, evaluate, and
if applicable, make publicly available, financial disclosure
statements filed by any of its officers or employees.
(2) In carrying out paragraph (1), the Director shall
ensure that each agency's procedures are in conformance with
all applicable requirements, whether established by law, rule,
regulation, or Executive order.
(e) In carrying out subsection (b)(10), the Director shall
prescribe regulations under which--
(1) each executive agency shall be required to submit
to the Office an annual report containing--
(A) a description and evaluation of the
agency's ethics program, including any
educational, counseling, or other services
provided to officers and employees, in effect
during the period covered by the report; and
(B) the position title and duties of--
(i) each official who was designated
by the agency head to have primary
responsibility for the administration,
coordination, and management of the
agency's ethics program during any
portion of the period covered by the
report; and
(ii) each officer or employee who was
designated to serve as an alternate to
the official having primary
responsibility during any portion of
such period; and
(C) any other information that the Director
may require in order to carry out the
responsibilities of the Director under this
title; and
(2) each executive agency shall be required to inform
the Director upon referral of any alleged violation of
Federal conflict of interest law to the Attorney
General pursuant to section 535 of title 28, United
States Code, except that nothing under this paragraph
shall require any notification or disclosure which
would otherwise be prohibited by law.
(f)(1) In carrying out subsection (b)(9) with respect to
executive agencies, the Director--
(A) may--
(i) order specific corrective action on the
part of an agency based on the failure of such
agency to establish a system for the
collection, filing, review, and, when
applicable, public inspection of financial
disclosure statements, in accordance with
applicable requirements, or to modify an
existing system in order to meet applicable
requirements; or
(ii) order specific corrective action
involving the establishment or modification of
an agency ethics program (other than with
respect to any matter under clause (i)) in
accordance with applicable requirements; and
(B) shall, if an agency has not complied with an
order under subparagraph (A) within a reasonable period
of time, notify the President and the Congress of the
agency's noncompliance in writing (including, with the
notification, any written comments which the agency may
provide).
(2)(A) In carrying out subsection (b)(9) with respect to
individual officers and employees--
(i) the Director may make such recommendations and
provide such advice to such officers and employees as
the Director considers necessary to ensure compliance
with rules, regulations, and Executive orders relating
to conflicts of interest or standards of conduct;
(ii) if the Director has reason to believe that an
officer or employee is violating, or has violated, any
rule, regulation, or Executive order relating to
conflicts of interest or standards of conduct, the
Director--
(I) may recommend to the head of the
officer's or employee's agency that such agency
head investigate the possible violation and, if
the agency head finds such a violation, that
such agency head take any appropriate
disciplinary action (such as reprimand,
suspension, demotion, or dismissal) against the
officer or employee, except that, if the
officer or employee involved is the agency
head, any such recommendation shall instead be
submitted to the President; and
(II) shall notify the President in writing if
the Director determines that the head of an
agency has not conducted an investigation
pursuant to subclause (I) within a reasonable
time after the Director recommends such action;
(iii) if the Director finds that an officer or
employee is violating any rule, regulation, or
Executive order relating to conflicts of interest or
standards of conduct, the Director--
(I) may order the officer or employee to take
specific action (such as divestiture, recusal,
or the establishment of a blind trust) to end
such violation; and
(II) shall, if the officer or employee has
not complied with the order under subclause (I)
within a reasonable period of time, notify, in
writing, the head of the officer's or
employee's agency of the officer's or
employee's noncompliance, except that, if the
officer or employee involved is the agency
head, the notification shall instead be
submitted to the President; and
(iv) if the Director finds that an officer or
employee is violating, or has violated, any rule,
regulation, or Executive order relating to conflicts of
interest or standards of conduct, the Director--
(I) may recommend to the head of the
officer's or employee's agency that appropriate
disciplinary action (such as reprimand,
suspension, demotion, or dismissal) be brought
against the officer or employee, except that if
the officer or employee involved is the agency
head, any such recommendations shall instead be
submitted to the President; and
(II) may notify the President in writing if
the Director determines that the head of an
agency has not taken appropriate disciplinary
action within a reasonable period of time after
the Director recommends such action.
(B)(i) In order to carry out the Director's duties and
responsibilities under subparagraph (A) (iii) or (iv) with
respect to individual officers and employees, the Director may
conduct investigations and make findings concerning possible
violations of any rule, regulation, or Executive order relating
to conflicts of interest or standards of conduct applicable to
officers and employees of the executive branch.
(ii)(I) Subject to clause (iv) of this subparagraph, before
any finding is made under subparagraphs (A) (iii) or (iv), the
officer or employee involved shall be afforded notification of
the alleged violation, and an opportunity to comment, either
orally or in writing, on the alleged violation.
(II) The Director shall, in accordance with section 553 of
title 5, United States Code, establish procedures for such
notification and comment.
(iii) Subject to clause (iv) of this subparagraph, before
any action is ordered under subparagraph (A)(iii), the officer
or employee involved shall be afforded an opportunity for a
hearing, if requested by such officer or employee, except that
any such hearing shall be conducted on the record.
(iv) The procedures described in clauses (ii) and (iii) of
this subparagraph do not apply to findings or orders for action
made to obtain compliance with the financial disclosure
requirements in title 2 of this Act. For those findings and
orders, the procedures in section 206 of this Act shall apply.
(3) The Director shall send a copy of any order under
paragraph (2)(A)(iii) to--
(A) the officer or employee who is the subject of
such order; and
(B) the head of officer's or employee's agency or, if
such officer or employee is the agency head, to the
President.
(4) For purposes of paragraphs (2)(A) (ii), (iii), (iv),
and (3)(B), in the case of an officer or employee within an
agency which is headed by a board, committee, or other group of
individuals (rather than by a single individual), any
notification, recommendation, or other matter which would
otherwise be sent to an agency head shall instead be sent to
the officers or employees appointing authority.
(5) Nothing in this title shall be considered to allow the
Director (or any designee) to make any finding that a provision
of title 18, United States Code, or any criminal law of the
United States outside of such title, has been or is being
violated.
(6) Notwithstanding any other provision of law, no record
developed pursuant to the authority of this section concerning
an investigation of an individual for a violation of any rule,
regulation, or Executive order relating to a conflict of
interest shall be made available pursuant to section 552(a)(3)
of title 5, United States Code, unless the request for such
information identifies the individual to whom such records
relate and the subject matter of any alleged violation to which
such records relate, except that nothing in this subsection
shall affect the application of the provisions of section
552(b) of title 5, United States Code, to any record so
identified.
403. Administrative Provisions
(a) Upon the request of the Director, each executive agency
is directed to
(1) make its services, personnel, and facilities
available to the Director to the greatest practicable
extent for the performance of functions under this Act;
and
(2) except when prohibited by law, furnish to the
Director all information and records in its possession
which the Director may determine to be necessary for
the performance of his duties.
The authority of the Director under this section includes
the authority to request assistance from the inspector general
of an agency in conducting investigations pursuant to the
Office of Government Ethnics responsibilities under this Act.
The head of any agency may detail such personnel and furnish
such services, with or without reimbursement, as the Director
may request to carry out the provisions of this Act.
(b)(1) The Director is authorized to accept and utilize on
behalf of the United States, any gift, donation, bequest, or
devise of money, use of facilities, personal property, or
services for the purpose of aiding or facilitating the work of
the Office of Government Ethics.
(2) No gift may be accepted--
(A) that attaches conditions inconsistent with
applicable laws or regulations; or
(B) that is conditioned upon or will require the
expenditure of appropriated funds that are not
available to the Office of Government Ethics.
(3) The Director shall establish written rules setting
forth the criteria to be used in determining whether the
acceptance of contributions of money, services, use of
facilities, or personal property under this subsection would
reflect unfavorably upon the ability of the Office of
Government Ethics, or any employee of such Office, to carry out
its responsibilities or official duties in a fair and objective
manner, or would compromise the integrity or the appearance of
the integrity of its programs or any official involved in those
programs.
404. Rules and Regulations
In promulgating rules and regulations pertaining to
financial disclosure, conflict of interest, and ethics in the
executive branch, the Director shall issue rules and
regulations in accordance with chapter 5 of title 5, United
States Code. Any person may seek judicial review of any such
rule or regulation.
405. Authorization of Appropriations
There are authorized to be appropriated to carry out [the
provisions of] this title [and for no other purpose--
[(1) not to exceed $2.5 million for the fiscal year
ending September 30, 1989;
[(2) not to exceed $5 million for the fiscal year
ending September 30, 1990; and
[(3)] such sums as may be necessary for [each of the
4 fiscal years thereafter.] the fiscal years beginning
with fiscal year 1996 and ending with fiscal year 2002.
406. Annual Pay
[Section amended section 5316 of Title 5, Government
Organization and Employees, by adding ``Director of the Office
of Government Ethics'' to the list of positions at Level V of
the Executive Schedule.]
407. Annual Pay of Director
[Section amended section 5316 of Title 5, Government
Organization and Employees, by striking out ``Director of the
Office of Government Ethics'' from the list of positions at
Level V of the Executive Schedule, and amended section 5314 of
Title 5, Government Organization and Employees, by adding
``Director of the Office of Government Ethics'' to the list of
positions at Level III of the Executive Schedule.]
408. Reports to Congress
The Director shall, no later than [March 31] April 30 of
each year in which the second session of a Congress begins,
submit to the Congress a report containing
(1) a summary of the actions taken by the Director
during a 2-year period ending on December 31 of the
preceding year in order to carry out the Directors
functions and responsibilities under this title; and
(2) such other information as the Director may
consider appropriate.
* * * * * * *
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12 U.S.C. 1822
(f) Conflict of Interest.--(1) Applicability of other
provisions.--(A) Clarification of status of corporation.--The
Corporation is, and has been since its creation, an agency for
purposes of title 18.
(B) Treatment of contractors.--Any individual who, pursuant
to a contract or any other arrangement, performs functions or
activities of the Corporation under the direct supervision of
an officer or employee of the Corporation, shall be deemed to
be an employee of the Corporation for purposes of title 18, and
this chapter. Any individual who, pursuant to a contract or any
other agreement, acts for or on behalf of the Corporation, and
who is not otherwise treated as an officer or employee of the
United States for purposes of title 18, shall be deemed to be a
public official for purposes of section 201 of title 18.
(2) Regulations concerning employee conduct.--The officers
and employees of the Corporation and those individuals under
contract to the Corporation who are deemed, under paragraph
(1)(B), to be employees of the Corporation for purposes of
title 18 shall be subject to the ethics and conflict of
interest rules and regulations issued by the Office of
Government Ethics, including those concerning employee conduct,
financial disclosure, and post-employment activities. The Board
of Directors may prescribe regulations that supplement such
rules and regulations only with the concurrence of that Office.
(3) Regulations concerning independent contractors.--The
Board of Directors[, with the concurrence of the Office of
Government Ethics,] shall prescribe regulations applicable to
those independent contractors who are not deemed, under
paragraph (1)(B), to be employees of the Corporation for
purposes of title 18 governing conflicts of interest, ethical
responsibilities, and the use of confidential information
consistent with the goals and purposes of titles 18 and 41. Any
such regulations shall be in addition to, and not in lieu of,
any other statute or regulation which may apply to the conduct
of such independent contractors.
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CODE OF ETHICS FOR GOVERNMENT SERVICE--DISPLAY
Public Law 96-303, [H.R. 5997]; July 3, 1980
* * * * * * *
[An Act to provide for the display of the Code of Ethics
for Government Service.
[Be it enacted by the Senate and House of Representatives
of the United States of America in Congress assembled, That,
under such regulations as the Administrator shall prescribe,
each agency shall display in appropriate areas of Federal
buildings copies of the Code of Ethics for Government Service.
[Sec. 2. (a) The Administrator shall provide for the
publication of copies of such Code of Ethics and for their
distribution to agencies for use under the first section of
this Act.
[(b) The Administrator may accept on behalf of the United
States any unconditional gift made for purposes of this Act.
[Sec. 3. For purposes of this Act--
[(1) the term ``agency'' means an Executive agency
(as defined by section 105 of title 5, United States
Code), the United States Postal Service, and the Postal
Rate Commission;
[(2) the term ``Administrator'' means the
Administrator of the General Services Administration;
[(3) the Code of Ethics for Government Service shall
read as follows--
[Code of Ethics for Government Service
[Any person in Government service should:
[I. Put loyalty to the highest moral
principles and to country above loyalty to
persons, party, or Government department.
[II. Uphold the Constitution, laws, and
regulations of the United States and of all
governments therein and never be a party to
their evasion.
[III. Give a full day's labor for a full
day's pay; giving earnest effort and best
thought to the performance of duties.
[IV. Seek to find and employ more efficient
and economical ways of getting tasks
accomplished.
[V. Never discriminate unfairly by the
dispensing of special favors or privileges to
anyone, whether for remuneration or not; and
never accept, for himself or herself or for
family members, favors or benefits under
circumstances which might be construed by
reasonable persons as influencing the
performance of governmental duties.
[VI. Make no private promises of any kind
binding upon the duties of office since a
Government employee has no private word which
can be binding on public duty.
[VII. Engage in no business with the
Government, either directly or indirectly,
which is inconsistent with the conscientious
performance of government duties.
[VIII. Never use any information gained
confidentially in the performance of
governmental duties as means of making private
profit.
[IX. Expose corruption wherever discovered.
[X. Uphold these principles, ever conscious
that public office is a public trust.
[Your agency ethics official and the Office of
Government Ethics are available to answer questions on
conflicts of interest; and
[(4) the term ``Federal building'' means any building
in which at least 20 individuals are regularly employed
by an agency as civilian employees.
[Sec. 4. The provisions of this Act shall take effect
October 1, 1980. There shall be no costs imposed on the Federal
Government for the printing, framing or other preparation of
the Code of Ethics for Government Service under this Act.]