[Senate Report 107-111]
[From the U.S. Government Publishing Office]
Calendar No. 263
107th Congress Report
SENATE
1st Session 107-111
_______________________________________________________________________
MAKING PERMANENT THE AUTHORITY TO REDACT FINANCIAL DISCLOSURE
STATEMENTS OF JUDICIAL EMPLOYEES AND JUDICIAL OFFICERS
__________
R E P O R T
of the
COMMITTEE ON GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
to accompany
H.R. 2336
TO MAKE PERMANENT THE AUTHORITY TO REDACT FINANCIAL DISCLOSURE
STATEMENTS OF JUDICIAL EMPLOYEES AND JUDICIAL OFFICERS
December 7, 2001.--Ordered to be printed
__________
U.S. GOVERNMENT PRINTING OFFICE
99-010 WASHINGTON : 2001
COMMITTEE ON GOVERNMENTAL AFFAIRS
JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan FRED THOMPSON, Tennessee
DANIEL K. AKAKA, Hawaii TED STEVENS, Alaska
RICHARD J. DURBIN, Illinois SUSAN M. COLLINS, Maine
ROBERT G. TORRICELLI, New Jersey GEORGE V. VOINOVICH, Ohio
MAX CLELAND, Georgia PETE V. DOMENICI, New Mexico
THOMAS R. CARPER, Delaware THAD COCHRAN, Mississippi
JEAN CARNAHAN, Missouri ROBERT F. BENNETT, Utah
MARK DAYTON, Minnesota JIM BUNNING, Kentucky
Joyce A. Rechtschaffen, Staff Director and Counsel
Lawrence B. Novey, Counsel
Hannah S. Sistare, Minority Staff Director and Counsel
Fred Ansell, Chief Counsel
Darla D. Cassell, Chief Clerk
C O N T E N T S
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Page
I. Purpose and Summary...............................................1
II. Background and Need for Legislation...............................2
III.Legislative History...............................................6
IV. Regulatory Impact Statement.......................................6
V. Congressional Budget Office Cost Estimate.........................7
VI. Changes to Existing Law...........................................7
Calendar No. 263
107th Congress Report
SENATE
1st Session 107-111
======================================================================
MAKING PERMANENT THE AUTHORITY TO REDACT FINANCIAL DISCLOSURE
STATEMENTS OF JUDICIAL EMPLOYEES AND JUDICIAL OFFICERS
_______
December 7, 2001.--Ordered to be printed
_______
Mr. Lieberman, from the Committee on Governmental Affairs, submitted
the following
R E P O R T
[To accompany H.R. 2336]
The Committee on Governmental Affairs, to which was
referred the bill (H.R. 2336) to make permanent the authority
to redact financial disclosure statements of judicial employees
and judicial officers, having considered the same, reports
favorably thereon and recommends that the bill do pass.
When ordering the bill reported, the Committee agreed that
Members would further evaluate the bill prior to Senate
consideration. That further evaluation has occurred, and, based
thereon, an amendment to the bill will be offered, and a
recommendation will be made that the Senate adopt the amendment
and pass the bill as so amended. The purpose of the amendment
will be to extend the redaction authority for 4 years instead
of making it permanent.
I. Purpose and Summary
H.R. 2336 would make permanent the authority to redact
financial disclosure statements filed by judges and other
officers and employees of the federal judiciary when the
Judicial Conference, in consultation with the United States
Marshals Service, finds that revealing the information could
endanger the filer. The bill would accomplish this by repealing
section 105(b)(3)(E) of the Ethics in Government Act of 1978 (5
U.S.C. app.), which now provides that the authority to redact
shall expire on December 31, 2001.
When ordering the bill reported, the Committee agreed that
interested Members would further evaluate the bill before the
bill would be considered by the Senate. Based on that further
evaluation, an amendment to H.R. 2336 will be offered, and a
recommendation will be made that the Senate adopt the amendment
and pass the bill as so amended. As so amended, the bill would
extend the authority to redact for an additional 4 years, until
December 31, 2005.
II. Background and Need for Legislation
A. EXISTING LAW AND ITS IMPLEMENTATION
Under the Ethics in Government Act of 1978 (5 U.S.C. app.),
judges and certain other officers and employees of the
judiciary, like officers and employees in other branches of
government, must file annual financial disclosure reports.
However, considering the nature of the judicial function and
the security risk it entails, the 105th Congress enacted
section 7 of the ``Identity Theft and Assumption Deterrence Act
of 1998'' (Public Law No. 105-318), adding a new subsection
105(b)(3) to the Ethics in Government Act, which provides that
the financial disclosure reports filed by judges and other
judiciary personnel may be redacted before being made available
to the public ``if a finding is made by the Judicial
Conference, in consultation with the United States Marshals
Service, that revealing personal and sensitive information
could endanger that individual.'' 1
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\1\ This quotation omits an apparent typographical error in the
United States Code, which refers to the ``United States Marshall
Service.''
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The Judicial Conference has adopted regulations governing
public access to financial disclosure reports filed by judges
and other judicial employees under the Ethics in Government
Act. Under these regulations, the Judicial Conference delegated
to its Committee on Financial Disclosure the responsibility for
implementing the financial disclosure requirements, and the
regulations set forth the procedure by which members of the
public may obtain access to the financial disclosure reports
and by which decisions to redact the reports are made.
The regulations restate a requirement, which is established
generally under the Ethics in Government Act, that any request
from a member of the public for access to a financial
disclosure form must be in writing and must identify the
requester and any other person on whose behalf the request is
made. The regulations further provide that, when a request is
received, the Committee will immediately notify the judge (or
other employee who filed the requested report) and will send
the judge (or other filer) a copy of the request.
The judge (or other filer) may request redactions when
filing the annual report, and may also request redactions upon
receiving notification of a request from a member of the public
for access to the report. In requesting a redaction, the filer
must state specifically what material is sought to be redacted
and provide detailed reasons justifying the redaction. The
Committee on Financial Disclosure then determines, in
consultation with the United States Marshals Service, whether
the information sought to be redacted could endanger the filer
and either grants or denies the request accordingly. A judge
(or other filer) whose request for redaction is denied may
appeal to a Special Redaction Review Panel of the Judicial
Conference. The Committee may also redact information without a
request if it receives evidence that release of information
could endanger the filer. The regulations provide that the
redaction is allowed to the extent necessary to protect the
filer, and for as long as the reasons for redaction exist.
The Administrative Office of the U.S. Courts provided to
the Governmental Affairs Committee detailed information about
the implementation of the redaction authority. In the calendar
year 2000, financial disclosure reports were filed by 2357
judges, of whom 179 requested redaction. Of these requests, 108
were granted in full by the Committee on Financial Disclosure,
32 were granted in part and denied in part, and 39 were denied
in full. Sixteen judges appealed these decisions, and all 16
appeals were denied.
Of the 140 judges whose redaction requests were approved in
full or in part, 59 judges' approved requests were based on
specific threats such as high-threat trials, ongoing Marshals
Service investigations, or continuing threats and financial
harassment. For 81 judges, the approved redaction requests were
based on what the Judicial Conference calls ``general
threats,'' without a specific identified threat against the
judge, but these ``general threat'' redactions applied only to
information that would disclose the workplace, school, home, or
other unsecured locations of judges or their family members.
For the 140 judges whose reports were redacted during the
year 2000, a total of 218 individual disclosure reports were
partially redacted, and a total of 13 individual reports were
totally redacted. In each instance where a report was redacted
in its entirety, the Committee on Financial Disclosure had
determined that the judge who filed the report or reports was
subject to a specific, active security threat.
B. Governmental Affairs Committee's Consideration of H.R. 2336
As enacted in 1998, the provision of the Ethics in
Government Act authorizing the judiciary to redact financial
disclosure reports included an approximately three-year sunset
clause, under which the authority will expire on December 31,
2001, unless the authority is extended by Congress. H.R. 2336
would strike the sunset clause, thereby making the redaction
authority permanent. H.R. 2336 was introduced on June 27, 2001
and passed the House of Representatives on October 16, 2001.
The Governmental Affairs Committee considered the bill at
its business meeting on November 14, 2001. At that meeting, no
Committee Member spoke in opposition to favorably reporting the
bill, but certain Members did express concerns. Senator
Thompson noted that in some instances the redaction authority
was used to avoid revealing stocks and other financial assets
owned by judges, gifts in the form of trips taken by judges,
and other gifts received by judges. This is a problem, he said,
because financial assets and gifts can produce a conflict of
interest. He stated that the redaction authority should not be
used for financial assets or gifts of this kind and that he
expects the Judicial Conference and the Administrative Office
of the Courts to take notice of these concerns. Senator Bunning
raised the point as to why authority to redact financial
disclosure statements was only granted for judges and other
officers and employees of the judiciary. He noted that U.S.
Attorneys, Assistant U.S. Attorneys, and other federal
personnel could be equally at risk from certain information in
their financial disclosure statements. Redaction authority does
not apply for them, and Senator Bunning raised the issue as to
whether or not redaction authority should apply for those and
other federal personnel.
The Committee decided to report the bill favorably to the
Senate, but, in light of the concerns expressed, the Committee
agreed that Members would have an opportunity to further
evaluate the legislation and to resolve any doubts before the
bill would be considered on the Senate floor. The Committee
proceeded to convene a meeting with a representative of the
Administrative Office of the Courts, to obtain additional
information about the Judicial Conference's implementation of
the redaction authority and to discuss the concerns that had
been expressed about that implementation.
The information considered by the Committee indicates that
the judiciary's current implementation of the redaction
authority is prudent and responsible overall. However, to
address specific concerns raised by certain Committee Members,
the following steps are being taken. An amendment to H.R. 2336
will be offered, and a recommendation will be made that the
Senate adopt the amendment and pass the bill as so amended, to
extend the redaction authority for 4 years, until December 31,
2005, rather than now making the authority permanent. This 4-
year sunset period will give the Committee or interested
Members an opportunity to inquire further into specific areas
of concern regarding the implementation of the redaction
authority, to evaluate any responses by the judiciary to these
concerns, and to consider whether any legislative changes to
the redaction authority are necessary.2 This will
also provide an opportunity to look into whether the redaction
authority, which is an exception to the generally applicable
provisions of the Ethics in Government Act, should apply only
to the judiciary, as it does now, or whether the authority
should also apply to U.S. Attorneys or others outside of the
judicial branch.
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\2\ A representative of the Administrative Office of the U.S.
Courts also advised the Committee that copies of the annual reports
required by section 105(b)(3)(C) of the Ethics in Government Act will
in the future be sent to the Committee.
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Although the judiciary has generally exercised the
redaction authority well, the Committee has some specific
concerns about certain ways in which the redaction authority
has been used since it was enacted three years ago with a
three-year sunset. The Committee hopes that the judiciary will
examine whether any of the Committee's observations might
warrant changes in the operative regulations.
The Committee understands that, although the redaction
authority has not been used often to withhold a judge's entire
financial disclosure report, such complete withholding has,
upon the recommendation of the United States Marshals Service,
occurred on occasion. The Committee believes that the intent of
the legislation is to authorize withholding only that specific
information that could endanger judges. Even if the information
in one section of a report must be redacted, it may be safe to
release another section of the report that either contains
information posing no danger or that is blank because the judge
had nothing relevant to disclose. The Committee questions
whether it would ever be necessary to withhold every part of a
judge'sreport. The Committee has shared this view with the
Administrative Office of the U.S. Courts, which has indicated that the
judiciary plans to use redaction authority in the future with a
careful, section-by-section review and decision so that only the
information that could endanger the filer would be redacted from a
disclosure report. The Committee appreciates that position and hopes
that the Judicial Conference will consider modifying its regulations to
clarify its intent in that regard.
The Committee also believes that the judiciary might desire
to review its practices with respect to the redaction of
financial assets. A judge's financial assets can potentially
create a conflict of interest. Redaction of those assets could
therefore prevent the public from learning that a conflict was
present in a case. On the other hand, under some circumstances,
disclosing financial assets might enable a hostile person to
learn a judge's home address or might otherwise pose a danger.
But there may be ways to maintain judicial safety through ways
other than redacting the holdings. For instance, it may be
worth considering whether holding assets in a brokerage account
in ``street name,'' 3 or using a mailing address
other than the judge's home address in connection with
ownership of the assets, might eliminate danger that might
otherwise arise from publicly identifying the assets. The
judiciary might consider whether, if measures like these were
used, redaction of financial assets might be unnecessary.
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\3\ Holding securities in ``street name'' means that the broker
holds the securities in its name or in the name of another nominee,
rather than the securities being held in the name of the real, or
``beneficial,'' owner.
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Additionally, some redactions have been made with respect
to reimbursement for travel to various conferences. The
Committee has some difficulty understanding why this redaction
has occurred, and has communicated its reservations to the
Administrative Office of the U.S. Courts. Although a judge
could be harmed by someone learning that a judge was attending
a conference as it was occurring, the judge would have long
since left that location by the time the reimbursement of the
expense was reported. The Administrative Office has advised
that no judge has asked that reimbursed travel be redacted, but
that such items have been redacted in several occasions where
the financial disclosure report was redacted in its entirety.
(Concerns about some reports having being redacted in their
entirety were discussed above.) Especially in light of the fact
that a number of reimbursements have inadvertently not been
reported at all, the Committee suggests that the judiciary
review its policies for redacting information of that type, and
consider whether to strengthen its enforcement or other
compliance policies for assuring that judges comply with the
legal obligation to disclose reimbursed travel.
In considering the rationale for the redaction authority,
the Committee understands that the need to reveal information
that can potentially create a conflict of interest may be
outweighed when disclosing the information might reveal the
location of a judge or family member at an insecure location or
might otherwise endanger the individual physically. But, in
extending the program, the Committee believes that where the
reason stops, so should the rule. Thus, redactions made not to
protect a judge from a threat to his or her person, but to stop
false liens from being placed on a piece of property or to
prevent ``theft of identity,'' may not fit within the rationale
for the redaction authority. The Committee believes that the
judiciary might want to review its use of the redaction
authority in this context. The judiciary might also want to
evaluate whether decisions to grant waivers to disclosure
should be made public.
The Committee believes that the judiciary is undertaking
strong efforts to ensure that assets and reimbursements are
disclosed, but recognizes that public confidence in that
process is necessary even if all information required to be
disclosed is in fact disclosed. This is true for redacted
information as well. Ultimately, a well-functioning redacting
process is in the interest of both the judiciary and the
public. The Committee believes that the Judicial Conference has
been conscientious in its review of judicial requests for
individualized redactions, and appreciates that appeals of
rulings adverse to individual judges have not been granted when
the Conference believes they are not warranted.
These suggestions are offered in an effort to be helpful,
rather than critical. The judiciary can determine for itself
which, if any, it might choose to consider. The Committee
appreciates the reactions it has received to some of these
ideas from the Administrative Office of the U.S. Courts, and
looks forward to further reviewing the operation of the
program.
III. Legislative History
H.R. 2336 was introduced on June 27, 2001, by Congressman
Coble, for himself and Congressman Berman, and was referred to
the House Committee on the Judiciary. No hearings were held,
and on October 2, 2001, the House Judiciary Committee ordered
the bill favorably reported by voice vote. The bill was then
considered in the House on October 16, 2001, under suspension
of the rules and passed by voice vote.
In the Senate, H.R. 2336 was referred to the Committee on
Governmental Affairs. No hearings were held on the legislation.
H.R. 2336 was considered by the Committee at its business
meeting on November 14, 2001, and was ordered reported
favorably, without amendment, by voice vote. When ordering the
bill reported, the Committee agreed that Members would further
evaluate the bill before the bill would be considered by the
Senate. Committee members present were Senators Akaka, Durbin,
Cleland, Carper, Carnahan, Thompson, Voinovich, Cochran,
Bunning, and Lieberman.
Based on that further evaluation, it was decided that an
amendment to H.R. 2336 will be offered, and a recommendation
will be made that the Senate adopt the amendment and pass the
bill as so amended. As so amended, the bill would not make the
redaction authority permanent, but would instead extend the
authority for 4 years, until December 31, 2005.
IV. Regulatory Impact Statement
Paragraph 11(b)(1) of rule XXVI of the Standing Rules of
the Senate requires that each report accompanying a bill
evaluate the ``regulatory impact which would be incurred in
carrying out this bill.'' Carrying out H.R. 2336 would have no
regulatory impact.
V. Congressional Budget Office Cost Estimate
U.S. Congress,
Congressional Budget Office,
Washington, DC, November 19, 2001.
Hon. Joseph I. Lieberman,
Chairman, Committee on Governmental Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2336, a bill to
make permanent the authority to redact financial disclosure
statements of judicial employees and judicial officers.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Lanette J.
Walker.
Sincerely,
Steven Lieberman
(For Dan L. Crippen, Director).
Enclosure.
H.R. 2336--A bill to make permanent the authority to redact financial
disclosure statements of judicial employees and judicial
officers.
H.R. 2336 would repeal the sunset provision in the Ethics
in Government Act of 1978 relating to the authority of certain
judicial employees and judicial officers to revise their
financial disclosure statements. CBO estimates that
implementing H.R. 2336 would have no significant impact on the
federal budget. The bill would not affect direct spending or
receipts; therefore, pay-as-you-go procedures do not apply.
H.R. 2336 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would impose no costs on state, local, or tribal governments.
On October 12, 2001, CBO transmitted a cost estimate for
H.R. 2336 as ordered reported by the House Committee on the
Judiciary on October 3, 2001. The two versions of the
legislation and our cost estimates are identical.
The CBO staff contact for this estimate is Lanette
J.Walker. This estimate was approved by Peter H. Fontaine,
Deputy Assistant Director for Budget Analysis.
VI. Changes to Existing Law
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
H.R. 2336, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in brackets, new matter is
printed in italic, and existing law in which no change is
proposed is shown in roman):
UNITED STATES CODE
TITLE 5--GOVERNMENT ORGANIZATION AND EMPLOYEES
* * * * * * *
TITLE 5--APPENDIX
ETHICS IN GOVERNMENT ACT OF 1978
TITLE I--FINANCIAL DISCLOSURE REQUIREMENTS OF FEDERAL PERSONNEL
* * * * * * *
Sec. 105. Custody of and public access to reports
* * * * * * *
(b)(1) * * *
* * * * * * *
(3)(A) * * *
* * * * * * *
[(E) This paragraph shall expire on December 31, 2001, and
apply to filings through calendar year 2001.]