[Federal Register Volume 60, Number 44 (Tuesday, March 7, 1995)]
[Rules and Regulations]
[Pages 12396-12398]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-5553]



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OFFICE OF MANAGEMENT AND BUDGET

5 CFR Part 1300 and Chapter LXXVII

RIN 3209-AA15


Supplemental Standards of Ethical Conduct for Employees of the 
Office of Management and Budget

AGENCY: Office of Management and Budget (OMB).

ACTION: Final rule.

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SUMMARY: The Office of Management and Budget, with the concurrence of 
the Office of Government Ethics (OGE), is issuing regulations for 
employees of the OMB that supplement the Standards of Ethical Conduct 
for Employees of the Executive Branch issued by OGE with a requirement 
for prior approval of outside employment. The Office of Management and 
Budget also is repealing its old standards of conduct regulations and 
is inserting in their place a cross-reference to the new provisions and 
to applicable executive branch-wide standards of ethical conduct, as 
well as to applicable financial disclosure regulations.

EFFECTIVE DATE: These regulations are effective on March 7, 1995.

FOR FURTHER INFORMATION CONTACT: Darrell A. Johnson, OMB Designated 
Agency Ethics Official (DAEO), (202) 395-5715, or McGavock D. Reed, OMB 
Alternate DAEO, (202) 395-3563.

SUPPLEMENTARY INFORMATION:

I. Background

    On August 7, 1992, OGE published new Standards of Ethical Conduct 
for Employees of the Executive Branch (Standards). See 57 FR 35006-
35067, as corrected at 57 FR 48557 and 57 FR 52583, with additional 
grace period extensions at 59 FR 4779-4780 and 60 FR 6390-6391. The 
Standards, codified at 5 CFR part 2635 and effective February 3, 1993, 
established uniform standards of ethical conduct that apply to all 
executive branch personnel.
    With the concurrence of OGE, 5 CFR 2635.105 authorizes executive 
branch agencies to publish agency-specific supplemental regulations 
necessary to implement their respective ethics programs. With OGE's 
concurrence, OMB has determined that the following supplemental 
regulations, being codified in new 5 CFR chapter LXXVII, consisting of 
part 8701, are necessary to the success of its ethics program. The 
Office of Management and Budget is simultaneously repealing its 
superseded Standards of Conduct at 5 CFR part 1300 and is replacing 
those provisions with a single section that provides cross-references 
to 5 CFR parts 2634 and 2635, and to OMB's new supplemental 
regulations.

II. Analysis of the Regulations

Section 8701.101  General

    Section 8701.101 explains that the regulations contained in the 
final rule will apply to all OMB employees and are supplemental to the 
executive branch-wide standards. Employees of OMB also are subject to 
the Standards of Ethical Conduct for Employees of the Executive Branch 
at 5 CFR part 2635 and the executive branch financial disclosure 
regulations at 5 CFR part 2634.

Section 8701.102  Prior Approval for Outside Employment

    Under 5 CFR 2635.803, agencies may, by supplemental regulation, 
require employees to obtain prior approval before engaging in outside 
employment. Under 5 CFR 1300.735-15(b) which is now being revoked, OMB 
employees have long been required to obtain advance approval for 
outside employment, and OMB has determined that it is necessary to the 
administration of its ethics program to continue to require that 
employees obtain prior approval before engaging in outside employment. 
New paragraph 8701.102, therefore, continues the basic requirement for 
prior approval of outside employment. By adding a definition of 
``employment,'' however, it clarifies the circumstances under which 
prior approval must be obtained and, by specifying the information to 
be provided as part of the employee's request, it provides additional 
guidance for employees who are required to submit requests for 
approval.
    Whereas 5 CFR 1300.735-15(b) had specified that approval was to be 
obtained from the Assistant to the Director for Administration, section 
8701.102 contains a multiple approval requirement. In addition to the 
approval of his or her division of office head, the employee must 
obtain the approval of the OMB General Counsel, as well as that of the 
designated agency ethics official.
    The standard to be used in approving or denying requests for 
approval of outside employment is set forth at section 8701.102(b), in 
part, to highlight [[Page 12397]] the fact that section 8701.102 does 
not itself provide a basis to deny any OMB employee's request for 
approval. The basis for disapproval, if any, must be found in 
applicable statutes or the executive branch-wide Standards.

III. Repeal of the Old OMB Standards of Conduct Regulations

    Because the OMB's Standards of Conduct have been largely superseded 
by the new executive branch financial disclosure regulations at 5 CFR 
parts 2634 and by the new executive branch-wide Standards at 5 CFR part 
2635 as supplemented by the regulations contained in new 5 CFR part 
8701, OMB is repealing all of existing 5 CFR part 1300. To ensure that 
employees are on notice of the ethical standards to which they are 
subject, the OMB is replacing its old standards at 5 CFR part 1300 with 
a residual provision that cross-references 5 CFR parts 2634, 2635 and 
8701.

IV. Matters of Regulatory Procedure

Administrative Procedure Act

    The Office of Management and Budget has found that good cause 
exists under 5 U.S.C. 553(b) and (d)(3) for waiving, as unnecessary and 
contrary to the public interest, the general notice of proposed 
rulemaking and the 30 day delay in effectiveness as to this final rule 
and repeal. This supplemental regulation is essentially a restatement 
of a rule previously contained in the OMB Standards of Conduct. 
Furthermore, this rulemaking is related to the OMB organization, 
procedure and practice.

Executive Order 12866

    In promulgating this final rule, OMB has adhered to the regulatory 
philosophy and the applicable principles of regulations set forth in 
section 1 of Executive Order 12866, Regulatory Planning and Review. 
This regulation is not deemed ``significant'' under that Executive 
order.

Regulatory Flexibility Act

    The Office of Management and Budget has determined under the 
Regulatory Flexibility Act (5 U.S.C. chapter 6) that this regulation 
will not have a significant impact on small business entities because 
it affects only OMB employees.

Paperwork Reduction Act

    The Office of Management and Budget has determined that the 
Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply because 
this regulation does not contain any information collection 
requirements.

Environmental Impact

    This decision will not have a significant impact upon the quality 
of the human environment or the conservation of energy resources.

List of Subjects

5 CFR Part 1300

    Conflict of interest, Government employees.

5 CFR Part 8701

    Conflict of interests, Executive branch standards of conduct, 
Government employees.

    Dated: February 7, 1995.
Robert G. Damus,
General Counsel, Office of Management and Budget.

    Approved: February 13, 1995.
Stephen D. Potts,
Director, Office of Government Ethics.

    For the reasons set forth in the preamble, the Office of Management 
and Budget, with the concurrence of the Office of Government Ethics, is 
amending title 5 of the Code of Federal Regulations as follows:

TITLE 5--[AMENDED]

5 CFR CHAPTER III--OFFICE OF MANAGEMENT AND BUDGET
    1. Part 1300 of 5 CFR chapter III is revised to read as follows:

PART 1300--STANDARDS OF CONDUCT


Sec. 1300.1  Cross-reference to employees ethical conduct standards and 
financial disclosure regulations.

    Employees of the Office of Management and Budget are subject to the 
executive branch-wide standards of ethical conduct at 5 CFR part 2635, 
OMB's regulations at 5 CFR part 8701 which supplement the executive 
branch-wide standards, and the executive branch-wide financial 
disclosure regulations at 5 CFR part 2634.

    Authority: 5 U.S.C. 7301.

    2. A new chapter LXXVII, consisting of part 8701, is added to title 
5 of the Code of Federal Regulations to read as follows:
5 CFR CHAPTER LXXVII--OFFICE OF MANAGEMENT AND BUDGET

PART 8701--SUPPLEMENTAL STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES 
OF THE OFFICE OF MANAGEMENT AND BUDGET

Section 8701.101  General.
Section 8701.102  Prior approval for outside employment.

    Authority: 5 U.S.C. 7301; 5 U.S.C. App. (Ethics in Government 
Act of 1978); E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp. p. 215, as 
modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306; 5 
CFR 2635.105, 2635.803.


Sec. 8701.101  General.

    In accordance with 5 CFR 2635.105, the regulations in this part 
apply to the employees of the Office of Management and Budget and 
supplement the Standards of Ethical Conduct for Employees of the 
Executive Branch contained in 5 CFR part 2635. In addition to the 
standards in 5 CFR part 2635 and this part, OMB employees are subject 
to the executive branch financial disclosure regulations contained in 5 
CFR part 2634.


Sec. 8701.102  Prior approval for outside employment.

    (a) Before engaging in outside employment with or without 
compensation, an employee of the Office of Management and Budget, other 
than a special Government employee, must obtain the written approval of 
his or her division or office head, the General Counsel, and the 
Designated Agency Ethics Official (DAEO). Requests for approval shall 
be forwarded through normal supervisory channels to the division or 
office head, who shall forward the request to the General Counsel, to 
be forwarded with their successive approvals to the DAEO. The request 
for approval shall include, at a minimum, the following:
    (1) A statement of the name of the person, group, or other 
organization for whom the work is to be performed; the type of work to 
be performed; and the proposed hours of work and approximate dates of 
employment; and
    (2) A statement that the outside employment will not depend on 
information obtained as a result of the employee's official Government 
position and that no official duty time or Government property, 
resources, or facilities not available to the general public will be 
used in connection with the outside employment.
    (b) Approval shall be granted only upon a determination that the 
outside employment is not expected to involve conduct prohibited by 
statute or Federal regulation, including 5 CFR part 2635.
    (c) For purposes of this section, ``employment'' means any form of 
non-Federal employment or business relationship involving the provision 
of personal services by the employee. It includes, but is not limited 
to, personal services as an officer, director, employee, agent, 
attorney, consultant, contractor, general partner, trustee, teacher or 
speaker. It includes writing [[Page 12398]] when done under an 
arrangement with another person for production or publication of the 
written product. It does not, however, include participation in the 
activities of a nonprofit charitable, religious, professional, social, 
fraternal, educational, recreational, public service, or civic 
organization, unless such activities involve the provision of 
professional services or advice or are for compensation other than 
reimbursement of expenses.

[FR Doc. 95-5553 Filed 3-6-95; 8:45 am]
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