[Federal Register Volume 61, Number 189 (Friday, September 27, 1996)]
[Rules and Regulations]
[Pages 50689-50691]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-24581]


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OFFICE OF GOVERNMENT ETHICS

5 CFR Part 2635

RIN 3209-AA04


Standards of Ethical Conduct for Employees of the Executive 
Branch; Exception for Gifts From a Political Organization

AGENCY: Office of Government Ethics (OGE).

ACTION: Interim rule with request for comments.

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SUMMARY: The Office of Government Ethics is amending the Standards of 
Ethical Conduct for Employees of the Executive Branch to conform with 
the Hatch Act Reform Amendments of 1993.

[[Page 50690]]

These amendments will thus bring the concerned provisions of the 
Standards up-to-date.

DATES: These interim rule amendments are effective September 27, 1996. 
Comments are invited and must be received on or before November 26, 
1996.

ADDRESSES: Send comments to the Office of Government Ethics, Suite 500, 
1201 New York Avenue, NW., Washington, DC 20005-3917, Attention: Stuart 
D. Rick.

FOR FURTHER INFORMATION CONTACT: Stuart D. Rick, Associate General 
Counsel, Office of Government Ethics; telephone: 202-208-8000; FAX: 
202-208-8037; Internet E-mail address: [email protected] (for E-mail 
messages, the subject line should include the following reference--
Standards Exception/Political Organization Gifts).

SUPPLEMENTARY INFORMATION:

I. Background

    On August 7, 1992, the Office of Government Ethics published the 
Standards of Ethical Conduct for Employees of the Executive Branch (the 
Standards) for codification at 5 CFR part 2635. See 57 FR 35006-35067, 
as corrected at 57 FR 48557, 57 FR 52583, and 60 FR 51667, with 
additional grace period extensions for certain existing provisions at 
59 FR 4779-4780, 60 FR 6390-6391, and 60 FR 66857-66858. The Standards, 
which took effect on February 3, 1993, set uniform ethical conduct 
standards applicable to all executive branch personnel.
    Subpart B of the Standards, which contains regulations implementing 
the gift restrictions contained in 5 U.S.C. 7353 and section 101(d) of 
Executive Order 12674, as modified by E.O. 12731, includes an exception 
for benefits provided by certain sources in connection with political 
activities permitted by the Hatch Act. Subpart H of the Standards, 
which contains regulations relating to the outside activities of 
employees, includes a note explaining that fundraising permitted by the 
Hatch Act is not prohibited by the Standards, and includes a reference 
to the Hatch Act in a list of statutes and regulations applicable to 
outside activities.
    The Hatch Act, at 5 U.S.C. 7321 et seq., for many years governed 
the political activities of executive branch employees. Until recently, 
the Hatch Act provided that the only executive branch employees who 
were permitted to take an active part in political management or 
political campaigns were: an employee paid from the appropriation for 
the office of the President; the head or the assistant head of an 
Executive department or military department; and an employee appointed 
by the President, by and with the advice and consent of the Senate, who 
determines policies to be pursued by the United States in its relations 
with foreign powers or in the nationwide administration of Federal 
laws. Those exceptions to the Hatch Act's coverage were codified at 5 
U.S.C. 7324(d).
    Under the Hatch Act Reform Amendments of 1993, Public Law 103-94, 
all executive branch employees, with the exception of employees in 
certain agencies and positions listed at 5 U.S.C. 7323(b) and members 
of the uniformed services, may take an active part in political 
management or political campaigns. However, no employee may knowingly 
solicit, accept, or receive a political contribution from any person 
except under limited circumstances. 5 U.S.C. 7323(a)(2). The Hatch Act 
Reform Amendments of 1993 went into effect on February 3, 1994. See 
also the regulations thereunder of the Office of Personnel Management, 
at 5 CFR 734.401 (as modified at 61 FR 35101) for a list of the 
agencies and positions in which employees are still subject to 
political activity restrictions.

II. Analysis of the Regulations

    The following sections of 5 CFR part 2635 are being amended to 
conform with the Hatch Act Reform Amendments of 1993. The Office of 
Government Ethics has consulted with the Department of Justice and the 
Office of Personnel Management on these interim rule amendments.

Section 2635.204(f)

    Section 2635.204 of the Standards sets forth exceptions to the gift 
prohibition in Sec. 2635.202(a), which provides that, in the absence of 
an exception, an employee shall not directly or indirectly solicit or 
accept a gift from a ``prohibited source,'' as that term is defined at 
5 CFR 2635.203(d), or a gift that is ``[g]iven because of the 
employee's official position,'' as that term is defined at 5 CFR 
2635.203(e).
    One of several exceptions set forth in Sec. 2635.204 is the 
exception at Sec. 2635.204(f), by which ``[a]n employee who is exempt 
under 5 U.S.C. 7324(d) from the Hatch Act prohibitions against active 
participation in political management or political campaigns may accept 
meals, lodgings, transportation and other benefits, including free 
attendance at events, when provided, in connection with such active 
participation, by a political organization described in 26 U.S.C. 
527(e).'' In order to reflect the redefined class of executive branch 
employees who, pursuant to the Hatch Act Reform Amendments of 1993, may 
take an active part in political management or political campaigns, and 
to permit those employees to accept from a political organization 
meals, lodgings, transportation and other benefits, including free 
attendance at events, when provided in connection with their active 
participation in political management or political campaigns, the 
reference in Sec. 2635.204(f) to prior 5 U.S.C. 7324(d), now 
superseded, is being replaced with a reference to current 5 U.S.C. 7323 
as revised. In addition, the exception and the example following it are 
being reworded to reflect the thrust of the Hatch Act, as amended, to 
permit political activities rather than prohibit them.

Section 2635.801(d)(7)

    Section 2635.801(d) of the Standards lists the Hatch Act among 
other statutes and regulations applicable to employees' outside 
employment or other outside activities. The brief reference to the 
Hatch Act in this section, at 5 CFR 2635.801(d)(7), is being replaced 
with a reference to the Hatch Act Reform Amendments.

Section 2635.808(a)(2)

    Section 2635.808 of the Standards describes the circumstances under 
which an employee may engage in fundraising. For purposes of 
Sec. 2635.808, ``fundraising'' means ``the raising of funds for a 
nonprofit organization, other than a political organization as defined 
in 26 U.S.C. 527(e) * * *.'' 5 CFR 2635.808(a)(1). Accordingly, a note 
following Sec. 2635.808(a)(2) explains that Sec. 2635.808 does not 
prohibit fundraising for political parties, but that such fundraising 
may be prohibited by other authorities, including the Hatch Act for 
employees ``other than those exempt under 5 U.S.C. 7324(d),'' and the 
restrictions on political solicitations in title 18 of the U.S. Code.
    The note is being reworded to refer employees to the restrictions 
in the Hatch Act Reform Amendments, at 5 U.S.C. 7323(a)(2), on the 
solicitation, acceptance, or receipt of political contributions. In 
addition, the note is being reworded for clarity and to reflect changes 
made by the Hatch Act Reform Amendments to the restrictions on 
political solicitations in title 18 of the U.S. Code.

III. Matters of Regulatory Procedure

Administrative Procedure Act

    Pursuant to 5 U.S.C. 553 (b) and (d), as Director of the Office of 
Government

[[Page 50691]]

Ethics, I have found that good cause exists for waiving the general 
requirements of notice of proposed rulemaking and 30-day delayed 
effective date for these interim rule Standards amendments. These 
requirements are being waived because it is in the public interest that 
these interim rule amendments, reflecting the broader class of 
executive branch employees who can engage in certain permitted 
political activities under the Hatch Act Reform Amendments be effective 
as soon as possible. Any comments received will be considered before 
OGE eventually adopts this interim final provision in a final rule.

Executive Order 12866

    In promulgating these interim rule amendments, the Office of 
Government Ethics has adhered to the regulatory philosophy and the 
applicable principles of regulation set forth in section 1 of Executive 
Order 12866, Regulatory Review and Planning. These amendments have also 
been reviewed by the Office of Management and Budget under that 
Executive order.

Regulatory Flexibility Act

    As Director of the Office of Government Ethics, I certify under the 
Regulatory Flexibility Act (5 U.S.C. chapter 6) that this amendatory 
rule will not have a significant economic impact on a substantial 
number of small entities because it primarily affects Federal executive 
branch employees.

Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply 
because these amendments do not contain information collection 
requirements that require the approval of the Office of Management and 
Budget.

List of Subjects in 5 CFR Part 2635

    Conflict of interests, Executive branch standards of conduct, 
Government employees, Political activities (Government employees).

    Approved: July 26, 1996.
Stephen D. Potts,
Director, Office of Government Ethics.

    Accordingly, for the reasons set forth in the preamble, the Office 
of Government Ethics is amending part 2635 of subchapter B of chapter 
XVI of title 5 of the Code of Federal Regulations as follows:

PART 2635--[AMENDED]

    1. The authority citation for part 2635 continues to read as 
follows:

    Authority: 5 U.S.C. 7351, 7353; 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.

Subpart B--Gifts From Outside Sources

    2. Section 2635.204 is amended by revising paragraph (f) and the 
example following it, to read as follows:


Sec. 2635.204  Exceptions.

* * * * *
    (f) Gifts in connection with political activities permitted by the 
Hatch Act Reform Amendments. An employee who, in accordance with the 
Hatch Act Reform Amendments of 1993, at 5 U.S.C. 7323, may take an 
active part in political management or in political campaigns, may 
accept meals, lodgings, transportation and other benefits, including 
free attendance at events, when provided, in connection with such 
active participation, by a political organization described in 26 
U.S.C. 527(e). Any other employee, such as a security officer, whose 
official duties require him to accompany an employee to a political 
event may accept meals, free attendance and entertainment provided at 
the event by such an organization.

    Example 1: The Secretary of the Department of Health and Human 
Services may accept an airline ticket and hotel accommodations 
furnished by the campaign committee of a candidate for the United 
States Senate in order to give a speech in support of the candidate.
* * * * *

Subpart H--Outside Activities

    3. Section 2635.801 is amended by revising paragraph (d)(7) to read 
as follows:


Sec. 2635.801  Overview.

* * * * *
    (d) * * *
    (7) The Hatch Act Reform Amendments, 5 U.S.C. 7321 through 7326, 
which govern the political activities of executive branch employees;
* * * * *
    4. Section 2635.808 is amended by revising the note following 
paragraph (a)(2) to read as follows:


Sec. 2635.808  Fundraising activities.

* * * * *
    (a) * * *
    (2) * * *

    Note: This section does not prohibit fundraising for a political 
party, candidate for partisan political office, or partisan 
political group. However, there are statutory restrictions that 
apply to political fundraising. For example, under the Hatch Act 
Reform Amendments of 1993, at 5 U.S.C. 7323(a), employees may not 
knowingly solicit, accept, or receive a political contribution from 
any person, except under limited circumstances. In addition, 
employees are prohibited by 18 U.S.C. 607 from soliciting or 
receiving political contributions in Federal offices, and, except as 
permitted by the Hatch Act Reform Amendments, are prohibited by 18 
U.S.C. 602 from knowingly soliciting political contributions from 
other employees.
* * * * *
[FR Doc. 96-24581 Filed 9-26-96; 8:45 am]
BILLING CODE 6345-01-P