[Federal Register Volume 65, Number 61 (Wednesday, March 29, 2000)]
[Rules and Regulations]
[Pages 16511-16513]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-7769]



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  Federal Register / Vol. 65, No. 61 / Wednesday, March 29, 2000 / 
Rules and Regulations  

[[Page 16511]]



OFFICE OF GOVERNMENT ETHICS

5 CFR Part 2640

RIN 3209-AA09


Exemption Under 18 U.S.C. 208(b)(2) for Financial Interests of 
Non-Federal Government Employers in the Decennial Census

AGENCY: Office of Government Ethics (OGE).

ACTION: Interim rule with request for comments.

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SUMMARY: The Office of Government Ethics is issuing an interim 
regulation that would permit certain temporary employees of the 
Department of Commerce Bureau of the Census (the Bureau) who have been 
hired under authority of 13 U.S.C. 23 to perform duties in connection 
with the decennial census, notwithstanding these employees' 
disqualifying financial interest under 18 U.S.C. 208(a) arising from 
the interests of their non-Federal employers.

DATES: This interim regulation is effective March 29, 2000. Comments 
are invited and are due by April 28, 2000.

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

FOR FURTHER INFORMATION CONTACT: Karen Kimball, Associate General 
Counsel, Office of Government Ethics; telephone: 202-208-8000; TDD: 
202-208-8025; FAX: 202-208-8037; Internet E-mail address: 
[email protected]. For E-mail messages, the subject line should include the 
following reference: Interim Rule Exemption Under 18 U.S.C. 208(b)(2).

SUPPLEMENTARY INFORMATION: Section 208(a) of title 18 of the United 
States Code prohibits Government employees from participating in an 
official capacity in particular Government matters in which, to their 
knowledge, they, or, inter alia, any organization in which they are 
serving as an employee, have a financial interest, if the particular 
matter would have a direct and predictable effect on that interest. 
Section 208(b)(2) of title 18 permits the Office of Government Ethics 
to promulgate executive branchwide regulations describing financial 
interests that are too remote or inconsequential to warrant 
disqualification pursuant to section 208(a).
    On December 18, 1996, the Office of Government Ethics published an 
executive branchwide final rule, ``Interpretation, Exemptions and 
Waiver Guidance Concerning 18 U.S.C. 208 (Acts Affecting a Personal 
Financial Interest),'' which as corrected is now codified at 5 CFR part 
2640. The regulation describes financial interests that OGE has 
determined are either too remote or too inconsequential to affect an 
employee's consideration of any particular matter. Employees who have 
these financial interests, or who have such interests that are imputed 
to them, are permitted, to the extent described in the final 
regulation, to participate in matters affecting such interests 
notwithstanding the general prohibition in section 208(a).
    In order to carry out its decennial census responsibilities, the 
Bureau of the Census must hire approximately 800,000 temporary 
employees throughout the country, primarily to assist in the 
enumeration process. Current historic low unemployment rates and 
demographic and societal changes have rendered traditional sources of 
decennial census workers insufficient. The Bureau, therefore, must 
engage in vigorous recruitment efforts to obtain needed personnel. 
Potential sources of such workers are likely to include teachers and 
other State, local, or tribal government workers who are available to 
work nights and weekends. The recruitment of these workers is time-
sensitive because of the Constitutional mandate to conduct the census 
during calendar year 2000. The majority of workers are hired within a 
period of a few weeks.
    The Bureau of the Census has authority under 13 U.S.C. 23 to hire 
temporary employees, ``including employees of Federal, State, or local 
agencies or instrumentalities * * * to assist the Bureau'' in 
conducting the census. See 13 U.S.C. 23(c). That statute grants no 
express relief from the application of 18 U.S.C. 208.
    State, local, and tribal governments have a financial interest in 
the decennial census. Census results are used to apportion funds among 
the States and among jurisdictions within the States in connection with 
entitlements under a number of Federal and State programs. We note that 
the results of the census also are used to allocate representation 
among the States in the United States House of Representatives and in 
State legislatures which, presumably, affects a State's ability to 
pursue its interests, including financial interests.
    Conflict-of-interest concerns arise regarding decennial census 
workers who are directly involved in the enumeration process or in the 
supervisory chain of command for workers involved in that process. Such 
employees may be participating personally and substantially in 
particular matters that have a direct and predictable effect on the 
financial interests of their non-Federal government employer within the 
meaning of 18 U.S.C. 208(a). These employees' participation may be 
``personal and substantial'' as those terms are defined in 5 CFR 
2635.402(b)(4) of OGE's executive branch standards of ethical conduct 
and 5 CFR 2640.103(a)(2) of the OGE executive branchwide personal 
financial interests regulation because they participate directly in the 
determination of the census count and the numbers which their work 
produces are the substance of the census. Their work is the basis on 
which the census count is determined and, thus, their work is of 
significance to the matters. The decennial census and its 
administration in various States and localities may be ``particular 
matters'' as defined by 5 CFR 2635.402(b)(3) and 2640.103(a)(1), 
because the matters involve deliberation, decision, or action that is 
focused upon the interests of specific persons or on a discrete and 
identifiable class of persons.
    As participation in census matters may be a conflict of interest 
pursuant to 18 U.S.C. 208(a), decennial census workers need to know 
whether they can lawfully engage in the activities required by their 
employment. Also,

[[Page 16512]]

since all aspects of the work that enumerators and their supervisors 
will do is related to the determination of the census numbers, it would 
not be possible to disqualify these employees from working on these 
matters and have them perform services for the agency. Granting waivers 
or creating an exemption is an appropriate method for removing any 
legal uncertainty about whether the conflict-of-interest laws in title 
18 apply.
    In the view of the Department of Commerce, as the department 
responsible for the administration of the census program, the financial 
interests of the non-Federal government employers in the work that 
these temporary census employees perform are both too remote and too 
inconsequential to affect the integrity of the services which the 
United States Government may expect from these employees for the 
following reasons. The nature of the work to be performed is basic data 
gathering and lower level supervision of the data gathering. No 
employee in a position covered by the new exemption in this interim 
rule would be able to affect the count for any census statistical unit 
to any significant degree due to the extent of the data gathering, the 
fragmentation of the data-gathering process, and the several quality 
checking and verification processes that the Department of Commerce has 
imposed. Additionally, the work of these employees is too far removed 
from the financial interests of their non-Federal government employers 
due to the number of independent intervening steps in the census 
process before final census determinations are made. Thus, the work of 
these employees is inconsequential to those financial interests due to 
the limited scope of their duties. Any risks regarding the conduct of 
an inaccurate and biased census are remote.
    In addition, the scope of the exemption is very narrow and will not 
apply to cover those serving in State, local, and tribal government 
positions which are filled through public election. While elected 
officials would not be able to distort the census count to any 
significant degree because of the procedures that Commerce has imposed 
and the limited scope of temporary census employees' duties, there is a 
heightened concern about appearances arising from the greater interest 
elected officials have regarding the impact of the census count on 
their employers. The exclusion of such employees from the exemption and 
the narrowness of the exemption also address any concerns that the 
census count might appear to be biased or inaccurate.
    The Department of Commerce, under authority of 18 U.S.C. 208(b)(1), 
could issue individual waivers after determining that the employees' 
disqualifying financial interests are not so substantial as to be 
deemed likely to affect the integrity of the services which the 
Government may expect from them. However, senior officials at the 
Bureau of the Census have determined that it is administratively 
impractical to implement a system which would assure that individual 
waivers are granted due to the scale of the workforce it expects to 
hire, the decentralized nationwide hiring process, and the streamlined 
hiring process that must be utilized to meet the personnel needs 
required by the decennial census. According to Bureau of the Census 
officials, it would not be feasible to issue individual waivers due to 
the volume of personnel actions anticipated. Hundreds of thousands of 
positions need to be filled within a three- to four-week period for 
employment lasting six to eight weeks. In addition, most of this hiring 
process is administered by temporary clerks who are employed scarcely 
longer than those whose positions they are attempting to fill. These 
clerks are required to follow a multitude of complex procedures in 
order legally to hire and pay new employees. Bureau of the Census 
officials have concluded that having these clerks perform an additional 
step to determine whether the new employees are employed by State, 
local, or tribal government employers in order to determine whether a 
conflict of interest waiver is required is an unjustified use of very 
limited time. They also believe that such a process would be 
inconsistent with permission the Bureau of the Census received from the 
Office of Management and Budget to reduce and consolidate the number of 
forms that must be completed for each employee at the time of 
appointment. The Office of Management and Budget's agreement has 
permitted the Bureau to streamline its hiring process for the 2000 
Census, minimizing the administrative burden wherever possible. Under 
these circumstances, the Bureau believes that only a regulatory waiver 
will address the Bureau's administrative needs and will provide 
reliable protection from inadvertent violations of the conflict of 
interest statute.
    Based on the determinations of the Commerce Department and the 
Census Bureau, OGE has decided to issue this interim rule exemption. 
Accordingly, this interim regulation provides an exemption for the 
financial interests of State, local, or tribal government employers 
whose employees are hired on a temporary basis by the Department of 
Commerce under authority of 13 U.S.C. 23 to participate in activities 
related to the conduct of the decennial census. While still employed by 
State, local, or tribal governments, the employees also work on a part-
time or intermittent basis at the Bureau of the Census in a Local 
Census Office or in an Accuracy and Coverage Evaluation (ACE) function 
as enumerators, crew leaders, or as field operations supervisors. 
Commerce Department employment is expected to last from six to eight 
weeks. None of these temporary Commerce employees serve in a State, 
local, or tribal government position which is filled through public 
election.
    This interim rule is being published after obtaining the 
concurrence of the Department of Justice pursuant to section 201(c) of 
Executive Order 12674. Also, as provided in section 402 of the Ethics 
in Government Act of 1978, as amended, 5 U.S.C. appendix, section 402, 
OGE has consulted with both the Department of Justice (as additionally 
required under 18 U.S.C. 208(d)(2)) and the Office of Personnel 
Management on this rule.

Matters of Regulatory Procedure

Administrative Procedure Act

    Pursuant to 5 CFR 553(b) and (d), I find that good cause exists for 
waiving the general requirements of notice of proposed rulemaking, 
opportunity for public comments, and 30-day delayed effective date for 
this interim rule. It is in the public interest that this regulation 
take effect as soon as possible in order to enable the Bureau of the 
Census to conduct the census during the year 2000 as required by 
Constitutional mandate. Interested persons are invited to submit 
written comments to OGE on this interim regulation, to be received on 
or before April 28, 2000. The Office of Government Ethics will review 
all comments received and consider any modifications to this rule which 
appear warranted before adopting the final rule on this matter.

Executive Order 12866

    In promulgating this interim rule, 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 Planning and Review. This interim rule has also been 
reviewed by the Office of Management and Budget under that Executive 
order.

[[Page 16513]]

Executive Order 12988

    As Director of the Office of Government Ethics, I have reviewed 
this interim regulation in light of section 3 of Executive Order 12988, 
Civil Justice Reform, and certify that it meets the applicable 
standards provided therein.

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 interim 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 this interim regulation does not contain information collection 
requirements that require approval of the Office of Management and 
Budget.

List of Subjects in 5 CFR Part 2640

    Conflict of interests, Government employees.

    Approved: March 17, 2000.
Stephen D. Potts,
Director, Office of Government Ethics.


    Accordingly, for the reasons set forth in the preamble, the Office 
of Government Ethics is amending 5 CFR part 2640 as follows:

PART 2640--INTERPRETATION, EXEMPTIONS AND WAIVER GUIDANCE 
CONCERNING 18 U.S.C. 208 (ACTS AFFECTING A PERSONAL FINANCIAL 
INTEREST)

    1. The authority citation for part 2640 continues to read as 
follows:

    Authority: 5 U.S.C. App. (Ethics in Government Act of 1978); 18 
U.S.C. 208; 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--Exemptions Pursuant to 18 U.S.C. 208(b)(2)

    2. Section 2640.203 is amended by adding a new paragraph (l) to 
read as follows:


Sec. 2640.203  Miscellaneous exemptions.

* * * * *
    (l) Exemption for financial interests of non-Federal government 
employers in the decennial census. An employee of the Bureau of the 
Census at the United States Department of Commerce, who is also an 
employee of a State, local, or tribal government, may participate in 
the decennial census notwithstanding the disqualifying financial 
interests of the employee's non-Federal government employer in the 
census provided that the employee:
    (1) Does not serve in a State, local, or tribal government position 
which is filled through public election;
    (2) Was hired for a temporary position under authority of 13 U.S.C. 
23; and
    (3) Is serving in a Local Census Office or an Accuracy and Coverage 
Evaluation function position as an enumerator, crew leader, or field 
operations supervisor.

[FR Doc. 00-7769 Filed 3-28-00; 8:45 am]
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