[Federal Register Volume 68, Number 172 (Friday, September 5, 2003)]
[Rules and Regulations]
[Pages 52681-52682]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-22653]



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 Rules and Regulations
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  Federal Register / Vol. 68, No. 172 / Friday, September 5, 2003 / 
Rules and Regulations  

[[Page 52681]]



NATIONAL FOUNDATION ON THE ARTS AND THE HUMANITIES

5 CFR Part 6501

RINs 3136-AA20, 3209-AA15


Supplemental Standards of Ethical Conduct for Employees of the 
National Endowment for the Arts

AGENCY: National Endowment for the Arts (NEA).

ACTION: Interim final rule, with request for comments.

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SUMMARY: The National Endowment for the Arts, with the concurrence of 
the Office of Government Ethics (OGE), is issuing regulations for 
officers and employees of the NEA that supplement the Standards of 
Ethical Conduct for Employees of the Executive Branch issued by OGE. 
The supplemental regulations require NEA employees, other than special 
Government employees, to obtain prior written approval to engage in 
certain outside employment or related activities.

DATES: These regulations take effect on September 5, 2003. Comments are 
invited and must be received on or before October 6, 2003.

ADDRESSES: Send comments to Karen Elias, Deputy General Counsel, 
National Endowment for the Arts, Room 518, 1100 Pennsylvania Avenue, 
NW., Washington, DC 20506.

FOR FURTHER INFORMATION CONTACT: Karen Elias, Deputy General Counsel, 
National Endowment for the Arts, Room 518, 1100 Pennsylvania Avenue, 
NW., Washington, DC 20506. Telephone (202) 682-5418. Individuals who 
use a telecommunications device for the deaf (TDD) may contact the 
NEA's TDD terminal at (202) 682-5496 Voice/T.T.

SUPPLEMENTARY INFORMATION:

1. Background

    On August 7, 1992, OGE published in the Federal Register new 
Standards of Ethical Conduct for Employees of the Executive Branch (the 
``Standards''), 57 FR 35006-35067. The Standards, as corrected and 
amended, are codified at 5 CFR part 2635 and generally became effective 
February 3, 1993. Those regulations 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, the NEA has determined that the following supplemental 
regulations contained in a new chapter LV, consisting of part 6501, of 
5 CFR as set forth in this interim rule are necessary to implement the 
NEA's ethics program successfully, in light of the NEA's unique 
programs and operations.
    The Foundation's old standards of conduct regulations at 45 CFR 
part 1105 were applicable to employees of both the NEA and the National 
Endowment for the Humanities (NEH) until they were superseded by the 
executive branchwide Standards at 5 CFR part 2635, and by OGE's 
executive branchwide financial disclosure regulations at 5 CFR part 
2634. In a separate rulemaking document being published in the Federal 
Register today, the Foundation's superseded old conduct regulations and 
certain redundant provisions thereof are being removed and 45 CFR part 
1105 is being revised to contain a cross-reference section referring to 
the NEA's and the NEH's new supplemental regulations (also being 
published in the Federal Register today), to 5 CFR parts 2634 and 2635, 
to 5 CFR part 2640, OGE's executive branch financial interest 
regulations, and to the executive branchwide employee responsibilities 
and conduct regulations issued by the Office of Personnel Management, 
as codified at 5 CFR part 735.

II. Analysis of the Regulations

Section 6501.101 General

    Section 6501.101 explains that the regulations contained in this 
interim rule will apply to NEA employees and are supplemental to the 
executive branchwide standards. Employees of the NEA are also subject 
to the Standards of Ethical Conduct for Employees of the Executive 
Branch at 5 CFR part 2635, the executive branch financial disclosure 
and financial interests regulations at 5 CFR parts 2634 and 2640, and 
the executive branch employees responsibilities and conduct regulations 
at 5 CFR part 735.

Section 6501.102 Prior Approval for Outside Employment

    Under 5 CFR 2635.803, an agency that determines it is necessary or 
desirable for the purposes of administering its ethics program may, by 
supplemental regulation with OGE's concurrence and co-signature, 
require its employees to obtain written approval before engaging in 
outside employment. The Foundation's superseded regulation at 45 CFR 
part 1105 required NEA employees to obtain advance approval for certain 
outside employment (that advance approval requirement remained in 
effect until February 3, 1994 by operation of the prior note following 
5 CFR 2635.803 of the Standards (see the January 1, 1997 edition of 5 
CFR)). The NEA has determined that it is necessary to the 
administration of its ethics program to reinstitute the requirement 
that employees, other than special Government employees, obtain prior 
approval before engaging in certain types of outside employment that 
pose the most potential for employees to engage in conduct that might 
violate applicable conflicts laws and regulations.
    Therefore, Sec.  6501.102(a) requires prior approval of outside 
employment when the outside employment involves a prohibited source. In 
identifying a ``prohibited source'' for purposes of this prior approval 
requirement, the NEA will apply the definition of that term found in 
the Standards at 5 CFR 2635.203(d). Thus, an employee will have to 
obtain approval before engaging in outside employment with any person 
(including an organization more than half of whose members are persons) 
seeking official action by the NEA; doing business or seeking to do 
business with the NEA; conducting activities regulated by the NEA; or 
having interests that may be substantially affected by the performance 
or

[[Page 52682]]

nonperformance of the employee's official duties. Section 6501.102(a) 
also requires written requests for approval to be submitted to the 
employee's immediate supervisor and his or her Designated Agency Ethics 
Official and specifies the information to be included in the employee's 
request. Section 6501.102(b) states the standard to be used in 
approving or denying requests for approval of outside employment. The 
basis for denial, if any, must be found in applicable statutes or 
Federal regulations, including the executive branchwide Standards.
    Section 6501.102(c) defines outside employment as including any 
form of compensated or uncompensated non-Federal employment or business 
relationship involving the provision of personal services by the 
employee. It includes writing done under arrangement with another 
person for production or publication of the written product.

III. Matters of Regulatory Procedure

Waiver of Proposed Rulemaking

    As Deputy General Counsel of the NEA, I have found good cause 
pursuant to 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, the opportunity for advance public comments, and the 30-day 
delay in effectiveness as to this interim rule. The reason for this 
determination is that this rulemaking is related to the NEA's 
organization, procedure and practice. Nonetheless, this is an interim 
rulemaking, with provision for a 30-day public comment period. The NEA 
will review all comments received during the comment period and will 
consider any modifications that appear appropriate in adopting these 
rules as final, with the concurrence and co-signature of the Office of 
Government Ethics.

Regulatory Flexibility Act

    As Deputy General Counsel of the NEA, I have determined under the 
Regulatory Flexibility Act (5 U.S.C. chapter 6) that this regulation 
will not have a significant economic impact on a substantial number of 
small entities because it only affects NEA employees.

Paperwork Reduction Act

    As Deputy General Counsel of the NEA, I have determined that the 
Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply because 
these regulations do not contain any information collection 
requirements that require the approval of the Office of Management and 
Budget.

Unfunded Mandates Reform Act

    For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 
chapter 25, subchapter II), this rule will not significantly or 
uniquely affect small governments and will not result in increased 
expenditures by State, local, and tribal governments, or by the private 
sector, of $100 million or more (as adjusted for inflation) in any one 
year.

List of Subjects in 5 CFR Part 6501

    Conflict of interests, Government employees, Standards of conduct.

    Dated: August 13, 2003.
Karen Elias,
Deputy General Counsel, National Endowment for the Arts.

    Approved: August 26, 2003.
Amy L. Comstock,
Director, Office of Government Ethics.


0
For the reasons set forth in the preamble, the National Endowment for 
the Arts with the concurrence of the Office of Government Ethics, is 
amending title 5 of the Code of Federal Regulations by adding a new 
chapter LV, consisting of part 6501, to read as follows:

CHAPTER LV--NATIONAL ENDOWMENT FOR THE ARTS

PART 6501--SUPPLEMENTAL STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES 
OF THE NATIONAL ENDOWMENT FOR THE ARTS

Sec.
6501.101 General.
6501.102 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.  6501.101  General.

    In accordance with 5 CFR 2635.105, the regulations of this part 
apply to employees of the National Endowment for the Arts (NEA) and 
supplement the Standards of Ethical Conduct for Employees of the 
Executive Branch contained in 5 CFR part 2635. In addition to the 
regulations in 5 CFR part 2635 and this part, employees of the NEA are 
subject to the executive branch employee responsibilities and conduct 
regulations at 5 CFR part 735, the executive branch financial 
disclosure regulations at 5 CFR part 2634, and the executive branch 
financial interests regulations at 5 CFR part 2640.


Sec.  6501.102  Prior approval for outside employment.

    (a) Before engaging in any outside employment with a prohibited 
source within the meaning of 5 CFR 2635.203(d), whether or not for 
compensation, an employee other than a special Government employee must 
obtain written approval from his or her immediate supervisor and the 
Designated Agency Ethics Official. The request for approval shall 
include the following:
    (1) 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 description of the employee's NEA responsibilities and the 
employee's certification that the outside employment will not depend on 
nonpublic 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 determination that the 
outside employment is not expected to involve conduct prohibited by 
statute or Federal regulation, including 5 CFR part 2635.
    (c) Outside employment means any form of compensated or 
uncompensated non-Federal employment or business relationship involving 
the provision of personal services by the employee. It includes, but is 
not limited to personal services such as an officer, director, 
employee, agent, attorney, consultant, contractor, general partner, 
trustee, teacher or speaker. It includes writing when done under an 
arrangement with another person for production or publication of the 
written product.

[FR Doc. 03-22653 Filed 9-4-03; 8:45 am]
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