[Federal Register Volume 72, Number 66 (Friday, April 6, 2007)]
[Rules and Regulations]
[Pages 16985-16987]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-6228]



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  Federal Register / Vol. 72, No. 66 / Friday, April 6, 2007 / Rules 
and Regulations  

[[Page 16985]]



OFFICE OF GOVERNMENT ETHICS

5 CFR Parts 2634, 2635, and 2636

RINs 3209-AA00, 3209-AA04 and 3209-AA13


Removal of Obsolete Regulations Concerning the Inoperative 
Provisions Regarding Charitable Payments In Lieu of Honoraria and 
Conforming Technical Amendments

AGENCY: Office of Government Ethics (OGE).

ACTION: Final rule; technical amendments and removals.

-----------------------------------------------------------------------

SUMMARY: The Office of Government Ethics is removing obsolete 
regulatory provisions in its executive branch outside earned income 
restrictions and ethical conduct standards regulations that were 
designed to implement the statutory provision regarding charitable 
payments made in lieu of honoraria, which is no longer legally 
operative. In addition, OGE is removing a related provision in the 
branchwide financial disclosure regulation regarding supplemental 
confidential reporting for such payments. Finally, OGE is making a few 
technical conforming amendments to reflect these changes.

DATES: These technical amendments and removals are effective May 7, 
2007.

ADDRESSES: Office of Government Ethics, Suite 500, 1201 New York 
Avenue, NW., Washington, DC 20005-3917, Attn.: Mr. Gressman.

FOR FURTHER INFORMATION CONTACT: William E. Gressman, Senior Associate 
General Counsel, Office of Government Ethics, telephone: 202-482-9300; 
TDD: 202-482-9293; Fax: 202-482-9237.

SUPPLEMENTARY INFORMATION: The Ethics Reform Act of 1989 (Pub. L. 101-
194) amended the Ethics in Government Act of 1978 (Ethics Act) to bar 
Government employees from accepting honoraria. See 5 U.S.C. app. 
501(b). At the same time, the 1989 Act also contained an exception to 
this prohibition which permitted employees to direct payment to 
charitable organizations in lieu of accepting honoraria. See 5 U.S.C. 
app. 501(c). However, in National Treasury Employees Union v. United 
States, 513 U.S. 454 (1995) (the NTEU case), the U.S. Supreme Court 
overturned, as to most executive branch employees, the general 
honorarium prohibition in the Ethics Act, finding it to be 
unconstitutional. Subsequently, the Department of Justice determined 
that because of the scope of the Supreme Court decision, the statutory 
ban on receipt of honoraria was inoperative as to all Government 
employees. See the OGE Memorandum to Designated Agency Ethics Officials 
(DAEOs), General Counsels and Inspectors General of February 28, 1996 
( DO-96-012); a copy of that OGE memorandum, along with the 
memorandum of the Justice Department, is available in the ``DAEOgrams'' 
section of the OGE Web site (http://www.usoge.gov).
    In the late 1990s, OGE removed the executive branch regulatory 
provisions concerning the overturned honoraria prohibition, along with 
cross-references thereto in various OGE regulations. See 62 FR 48746-
48748 (September 17, 1997), 63 FR 43067-43069 (August 12, 1998), and 
OGE's Memorandum to DAEOs of August 13, 1998 ( DO-98-023); 
copies of which are available, respectively, in the Laws & Regulations 
and DAEOgrams sections of OGE's Web site.
    Thereafter, OGE asked the Office of Legal Counsel (OLC) of the 
Justice Department whether section 501(c) of the Ethics Act remained in 
effect after the Supreme Court decision. OGE reasoned that because 
section 501(c) is basically an exception to the honoraria ban, the 
invalidation of section 501(b) should also nullify section 501(c). In 
an opinion issued March 1, 2001, OLC concluded that section 501(c) of 
the Ethics Act is no longer in effect given the NTEU case and the close 
connection between the old honorarium prohibition and the statutory 
exception for qualifying in lieu of honoraria charitable payments. See 
OGE's Memorandum to DAEOs ( DO-01-011 of March 15, 2001) 
announcing, in pertinent part, the OLC opinion and a planned OGE 
regulatory change as a result; both documents are available, 
respectively, in the ``Laws & Regulations'' and ``DAEOgrams'' sections 
of OGE's Web site (http://www.usoge.gov).
    In this rulemaking, OGE is removing from its executive branch 
regulations various provisions implementing the now-defunct exception 
in section 501(c) of the Ethics Act. First, in 5 CFR part 2636, which 
addresses limitations on outside earned income, employment and 
affiliations for certain noncareer employees, OGE is removing current 
paragraph (b)(7) of Sec.  2636.303. OGE is rescinding this paragraph, 
which cites sections 501(c) and 505 (defining certain terms) of the 
Ethics Act, because it excludes payments to charitable organizations in 
lieu of honoraria from the terms ``outside earned income'' and 
``compensation'' for purposes of part 2636. (OGE is also redesignating 
current paragraph (b)(8) of Sec.  2636.303 as new paragraph (b)(7).) 
Likewise, OGE is removing a related sentence in paragraph (c) of Sec.  
2636.303 that provides that such payments to charitable organizations 
are not received in violation of any of the limitations in subpart C of 
part 2636, since they are not outside earned income or compensation. In 
light of that change, OGE is making a conforming change to the wording 
of the following sentence of that paragraph. Moreover, OGE is removing 
current paragraph (a)(2)(i) of Sec.  2636.103, which provides that part 
2636 advisory opinions cannot be obtained regarding whether particular 
entities are qualified charitable organizations for purposes of the in 
lieu of honoraria payments regulatory provision that OGE is now 
removing from current paragraph (b)(7) of Sec.  2636.303.
    In addition, OGE is removing from 5 CFR 2635.203(f)(2) of the 
executive branch standards of ethical conduct, which defines gifts that 
are solicited or accepted indirectly, an exception for payments to 
charities in lieu of honoraria (and which contains a citation to a 
provision previously removed from the part 2636 regulation). OGE is 
also updating a citation in 5 CFR 2635.804(c)(1) to paragraph (b) of 
Sec.  2636.303 to reflect the above-noted revisions to that paragraph.
    Finally, OGE never activated for the executive branch the related 
provision of the Ethics Act on supplemental confidential reporting of 
information about payments to charitable

[[Page 16986]]

organizations in lieu of honoraria, 5 U.S.C. app., 102(a)(1)(A). In 
this rulemaking, OGE is removing the residual inactive confidential 
reporting provision currently found at paragraph (a)(2) of 5 CFR 
2634.302 of its executive branch financial disclosure regulation (and 
is consequently redesignating the other parts of paragraph (a) of that 
section), since that regulatory provision is no longer needed in light 
of these developments.

Matters of Regulatory Procedure

Administrative Procedure Act

    Pursuant to 5 U.S.C. 553(b), as Director of the Office of 
Government Ethics, I find good cause exists for waiving the general 
notice of proposed rulemaking and opportunity for public comment as to 
these final rule revisions. The notice and comment are being waived 
because these technical amendments and removals of certain provisions 
in the OGE branchwide regulations being revised concern matters of 
agency organization, practice and procedure. Furthermore, it is in the 
public interest that the obsolete provisions be removed at this time.

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 rulemaking 
will not have a significant economic impact on a substantial number of 
small entities because it primarily affects Federal executive branch 
agencies and their employees.

Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply 
because this rulemaking, involving technical amendments and removals, 
just eliminates the last regulatory vestiges (still unactivated) of a 
structure (old OMB paperwork control 3209-0004, now expired) 
which OGE had developed internally but never made effective in the 
executive branch, for supplemental confidential reporting of payments 
in lieu of honoraria to charitable organizations. The old inactive 
regulatory provisions being removed are no longer needed.

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.

Congressional Review Act

    The Office of Government Ethics has determined that this rulemaking 
is a nonmajor rule under the Congressional Review Act (5 U.S.C. chapter 
8) and will submit a report thereon to the U.S. Senate, House of 
Representatives and Government Accountability Office in accordance with 
that law when the rule is transmitted to the Office of the Federal 
Register for publication.

Executive Order 12866

    In promulgating these technical amendments to its regulations, OGE 
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. These amendments have also been 
reviewed by the Office of Management and Budget under that Executive 
order. Moreover, in accordance with section 6(a)(3)(B) of E.O. 12866, 
the preamble to these final rule revisions, which are being codified in 
revised 5 CFR parts 2634, 2635 and 2636, notes the legal basis and 
benefits of, as well as the need for, the regulatory action. There 
should be no appreciable increase in costs to OGE or the executive 
branch of the Federal Government in administering these amended 
regulations, since the revisions only remove obsolete regulatory 
provisions concerning a provision of the Ethics Act on in lieu of 
honoraria payments that is no longer in effect, along with an inactive 
regulatory provision concerning a related confidential reporting 
section of the Ethics Act. Finally, this rulemaking is not economically 
significant under the Executive order and will not interfere with 
State, local or tribal governments.

Executive Order 12988

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

List of Subjects

5 CFR Part 2634

    Certificates of divestiture, Conflict of interests, Financial 
disclosure, Government employees, Penalties, Privacy, Reporting and 
recordkeeping requirements, Trusts and trustees.

5 CFR Part 2635

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

5 CFR Part 2636

    Conflict of interests, Government employees, Penalties.

    Approved: March 26, 2007.
Robert I. Cusick,
Director, Office of Government Ethics.

0
For the reasons set forth in the preamble, the Office of Government 
Ethics is amending parts 2634, 2635 and 2636 of chapter XVI of 5 CFR as 
follows:



TITLE 5--ADMINISTRATIVE PERSONNEL

CHAPTER XVI--OFFICE OF GOVERNMENT ETHICS

PART 2634--EXECUTIVE BRANCH FINANCIAL DISCLOSURE, QUALIFIED TRUSTS, 
AND CERTIFICATES OF DIVESTITURE

0
1. The authority citation for part 2634 continues to read as follows:

    Authority: 5 U.S.C. App. (Ethics in Government Act of 1978); 26 
U.S.C. 1043; Pub. L. 101-410, 104 Stat. 890, 28 U.S.C. 2461 note 
(Federal Civil Penalties Inflation Adjustment Act of 1990), as 
amended by Sec. 31001, Pub. L. 104-134, 110 Stat. 1321 (Debt 
Collection Improvement Act of 1996); 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 C--Contents of Reports


Sec.  2634.302  [Amended]

0
2. Section 2634.302 is amended by:
0
A. Removing paragraph (a)(2);
0
B. Redesignating paragraph (a)(1) as paragraph (a); and
0
C. In redesignated paragraph (a), further designate paragraphs (i) 
through (iv) as paragraphs (a)(1) through (a)(4), respectively.

PART 2635--STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES OF THE 
EXECUTIVE BRANCH

0
3. The authority citation for part 2635 continues to read as follows:

    Authority: 5 U.S.C. 7301, 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


Sec.  2635.203  [Amended]

0
4. Section 2635.203 is amended by removing the phrase ``or for payments 
made to charitable organizations in lieu of honoraria under Sec.  
2636.204 of this chapter'' before the period at the end of paragraph 
(f)(2).

[[Page 16987]]

Subpart H--Outside Activities


Sec.  2635.804  [Amended]

0
5. Section 2635.804 is amended by removing the citation ``Sec.  
2636.303(b)(8)'' in paragraph (c)(1) and adding in its place the 
citation ``Sec.  2636.303(b)(7)''.

PART 2636--LIMITATIONS ON OUTSIDE EARNED INCOME, EMPLOYMENT AND 
AFFILIATIONS FOR CERTAIN NONCAREER EMPLOYEES

0
6. The authority citation for part 2636 continues to read as follows:

    Authority: 5 U.S.C. App. (Ethics in Government Act of 1978); 
Pub. L. 101-410, 104 Stat. 890, 28 U.S.C. 2461 note (Federal Civil 
Penalties Inflation Adjustment Act of 1990), as amended by Sec. 
31001, Pub. L. 104-134, 110 Stat. 1321 (Debt Collection Improvement 
Act of 1996); 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 A--General Provisions

0
7. Section 2636.103 is amended by revising paragraph (a)(2) to read as 
follows:


Sec.  2636.103  Advisory opinions.

    (a) * * *
    (2) An advisory opinion may not be obtained for the purpose of 
establishing whether a noncareer employee who is subject to the 
restrictions in subpart C of this part may receive compensation for 
teaching. An advisory opinion issued under this section may not be 
substituted for the advance written approval required by Sec.  2636.307 
of this part.
* * * * *

Subpart C--Outside Earned Income Limitation and Employment and 
Affiliations Restrictions Applicable to Certain Noncareer Employees

0
8. Section 2636.303 is amended by:
0
A. Adding the word ``or'' following the semicolon at the end of 
paragraph (b)(6);
0
B. Removing paragraph (b)(7);
0
C. Redesignating paragraph (b)(8) as new paragraph (b)(7); and
0
D. Removing the second sentence of the undesignated text at the end of 
paragraph (c) and revising the last sentence thereof.
    The revision reads as follows:


Sec.  2636.303  Definitions.

* * * * *
    (c) * * *
* * * * *
    * * * Also, compensation or outside earned income donated to a 
charitable organization is received by the employee.
 [FR Doc. E7-6228 Filed 4-5-07; 8:45 am]
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