[Federal Register Volume 76, Number 217 (Wednesday, November 9, 2011)]
[Rules and Regulations]
[Pages 69601-69608]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-29057]



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  Federal Register / Vol. 76, No. 217 / Wednesday, November 9, 2011 / 
Rules and Regulations  

[[Page 69601]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 731

RIN 3206-AL90


Suitability

AGENCY: U.S. Office of Personnel Management.

ACTION: Final rule.

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

SUMMARY: The U.S. Office of Personnel Management (OPM) is issuing final 
regulations to assist agencies in carrying out new requirements to 
reinvestigate individuals in public trust positions under Executive 
Order (E.O.) 13488, Granting Reciprocity on Excepted Service and 
Federal Contractor Employee Fitness and Reinvestigating Individuals in 
Positions of Public Trust, to ensure their continued employment is 
appropriate. This final regulation will implement the suitability 
reinvestigation provisions of E.O. 13488.

DATES: This rule is effective December 9, 2011.

FOR FURTHER INFORMATION CONTACT: Debra E. Buford, U.S. Office of 
Personnel Management, Employee Services, telephone (202) 606-2930, fax 
(202) 606-2613, email [email protected].

SUPPLEMENTARY INFORMATION:

Background

    On January 16, 2009, President George W. Bush signed Executive 
Order 13488. Section 5 of the order states that ``[i]ndividuals in 
positions of public trust shall be subject to reinvestigation under 
standards (including but not limited to the frequency of such 
reinvestigation) as determined by the Director of the Office of 
Personnel Management, to ensure their suitability for continuing 
employment.'' Section 2 of the order defines the terms ``Position of 
Public Trust'' and ``Suitability'' by reference to 5 CFR part 731. 
Section 6(b) delegates to OPM the ``authority to implement this order, 
including the authority to issue regulations and guidance governing 
suitability, or guidance related to fitness, as the Director determines 
appropriate.'' Finally, section 6(a) states that ``[a]n agency shall 
report to the Office of Personnel Management the nature and results of 
the background investigation and fitness determination (or later 
changes to that determination) made on an individual, to the extent 
consistent with law.''
    E.O. 13488 is distinct from, but complementary to, E.O. 13467, 
which concerns, among other things, alignment, to the extent possible, 
of investigations and standards relating to suitability or fitness, 
eligibility for logical and physical access, eligibility to hold a 
sensitive position, eligibility for access to classified information, 
and, as appropriate, contractor employee fitness.
    Public trust positions are those covered by 5 CFR part 731 that an 
agency head, under 5 CFR 731.106, has designated at a moderate or high 
risk level, based on the position's potential for adverse impact on the 
efficiency or integrity of the service. These positions may involve 
policy-making, major program responsibility, public safety and health, 
law enforcement duties, fiduciary responsibilities, or other duties 
demanding a significant degree of public trust, or access to or 
operation or control of financial records, with a significant risk for 
causing damage or realizing personal gain. Agencies designate public 
trust positions, and their risk levels, following OPM guidance and 
taking into account the specific duties of each position.
    On November 3, 2009, OPM published, in the Federal Register at 74 
FR 56747, a proposed rule to guide agencies in carrying out the new 
requirement to reinvestigate individuals in public trust positions 
under E.O. 13488. The public comment period ended on January 4, 2010. 
Several Federal Agency commenters indicated they were unable to provide 
an informed recommendation related to the frequency of reinvestigations 
without specific information regarding the scope of the 
reinvestigations. Thus, on November 5, 2010, OPM published a notice in 
the Federal Register at 75 FR 68222 reopening the comment period on the 
proposed rule. This notice provided additional information about the 
scope of reinvestigations for public trust positions to allow for 
further comment about reinvestigation frequency. In addition, OPM 
proposed revising the text of the proposed rule at 5 CFR 731.106(d)(2), 
to resolve an ambiguity regarding investigations that satisfy the 
public trust reinvestigation requirement, and solicited additional 
public comment on the revised text. The comment period on this second 
Federal Register notice ended on December 6, 2010.

Response to Public Comments

    In response to the original proposed rule and the reopener, OPM 
received comments from 8 agencies, 4 unions, and 5 individuals. OPM 
carefully considered comments received in response to the November 3, 
2009, and November 5, 2010, Federal Register notices in the development 
of this final rule. The comments fell into one of the following 
categories: frequency of reinvestigations; impact on resources; timing 
of implementation of the reinvestigation cycle; reinvestigation 
requirements; alignment of reinvestigation standards; confusion 
regarding the term ``assessment''; insufficiency of the information 
provided; breaks in service of less than 24 months; collective 
bargaining and labor relations; and miscellaneous. We have not 
addressed the remaining comments either because they concerned other 
suitability subparts not being revised or did not relate to suitability 
at all.

Frequency of Reinvestigations

    Many commenters voiced concerns about the frequency of public trust 
reinvestigations. One labor organization representative said OPM should 
withdraw the proposed rule and reissue it after providing the rationale 
for the reinvestigation, the number of Federal employees affected, the 
reinvestigation criteria, and a cost estimate for performing such 
investigations. Another labor organization commented that OPM should 
reconsider the need for periodic reinvestigations in the first place 
and, upon reexamination, recommend to the Administration that the 
Executive Order be rescinded. Other commenters stated that OPM should 
not issue a reinvestigation cycle requirement

[[Page 69602]]

without first analyzing the actual need for, and effectiveness of, 
these investigations, their overall costs to the Government, and 
whether research exists that suggests 5 years is the most appropriate 
timeframe. A commenter recommended that reinvestigations be conducted 
every 10 or 15 years, and opined that it does not appear appropriate to 
require the same reinvestigation timeframes for public trust positions 
as for national security positions, considering the potential for harm 
to the United States. Another commenter recommended a frequency of 10 
years, as OPM has not provided data to demonstrate that a more frequent 
reinvestigation cycle for public trust positions than for national 
security positions promotes the efficiency of the service. One 
commenter suggested the frequency be every 7 years as a cost-saving 
measure. Still another commenter recommended agencies be given 
additional flexibility so periodic background checks can be extended 
beyond a 5-year time limit or agencies be granted the flexibility to 
identify, based on their needs and knowledge of the positions, which 
ones require reinvestigations every 5 years, rather than imposing a 
blanket requirement for all positions. During the first comment period, 
one commenter stated that those positions that truly warrant periodic 
reinvestigations, such as supervisory and auditor positions, should be 
reinvestigated no more frequently than once every 5 years. However, 
during the second comment period, this same commenter stated those 
positions should be subject to periodic reinvestigations without 
mentioning a specific timeframe. A labor organization representative 
stated that, in making certain assumptions about the scope of the 
investigation, a frequency of every 10 years is sufficient. On the 
other hand, two commenters suggested that the time period for 
reinvestigations be lowered from 5 years to a frequency of every 2 or 3 
years. Lastly, two commenters stated the policy change is appropriate 
considering the risk posed by public trust positions in their agency.
    OPM did not adopt any of these recommendations. This rule is 
intended to satisfy E.O. 13488, which requires reinvestigations of 
public trust positions with a frequency as determined by the Director 
of the Office of Personnel Management. As described in the reopener, 
the investigative product for reinvestigations of employees occupying 
nonsensitive public trust positions will be the National Agency Check 
with Local Agency Check and Credit Check (NACLC) or Periodic 
Reinvestigation (PRI) depending on the level of public trust. As 
proposed, reinvestigations must occur frequently enough to ensure that 
continued employment of persons in public trust positions remains 
appropriate. The E.O. requires a meaningful determination of continuing 
suitability for employment. To be meaningful, a determination cannot 
reasonably be made with outdated information. Accordingly, we have 
decided to retain the 5-year reinvestigation requirement.
    OPM chose the 5-year timeframe because it is consistent with the 
coverage period that has long been established as the minimum coverage 
period for suitability investigations. The National Agency Check with 
Written Inquiries (NACI) is the minimum required level of initial 
investigation and is required for low-risk positions. The coverage 
period for the NACI is 5 years and has historically been 5 years. 
Considering that a public trust position's potential adverse impact on 
the efficiency or integrity of the service is greater than that of low-
risk positions, we believe 5 years is a reasonable timeframe for public 
trust reinvestigations. Further, if the scope of coverage for the 
original suitability investigation is 5 years, it follows that the 
reinvestigations should be completed within the same timeframe, at a 
minimum. Therefore, a less-frequent timeframe for reinvestigations has 
not been adopted.
    E.O. 13467 requires OPM to consider efficiency and cost 
effectiveness in setting reinvestigative requirements as well. 
Regarding comments about the number of employees impacted and the costs 
associated with reinvestigations, we recognize that the number of 
employees who may be affected has a direct correlation to the cost of 
reinvestigations. However, it is difficult to arrive at an accurate 
number affected because of the evolving needs of agencies. Historical 
costs are, therefore, poor indicators of future costs. Agencies are 
responsible for assessing the position designations within their 
agencies and will know the number of employees to be reinvestigated and 
may, therefore, predict the cost based on the price of the required 
investigation. However, while we cannot allow too much time to go by 
between reinvestigations, we recognize the need to balance risk and 
cost. Therefore, we have chosen relatively low-cost investigative 
products, the NACLC and the PRI, to minimize the cost. As described 
below, we have also sought to reduce cost by aligning public trust and 
national security reinvestigation requirements. In addition, OPM 
commits to periodically assess the cost-effectiveness of the 
investigative products selected.
    Commenters suggested that the frequency of public trust 
reinvestigations should be aligned with those required for clearance 
holders. We recognize the need for alignment to the extent possible. 
Therefore, in section 731.106(d)(2) of the final rule, as in the 
proposed rule, a reinvestigation for eligibility for access to 
classified information or to occupy a sensitive national security 
position may be sufficient to meet the requirements for a public trust 
reinvestigation. Likewise, in our proposed rule amending 5 CFR part 
732, dated December 14, 2010, Designation of National Security 
Positions, the timeframe for reinvestigations is also set at 5 years 
for national security positions not requiring eligibility for access to 
classified information. We expect to publish the revised part 732 
regulations in early 2012. In tandem, these provisions in parts 731 and 
732 will ensure that one reinvestigation at least every 5 years will be 
sufficient to meet national security and public trust requirements, so 
that agencies will not have to bear the burden and expense of 
requesting multiple reinvestigations to meet separate requirements. A 
reinvestigation on a Special Sensitive or Critical Sensitive national 
security position will be sufficient to meet, the reinvestigation need 
of a High Risk public trust position. A reinvestigation on a Non-
Critical Sensitive national security position will be sufficient to 
meet the reinvestigation need of a Moderate Risk public trust position.
    A commenter suggested a 15-year timeframe is an appropriate 
frequency for reinvestigations for low-risk positions that are 
investigated with the National Agency Check with Inquiry Investigations 
(NACI's). However, this rule does not cover low-risk positions. It 
fulfills the requirements of E.O. 13488, which mandates that 
individuals who are in public trust positions, defined by 5 CFR part 
731 as those designated as moderate and high risk, be reinvestigated. 
There is no government-wide requirement to conduct reinvestigations of 
employees in low-risk, nonsensitive positions.
    During the initial comment period, a commenter suggested that OPM 
consider allowing additional flexibility following the first 5-year 
reinvestigation. The commenter suggested widening the window for 
subsequent reinvestigations to every 5-10 years at the discretion of 
the agency, depending on the nature of the position and its public 
trust level. During the

[[Page 69603]]

second comment period, the same commenter suggested agencies be given 
discretion to stretch the reinvestigation period to 10 years. We did 
not adopt these recommendations. E.O. 13488 requires reinvestigations 
of individuals in public trust positions with a frequency determined by 
the Director of OPM, not by individual agencies. OPM has decided to 
require all agencies to follow the same reinvestigation schedule to 
promote consistency across the Federal Government. Further, 5 CFR 
731.104 and 731.202 require reciprocal acceptance of prior suitability 
investigations and adjudications. A consistent reinvestigation cycle 
will promote reciprocity by giving gaining agencies confidence that 
they are accepting prior investigations and adjudications that were 
recent enough to have identified any serious issues that would have 
affected eligibility for continued employment.
    A labor organization representative stated that longer intervals 
are needed between reinvestigations because it is a stressful and time-
consuming process for the typical employee. However, reinvestigations 
must occur frequently enough if agencies are to carry out the purpose 
of Executive Order 13488 to ensure that continued employment of persons 
in public trust positions remains appropriate.
    A commenter stated that clarification may be needed to ensure 
agencies understand the reinvestigation requirement is based on the 
completion date of the prior investigation. We agree and will provide 
clarification in the implementing guidance.

Impact on Resources

    Many commenters made observations regarding the impact of 
reinvestigations on time, personnel, and financial resources. A 
commenter stated that large agencies with a high number of public trust 
positions would incur a heavy economic impact, while another commenter 
voiced concerns regarding the strain on personnel resources when taking 
on the additional reinvestigation requirements, since most employees in 
moderate-risk positions have not been reinvestigated. A commenter also 
voiced concern about OPM's Federal Investigative Services having the 
capacity to perform reinvestigations in a timely manner, while another 
commenter stated OPM will have major increases in costs and workload. 
Further, a labor organization representative commented that, since OPM 
does not know how many Federal employees will be subject to the 
regulation, no analysis of the program's cost has been provided. A 
labor organization representative further stated that, before the 
regulation can be properly evaluated, the costs must be examined. 
Another labor organization representative stated that OPM should 
postpone issuing the regulation until the number of employees affected 
by this regulation and the scope of the investigations that will be 
conducted are known. However, agencies also commented that such 
reinvestigations are necessary, and one commenter felt it was 
irrelevant to consider future investigation and resource capacities in 
the implementation of suitability policies and procedures.
    OPM has not made changes to the rule as a result of these comments. 
While we agree that reinvestigations will take time and resources to 
accomplish, they are essential investments to ensure that continued 
employment of employees is appropriate. OPM's responses to comments 
about the cost and resource implications of the frequency of 
reinvestigations, the population affected, and the reinvestigation 
products selected, are addressed in greater detail above. OPM provides 
investigative services on a reimbursable basis, pursuant to a revolving 
fund established by Congress for this purpose, and is thus in a 
position to readily ensure that sufficient investigative resources are 
dedicated to meet the requirements of this rule.
    During the first comment period, a commenter questioned whether the 
proposed regulation will allow effective and efficient use of time and 
resources if the regulations do not establish substantive regulatory 
standards for adjudicating public trust reinvestigations, and if 
agencies are unable to use suitability actions as the result of a 
reinvestigation. During the reopener, the commenter again voiced 
concerns that the proposed regulation does not meet the test of 
effectiveness and efficiency regarding the use of time and resources. 
The regulation is intended to satisfy E.O. 13488 which requires 
reinvestigations of public trust positions.
    Because the Executive order requires a reinvestigation of 
``suitability for continuing employment'' and defines ``suitability'' 
by reference to 5 CFR part 731, agencies should consider the 
substantive standards in Sec.  731. 202, when evaluating the results of 
a public trust reinvestigation. However, a person's employment status 
will determine the applicable agency authority and procedures to be 
followed in any action taken based on the results of the 
reinvestigation. In most situations the subject of a reinvestigation 
will have been employed by his or her agency for more than 1 year 
following an appointment subject to investigation, and, in that 
context, only OPM could take a suitability action under 5 CFR part 731 
and only under the limited circumstances described in Sec.  731.105(d). 
Nonetheless, conduct that surfaces during a reinvestigation could form 
the basis for an adverse action under 5 CFR part 752. Whether to 
propose and take an adverse action on the basis of a public trust 
reinvestigation is a matter within the employing agency's discretion.
    A commenter expressed concern that, given finite resources, 
security clearance cases are given first priority to ensure they meet 
the requirements of the law (i.e., the timeliness requirements for 
security clearance adjudications in 50 U.S.C. 435b(g)). Further, the 
commenter stated that, with the implementation of the reinvestigation 
cycle for public trust positions, the timeliness of determinations 
based on public trust reinvestigations will only diminish unless 
Congress or the President requires them to be made within a specified 
timeframe. These comments did not make any specific recommendation as 
to the text of the rule. Accordingly, we did not make changes to the 
rule as a result of these comments. We note that E.O. 13488 requires 
individuals to be investigated with a frequency determined by the 
Director of OPM to ensure suitability for continued employment; and 
that to help achieve this objective the order requires agencies to 
report the results of background investigations to OPM. Section 731.206 
of the final rule implements this reporting requirement, so that OPM 
can assess the timeliness of agency decisions. This regulation 
complements the reporting requirements in part 732 for national 
security investigations and adjudications, which also facilitate 
monitoring.
    One commenter noted that the same resources used to meet new 
reinvestigation requirements are also used to make initial 
determinations for suitability and security for new hires. This 
commenter expressed concern about having sufficient resources to meet 
these requirements and suggested that the requirements will have an 
adverse impact on agencies' ability to meet the goals of OPM's Hiring 
Reform Initiative. As noted above, the re-investigation requirement was 
imposed by a 2009 Executive Order that requires reinvestigation of 
public trust positions. Therefore, we do not agree with this 
commenter's assessment of the impact on hiring reform. The hiring 
reform initiative is a comprehensive and

[[Page 69604]]

integrated approach to Federal hiring that addresses workforce 
planning, recruitment, hiring process, security and suitability, and 
orientation. Moreover, this initiative assumes there are ongoing reform 
efforts to align investigative and adjudicative processes and also 
addresses various challenges throughout the hiring process, including 
limited resources. Agencies have known about the reinvestigation 
requirement for some time, now, and can be presumed to have anticipated 
its implementation.
    A commenter inquired as to whether or not the proposed rule would 
create other changes to the investigation structure, the overall 
investigation process, or the types of investigations available that 
will ultimately impact agencies' workload. The final rule will not 
affect the structure of investigations, the process, or the types of 
investigation. However, OPM is assessing its investigative products as 
part of a Joint Security and Suitability Process Reform effort under 
E.O. 13467. Future Federal investigative standards resulting from this 
effort will use automated records to the extent possible and may impact 
the investigative structure and process. Other impacts on the 
investigative process may result from our proposed rule in 5 CFR part 
732, dated December 14, 2010, Designation of National Security 
Positions, which prescribes time frames for national security 
reinvestigations.

Timing of the Implementation of Reinvestigation Cycle

    One commenter indicated the regulation lacks clarity as to when the 
5-year investigation period will begin following the rule's 
implementation, while other commenters suggested agencies be given 
flexibility to implement the reinvestigation cycle. OPM concurs and has 
added language to the rule stating that implementing guidance will be 
issued regarding time lines for implementing this regulation. Agencies 
will be afforded flexibility within the parameters set in that 
guidance.
    One commenter suggested that the reinvestigation cycle be delayed 
until the new SF-85P, Questionnaire for Public Trust Positions, is 
published for agency use. This comment is beyond the scope of this 
regulation. This regulation is intended to satisfy E.O. 13488, which 
requires reinvestigations of public trust positions.
    A commenter suggested delaying implementation of the 
reinvestigation cycle until OPM implements the tiered investigative 
model described in section 2.1(a) of E.O. 13467, where each 
successively higher level of investigation shall build upon, but not 
duplicate, the ones below it. We did not adopt this recommendation. 
Although OPM is working on the investigative standards contemplated by 
E.O. 13467, we do not believe the possibility of future changes to 
investigative products should affect the need to timely implement E.O. 
13488. OPM has added language to this regulation at Sec.  731.106(d)(1) 
stating that implementing guidance will be issued.
    A labor organization representative expressed concern that this 
regulation will take effect without any prior notice to current Federal 
employees that informs them they may be subject to reinvestigations. 
This labor union representative also recommended that current employees 
be grandfathered under the old rules and the new rules apply only to 
future employees. This recommendation is not adopted as it does not 
satisfy the requirements of E.O. 13488, to conduct reinvestigations for 
all public trust positions. However, we do recognize the commenter's 
concern and have made revisions to the regulation at Sec.  
731.106(d)(3), requiring agencies to notify all current employees 
impacted by this rule of these new reinvestigation requirements.
    The labor organization representative further commented that 
reinvestigations could result in employees being jeopardized for 
previously undisclosed past misconduct. OPM does not regard this as an 
effective argument against a reinvestigation requirement for public 
trust positions. Rather, the possibility that an employee may not 
always disclose past misconduct to the employing agency provides a 
sound reason for conducting such reinvestigations.

Reinvestigation Requirements

    One commenter stated that the proposed language confuses 
reinvestigation requirements for national security positions with new 
reinvestigation requirements for public trust positions mandated by 
E.O. 13488. We disagree and did not make a change as a result of this 
comment. Rather, the separate authorities for reinvestigations for 
national security positions and public trust positions are outlined to 
ensure agencies avoid duplicate investigations where an existing 
investigation already satisfies the requirement.
    In the Notice of Proposed Rulemaking dated November 3, 2009, the 
proposed language in Sec.  731.106(d)(2) states: ``If, prior to the 
next required reinvestigation, a separate investigation (or 
reevaluation) is conducted to determine a person's eligibility (or 
continued eligibility) for access to classified information or as a 
result of a change in risk level as provided in Sec.  731.106(e), and 
that investigation is conducted at an equal or higher level than is 
required for a public trust reinvestigation, a new reinvestigation is 
not required. * * *'' A commenter stated that the meaning of ``at an 
equal or higher level'' in Sec.  731.106(d)(2) is unclear. We have 
reworded this paragraph to clarify that a new investigation is not 
needed if the previous investigation ``meets or exceeds'' the criteria 
required for a public trust reinvestigation.
    A labor organization representative stated that it welcomed an 
indication that OPM intends the scope of reinvestigation for moderate-
risk positions to be generally less intrusive and narrower in scope 
than the reinvestigation of employees in high-risk positions. It should 
be noted that the scope of the reinvestigation may be changed to meet 
needs such as a further assessment of character or conduct because of 
new information. A commenter suggested the use of automated 
reinvestigative database checks without a new investigative 
questionnaire. This suggestion is not feasible because the 
effectiveness of reinvestigations relies on updated information 
provided by the individual. However, OPM is considering the use of 
automated reinvestigative database checks in addition to a new 
investigative questionnaire.
    One commenter recommended that 5 CFR part 731 be revised to provide 
general authority to take suitability actions, not only for limited 
situations currently described in part 731. The commenter believed this 
change would allow the suitability decision to remain with agency 
officials responsible for security, enhance consistency, and aid 
reciprocity. Another commenter recommended that OPM revise the 
regulations to allow agencies to take suitability actions whenever a 
new suitability investigation is conducted rather than limiting agency 
suitability actions to 1 year from the date an individual enters on 
duty. We did not accept these recommendations as they are beyond the 
scope of the proposed rule. Further, agencies' authority to take 
suitability actions is delegated by OPM under 5 U.S.C. 1104(a)(2), and 
cannot exceed the authority that OPM itself possesses. By regulation, 
OPM's own jurisdiction to take a suitability action against employees 
who have completed the first year of appointments subject to 
investigation is limited to those cases where the employee has 
committed falsification, deception or fraud in an

[[Page 69605]]

examination or appointment; is disqualified under a statutory or 
regulatory bar to appointment; or has refused to testify when required 
to do so by Civil Service Rule V. See 5 CFR 731.103(g), 731.105(d). OPM 
does not interpret its suitability jurisdiction more broadly. Further, 
OPM declines to delegate to agencies the authority to take suitability 
actions against employees in these circumstances, because they are at 
the core of OPM's responsibility to protect the integrity of the 
competitive examining system and to impose government-wide debarments 
when appropriate. Moreover these are circumstances where there may be a 
conflict between OPM's and the agencies' interests, as recognized by 5 
CFR 731.303(b).
    One commenter stated that agencies should be delegated the 
authority to initiate subsequent reinvestigations based on changes in 
the position requirements and/or findings of misconduct. Another 
commenter asked why OPM doesn't issue a regulation moving this entire 
process to a ``risk-based'' process--i.e., requiring agencies to focus 
on the actual employees in public trust positions instead of requiring 
basically all employees to complete this periodic reinvestigation. A 
third commenter noted that OPM should issue implementing guidance allow 
public trust reinvestigations to be event-driven to resolve any new 
potentially adverse information. As previously stated, E.O. 13488 
requires reinvestigations of all employees in public trust positions. 
If position requirements change, an agency should use OPM's Position 
Designation System to determine any new investigation requirement and 
subsequent reinvestigation requirements. As for event-driven situations 
or misconduct, another reinvestigation may or may not be appropriate. 
When the agency becomes aware of misconduct, it should take appropriate 
action. This may include fact-finding inquiries and an adverse action 
under 5 CFR part 752, if appropriate.
    A commenter asked whether employees who have been employed for a 
long period of time will be subject to a less rigorous reinvestigation. 
Employees will not be subject to less rigorous reinvestigations simply 
because of their length of service. All public trust employees will be 
required to undergo reinvestigations at the level commensurate with 
their position designations.
    A commenter stated that the agency conducting the reinvestigation 
does not appear to have authority under the proposed rule to take any 
negative action based upon a negative ``assessment''. Another commenter 
asked what standards will be used to assess an employee's fitness after 
a reinvestigation. As noted above, since the Executive order requires a 
reinvestigation of ``suitability for continuing employment'' and 
defines ``suitability'' by reference to 5 CFR part 731, agencies should 
consider the substantive standards in Sec.  731. 202, when evaluating 
the results of a public trust reinvestigation. As currently provided at 
5 CFR 731.106(f), a person's employment status will determine the 
applicable agency authority and procedures to be followed in any action 
taken based on the results of the reinvestigation. If the character or 
conduct of an employee undermines the efficiency of the service, the 
agency may take an adverse action under 5 CFR part 752, if warranted. 
In addition, to provide further clarification as to the types of 
actions that can be taken against categories of probationary employees, 
we have modified the language in Sec.  731.106(f) to include a 
reference to 5 CFR part 315 for appointees or 5 CFR part 359 for SES 
probationers.
    A labor organization representative commented that the lack of a 
substantive need for a reinvestigation is illustrated by the narrow 
nature of the suitability action that could result from the 
reinvestigation. The labor organization representative further stated 
that there are better, less intrusive and more targeted ways to uncover 
and correct an employee's misconduct other than the ``broad brush'' of 
a reinvestigation. Another labor organization questioned the need to do 
reinvestigations when only a few investigations will uncover areas of 
concerns and most issues could not lead to disciplinary actions. We did 
not make changes to the rule as a result of these comments, which 
question the need for the Executive order rather than requesting a 
change to the proposed rule implementing the order.
    A labor organization representative called on OPM to recommend to 
the Administration that it reexamine the need for reinvestigations for 
public trust positions. This comment is outside the scope of the 
rulemaking, so it cannot be considered by OPM as part of the rulemaking 
process.
    A commenter stated that the rule should include a requirement that, 
prior to performing a reinvestigation, the employing agency must review 
and determine that the employee's position has been properly designated 
as to risk level. We did not adopt this recommendation, as agencies 
must use OPM's Position Designation System, and should re-designate 
positions as appropriate, such as when duties of the position change. 
OPM will not impose a requirement to review the position designation 
solely due to a pending reinvestigation. We note that our proposed 
amendment to 5 CFR 732.204 would require agencies to reassess the 
sensitivity designation of each national security position within a 24-
month period. Proposed section 732.201(c) states that OPM will issue 
guidance under which an appropriate risk designation will automatically 
follow from the position's sensitivity designation. Agencies are free 
to reassess the risk designations of their nonsensitive public trust 
positions at the same time.
    One commenter stated that it has a Continuous Evaluation Program 
(CEP) in place to identify, investigate, and adjudicate many of the 
same issues a public trust reinvestigation process would address. 
Further, the commenter suggested that focusing efforts on agency CEPs 
would reduce the need for more frequent reinvestigation cycles. Another 
commenter questioned whether or not there is redundancy between the 
reinvestigation and the FD-961 (Bioterrorism Preparedness Act: Entity/
Individual Information) form. An investigation based on a CEP or the 
FD-961 that meets all requirements for reinvestigation or goes beyond 
those requirements may be sufficient. However, the commenters have not 
provided enough information about the content of the CEP or an FD-961 
investigation; therefore, we are not able to determine if these 
investigations will satisfy the intended investigative requirement for 
public trust reinvestigations. These recommendations are not adopted 
because we do not have enough information to evaluate them.
    A commenter recommended aligning fingerprinting requirements for 
periodic reinvestigations on public trust positions with those of 
reinvestigations for national security positions; and indicated that no 
fingerprinting is required in most periodic reinvestigations. Criminal 
checks will remain a critical component of reinvestigations, but 
whether or not fingerprinting for criminal checks will be required will 
be addressed in implementing guidance.
    One commenter stated that it is using the National Agency Check 
with Inquiries (NACI) investigation in lieu of the Modified Background 
Investigation or Limited Background Investigation for moderate-risk 
public trust positions where the incumbent has no access to

[[Page 69606]]

national security classified information. The NACI is not an 
appropriate level of investigation for Public Trust positions. OPM 
issued an October 2010 instruction to executive branch agencies 
regarding the appropriate investigations for moderate-risk public trust 
positions. The NACLC will be the reinvestigation required for moderate-
risk public trust positions because it efficiently provides high-value 
information necessary to evaluate a person's continued suitability for 
a moderate-risk position. Future Federal investigative standards may 
redefine investigation and reinvestigation standards for public trust 
positions.
    One commenter recommended OPM grant exemptions for reinvestigations 
on Minimum Background Investigations and revise the regulations to 
clarify or expand definitions of representative public trust position 
duties in 5 CFR 731.106. This recommendation is not adopted because the 
Executive order does not authorize OPM to grant exemptions from 
reinvestigation requirements, and because the definitions of 
representative public trust position duties are not within the scope of 
this rulemaking.

Alignment of Reinvestigation Standards

    A commenter voiced a concern that OPM may propose that 
reinvestigations for moderate and high-risk positions be different from 
the continuous evaluation requirements (at the same tier level) 
approved in Federal Investigative Standards that were issued in 
December 2008, but never implemented. OPM declines to modify the rule 
to reference or align with standards that were not implemented. 
However, as previously noted, we recognize the need for alignment of 
reinvestigation requirements to the extent possible, and this alignment 
is reflected both in Sec.  731.106(d)(2) of this final rule, and in 
proposed 5 CFR 732.203. Also as previously noted, new investigative 
standards are under development. The new investigative standards are 
targeted to be implemented in 2013.
    Another commenter stated it is unclear why OPM is deferring 
establishing new investigative standards for public trust 
investigations until a later issuance, as this means that the rule 
offers little guidance on anything other than the frequency of 
reinvestigations. The commenter also stated that the rule cannot be 
implemented until guidance on the investigative standards is published. 
The purpose of this rulemaking is to prescribe the frequency of public 
trust reinvestigations. In the reopener, we also explained the 
investigative products we intend to use for public trust 
reinvestigations for non-sensitive positions: The NACLC and the PRI. 
Scope and coverage standards have already been established for these 
products. Investigations and adjudications have been proceeding 
throughout the period that OPM and other agencies have been working on 
alignment issues, and will continue to proceed after implementation of 
these regulations. OPM therefore disagrees with the commenter's 
assertion that introducing changes to the suitability rule that are 
required by Executive Order is somehow inappropriate or that there is 
insufficient guidance to implement the rule. Further, as alignment 
efforts move forward, new investigative standards and products will be 
developed, but it is neither necessary nor desirable to codify the 
scope and coverage standards for investigative products in permanent 
rules.

Confusion Regarding the Term ``Assessment''

    Some commenters stated that the term ``assessment'' caused 
confusion. One commenter suggested we use the term ``decision'' 
instead, as ``assessment'' implies observation and evaluation. Another 
commenter stated that OPM did not adequately explain why it is 
proposing to replace ``determination'' with ``assessment.'' The 
commenter recommended that the language remain as it is in the current 
rule and include new language that states what action must be taken as 
a result of a reinvestigation. A commenter recommended we change the 
term ``assessment'' back to ``determination,'' as this commenter 
believed that any final decision regarding an individual's continued 
suitability for Federal employment based upon a completed investigation 
should be called a ``determination'' for consistency across agencies. 
Another commenter recommended that OPM outline what happens after a 
completed suitability investigation (``determination'') and what 
happens after a completed reinvestigation (``assessment''). The 
commenter also stated that the term ``assessment'' needs to be further 
defined or explained. Only one commenter indicated that the term 
``assessment'' clarified the process.
    Since use of the term ``assessment'' has not provided clarification 
as intended, in Sec.  731.106(d)(1) we have changed the term back to 
``determination,'' to reflect the decision-making process associated 
with ensuring suitability for continuing employment. In the context of 
this rule, the ``determination'' is a decision as to whether or not to 
take a suitability action, adverse action, or probationary action, or 
to refer a case to OPM for adjudication, as appropriate. An adverse 
action, if taken, must meet statutory procedural requirements. E.O. 
13488 does not require an agency to take an adverse action when it 
otherwise would not be warranted.
    To provide further clarification as to the types of actions that 
can be taken against categories of employees, we have modified the 
language in Sec.  731.106(f) to include a reference to 5 CFR part 315 
for probationers or 5 CFR part 359 for Senior Executive Service (SES) 
probationers. We have also changed Sec.  731.106(e) to include 
appointees as well as employees, as changes in risk levels can occur 
with respect to both.

Insufficient Information

    Some labor organization representatives expressed concerns that 
sufficient information was not provided to enable them to comment in a 
meaningful fashion regarding the frequency of reinvestigation. We 
disagree. This rule was originally proposed on November 3, 2009, and 
reopened on November 5, 2010, to specifically solicit comments on the 
reinvestigation cycle. The new notice provided adequate information 
about the intended reinvestigation products. Despite continuing 
concerns expressed on lack of information, a number of substantive 
comments were still provided by these parties regarding frequency of 
reinvestigation.

Breaks in Service That Are Less Than 24 Months

    Some commenters observed that the proposed rule does not contain 
language addressing how breaks in service affect investigative 
requirements. As a result, they recommended that OPM amend the proposed 
rule to clarify that a break in service of less than 24 months would 
not require a new investigation. They argued that this would support 
the goals of reciprocity and alignment between suitability and national 
security investigations. OPM agrees and has revised Sec.  731.104(a) to 
clarify that a new investigation is not required when there has been a 
break in service of less than 24 months.

Collective Bargaining and Labor Relations

    One agency commenter and a labor organization representative 
expressed the opinion that implementation of these regulations may 
require collective bargaining for employees in bargaining

[[Page 69607]]

units prior to implementation. The commenters made no specific 
recommendations, so no changes were made to the rule.
    A labor organization representative commented that implementation 
of these regulations will have a negative impact on labor relations and 
Federal employees and recommends that the National Council on Federal 
Labor-Management Relations review the rule and make recommendations to 
the President on whether to proceed with the rule. This labor 
organization representative also proposed that OPM hold the rule in 
abeyance until the President decides whether or not to proceed with it. 
The labor organization representative did not provide any additional 
information regarding the perceived negative impact on labor relations 
and Federal employees. We did not adopt these recommendations. The 
rulemaking is required by E.O. 13488. As long as the E.O. remains in 
place, there is no basis for OPM to submit this rule for the National 
Council's review or to hold it in abeyance. The proposed rule dated 
November 3, 2009, and the reopener dated November 5, 2010, were 
provided to all unions with Governmentwide consultation rights with OPM 
for their comments and recommendations regarding the rule. 
Additionally, agencies, members of the public, and other labor 
organizations were also provided an opportunity to comment on the 
proposed rule.

Miscellaneous Comments

    One commenter stated that a review should be made as to whether 
agencies will initiate adverse action proceedings should off-duty 
criminal conduct be discovered, when the conduct does not have a nexus 
to the service. OPM did not adopt this recommendation as it is outside 
the scope of this rule. However, as stated earlier, 5 CFR 731.106(f) 
currently provides that a person's employment status will determine the 
applicable agency authority and procedures to be followed in any action 
taken based on the results of the reinvestigation. This rule prescribes 
reinvestigation requirements, and cannot be read to amend the statutory 
standard for bringing an adverse action under 5 U.S.C. chapter 75. 
Under this standard an adverse action must have a nexus with the 
efficiency of the service.
    One commenter stated that OPM's separate proposal to amend part 732 
will, if adopted, have the effect of broadening the categories of 
position duties that are categorized as ``sensitive'' and, as a result, 
OPM should not make references in part 731 to the representative 
position duties of ``public trust'' positions. The definition of 
representative ``public trust'' position duties in 5 CFR 731.106(b) is 
not within the text that OPM proposed to amend in the rule, so the 
comment is outside the scope of the rulemaking. Nonetheless, we note 
that the commenter appears to assume that national security positions 
do not also have a public trust risk designation. This assumption is 
incorrect under Sec.  731.106(b)(2). We also note that the commenter's 
statement about the possible effect of OPM's proposal to amend part 732 
is speculative. As we noted in the Supplementary Information 
accompanying the notice of proposed rulemaking, the proposed rule 
contains text intended to address the risk of over-designating national 
security positions as well as the risk of under-designating such 
positions.
    One commenter stated that directing agencies to make an 
``assessment'' of whether findings of an investigation would justify an 
action against an employee will take the decision out of the personnel 
security arena and place it into the employee and labor relations 
arena. While we have agreed to retain the term ``determination'' 
instead of ``assessment,'' there is no intended change in how these 
actions are handled in an agency. OPM is aware that some agencies 
conduct suitability reviews as a human resources function, while other 
agencies conduct such reviews as a security function. It is not OPM's 
intent in this rulemaking to prescribe which internal component of an 
agency will conduct a function.
    One commenter stated that, given the reporting requirement, the 
agency will have to complete the INV Form 79A, Report of Adjudicative 
Action on OPM Personnel Investigations. The agency further stated that 
this requirement will place the burden on personnel security divisions 
to report on actions that may be taken by other offices. While agencies 
have responsibilities to comply with this rule, it is up to each agency 
to determine how it will do so.
    One commenter questioned why OPM doesn't issue a regulation 
regarding how employees can dispute the designation of their positions 
as public trust positions. This question is beyond the scope of the 
proposed rule, which is limited to the frequency of reinvestigations. 
However, because the position designation process is a discretionary 
agency decision, employees should consult with their agency human 
resources office regarding whether any administrative procedures are 
available to employees if they wish to dispute whether rules and 
regulations have been properly applied.
    One commenter questioned how designations of public trust positions 
are made, and recommended that OPM clarify the definition of public 
trust position duties in its regulation. Designations of public trust 
positions and their risk levels are made by agencies following OPM 
guidance and taking into account the specific duties of each position. 
The comment that OPM should clarify the definition of public trust 
position duties in the rule cannot be considered because it addresses 
matters outside the scope of the rulemaking.
    Finally, OPM is updating the authority citation for part 731 to 
include a reference to E.O. 13488. We also are making a correction to 
the citation format.

Regulatory Flexibility Act

    OPM has determined that this rule will not have a significant 
economic impact on a substantial number of small entities because they 
will apply only to Federal agencies and employees.

Executive Order 13563 and Executive Order 12866, Regulatory Review

    This rule has been reviewed by the Office of Management and Budget 
in accordance with E.O. 13563 and E.O. 12866.

E.O. 13132, Federalism

    This regulation will not have substantial direct effects on the 
States, on the relationship between the National Government and the 
States, or on distribution of power and responsibilities among the 
various levels of government. Therefore, in accordance with Executive 
Order 13132, it is determined that this rule does not have sufficient 
federalism implications to warrant preparation of a Federalism 
Assessment.

E.O. 12988, Civil Justice Reform

    This regulation meets the applicable standard set forth in section 
3(a) and (b)(2) of Executive Order 12988.

Unfunded Mandates Reform Act of 1995

    This regulation will not result in the expenditure by State, local, 
or Tribal governments of more than $100 million annually. Thus, no 
written assessment of unfunded mandates is required.

Congressional Review Act

    This action pertains to agency management, personnel and 
organization and does not substantially affect the rights or 
obligations of non-

[[Page 69608]]

agency parties and, accordingly, is not a ``rule'' as that term is used 
by the Congressional Review Act (Subtitle E of the Small Business 
Regulatory Enforcement Fairness Act of 1996 (SBREFA)). Therefore, the 
reporting requirement of 5 U.S.C. 801 does not apply.

Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35)

    This final regulatory action will not impose any additional 
reporting or recordkeeping requirements under the Paperwork Reduction 
Act.

List of Subjects in 5 CFR Part 731

    Administrative practices and procedures, Government employees.

U.S. Office of Personnel Management.
John Berry,
Director.

    Accordingly, OPM amends part 731, title 5, Code of Federal 
Regulations, as follows:

PART 731--SUITABILITY

0
1. The authority citation for part 731 is revised to read as follows:

    Authority:  5 U.S.C. 1302, 3301, 7301; E.O. 10577, 3 CFR, 1954-
1958 Comp., p. 218, as amended; E.O. 13467, 3 CFR, 2009 Comp., p. 
198; E.O. 13488, 3 CFR, 2010 Comp., p. 189; 5 CFR, parts 1, 2 and 5.

Subpart A--Scope

0
2. In Sec.  731.104, remove ``or'' at the end of paragraph (a)(3), 
replace the period at the end of paragraph (a)(4) with ``; or'', and 
add a new paragraph (a)(5) to read as follows:


Sec.  731.104  Appointments subject to investigation.

    (a) * * *
    (5) Appointment to a covered position where there has been a break 
in service of less than 24 months, and the service immediately 
preceding the break was in a covered position, an excepted service 
position, or a contract employee position described in paragraphs 
(a)(1) to (a)(4) of this section.
* * * * *

0
3. In Sec.  731.106, revise paragraphs (d), (e), and (f) to read as 
follows:


Sec.  731.106  Designation of public trust positions and investigative 
requirements.

* * * * *
    (d) Reinvestigation requirements. (1) Agencies must ensure that 
reinvestigations are conducted and a determination made regarding 
continued employment of persons occupying public trust positions at 
least once every 5 years. The nature of these reinvestigations and any 
additional requirements and parameters will be established in 
supplemental guidance issued by OPM.
    (2) If, prior to the next required reinvestigation, a separate 
investigation is conducted to determine a person's eligibility (or 
continued eligibility) for access to classified information or to hold 
a sensitive position, or as a result of a change in risk level as 
provided in paragraph (e) of this section, and that investigation meets 
or exceeds the requirements for a public trust reinvestigation, a new 
public trust reinvestigation is not required. Such a completed 
investigation restarts the cycle for a public trust reinvestigation for 
that person.
    (3) Agencies must notify all employees covered by this section of 
the reinvestigation requirements under this paragraph.
    (e) Risk level changes. If an employee or appointee experiences a 
change to a higher position risk level due to promotion, demotion, or 
reassignment, or the risk level of the employee's or appointee's 
position is changed to a higher level, the employee or appointee may 
remain in or encumber the position. Any upgrade in the investigation 
required for the new risk level should be initiated within 14 calendar 
days after the promotion, demotion, reassignment or new designation of 
risk level is final.
    (f) Completed investigations. Any suitability investigation (or 
reinvestigation) completed by an agency under paragraphs (d) and (e) of 
this section must result in a determination by the employing agency of 
whether the findings of the investigation would justify an action under 
this part or under another applicable authority, such as part 315, 359, 
or 752 of this chapter. Section 731.103 addresses whether an agency may 
take an action under this part, and whether the matter must be referred 
to OPM for debarment consideration.

Subpart B--Suitability Determinations and Actions

0
4. Revise Sec.  731.206 to read as follows:


Sec.  731.206  Reporting requirements.

    Agencies must report to OPM the level or nature, result, and 
completion date of each background investigation or reinvestigation, 
each agency decision based on such investigation or reinvestigation, 
and any personnel action taken based on such investigation or 
reinvestigation, as required in OPM issuances.

[FR Doc. 2011-29057 Filed 11-8-11; 8:45 am]
BILLING CODE 6325-39-P