Post-Employment Conflict of Interest Restrictions; Exemption of Positions and Revision of Departmental Component Designations, 10339-10342 [E7-4167]

Agencies

• Office of Government Ethics
• Government Ethics Office

[Federal Register Volume 72, Number 45 (Thursday, March 8, 2007)]
[Rules and Regulations]
[Pages 10339-10342]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-4167]



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Federal Register / Vol. 72, No. 45 / Thursday, March 8, 2007 / Rules 
and Regulations

[[Page 10339]]



OFFICE OF GOVERNMENT ETHICS

5 CFR Part 2641

RIN 3209-AA14


Post-Employment Conflict of Interest Restrictions; Exemption of 
Positions and Revision of Departmental Component Designations

AGENCY: Office of Government Ethics (OGE).

ACTION: Final rule, amendments.

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SUMMARY: The Office of Government Ethics is issuing this rule to 
provide notice of the exemption of certain senior employees' positions 
from the one-year post-employment restriction of 18 U.S.C. 207(c), to 
revoke certain existing department component designations, and to 
designate an additional component for purposes of that provision.

DATES: The amendment to appendix A to part 2641 (as set forth in 
amendatory paragraph 2), is effective March 8, 2007.
    The amendments to appendix B to part 2641 (as set forth in 
amendatory paragraph 3) are effective March 8, 2007.
    Finally, the removal of the entire listing for the Department of 
Homeland Security in appendix B to part 2641 (as set forth in 
amendatory paragraph 4) is effective June 6, 2007.

FOR FURTHER INFORMATION CONTACT: Shelley K. Finlayson, Attorney-
Advisor/Congressional Liaison Officer, or William E. Gressman, Senior 
Associate General Counsel, Office of General Counsel and Legal Policy, 
Office of Government Ethics, Telephone: 202-482-9300; TDD: 202-482-
9293; FAX: 202-482-9237.

SUPPLEMENTARY INFORMATION: 

A. Substantive Discussion

Exemption of Positions

    18 U.S.C. 207(c) prohibits a former ``senior employee'' for a 
period of one year from knowingly making, with the intent to influence, 
any communication to or appearance before an employee of the department 
or agency in which he served in any capacity during the one-year period 
prior to termination from senior service, if that communication or 
appearance is made on behalf of any other person, except the United 
States. For purposes of 18 U.S.C. 207, a ``senior employee'' is any 
employee (other than an individual covered by the ``very senior 
employee'' one-year restriction in 18 U.S.C. 207(d)) who was employed 
in a position for which the rate of pay is specified in or fixed 
according to the Executive Schedule, in a position for which the rate 
of basic pay is equal to or greater than 86.5 percent of the rate of 
basic pay payable for level II of the Executive Schedule, or in a 
position which is held by an active duty commissioned officer of the 
uniformed services who is serving in a grade or rank for which the pay 
grade is O-7 or above. The term includes those individuals appointed by 
the President to a position under 3 U.S.C. 105(a)(2)(B) or by the Vice 
President to a position under 3 U.S.C. 106(a)(1)(B). The term also 
includes any person who was assigned from a private sector organization 
to an agency under the Information Technology Exchange Program, 5 
U.S.C. chapter 37. An individual is subject to section 207(c) as a 
result of service as a special Government employee only if the 
individual served 60 or more days as a special Government employee 
during the one-year period before terminating service as a senior 
employee.
    The representational bar of 18 U.S.C. 207(c) usually applies to all 
senior positions. However, 18 U.S.C. 207(c)(2)(C) provides that 
whenever the Director of OGE determines, after a review requested by 
the department or agency concerned, that the imposition of the 
restrictions with respect to a particular position or positions would 
create an undue hardship on the department or agency in obtaining 
qualified personnel to fill such position or positions, and granting 
the waiver would not create the potential for use of undue influence or 
unfair advantage, the position or category of positions is exempted 
from the one-year representational prohibition.
    Any senior employee position is eligible for exemption except 
persons: Employed at a rate of pay specified in or fixed according to 
subchapter II of 5 U.S.C. chapter 53 (the Executive Schedule); in 
positions whose occupants are appointed by the President pursuant to 3 
U.S.C. 105(a)(2)(B); in positions whose occupants are appointed by the 
Vice President pursuant to 3 U.S.C. 106(a)(1)(B); or assigned by a 
private sector organization to an agency under the Information 
Technology Exchange Program. Positions exempted from 18 U.S.C. 207(c) 
are listed in appendix A to 5 CFR part 2641, OGE's regulation governing 
the executive branch post-employment conflict of interest restrictions.
    The Director of OGE regularly reviews the position exemptions and, 
in consultation with the department or agency concerned, makes such 
additions and deletions as are necessary. As specified in 5 CFR 
2641.201(d)(3)(iii), the Director shall respond to each initial 
exemption request from agency ethics officials and annually publish a 
compilation of all exempted positions or categories of positions. 
Section 2641.201(d)(5) further provides that, before exempting a 
position or positions from 18 U.S.C. 207(c), the Director must find: 
(1) That granting the exemption would not create the potential for use 
by former senior employees of undue influence or unfair advantage based 
on past Government service; and (2) that the imposition of the 
restriction would create an undue hardship on the particular department 
or agency in obtaining qualified personnel to fill such positions. 
Relevant factors for the second finding may include the payment of a 
special rate of pay to the incumbent of the position pursuant to 
specific statutory authority or a requirement that the incumbent of the 
position have outstanding qualifications in a scientific, 
technological, or other technical discipline.
    Pursuant to the procedures prescribed in 5 CFR 2641.201(d), one 
agency forwarded two written requests in 2003 to OGE requesting that 
its listing in appendix A be amended.

[[Page 10340]]

Securities and Exchange Commission

    In 2003, the Securities and Exchange Commission (SEC) requested 
that the Director of OGE exempt various new positions (termed ``SK'' 
positions) from 18 U.S.C. 207(c). These positions previously had been 
classified at GS-15 and below. However, when the SEC implemented ``pay 
parity'' authority under Pub. L. 107-123 to improve recruitment and 
retention, these positions then exceeded the pay threshold of 18 U.S.C. 
207(c)(2)(A)(2) despite no increase in duties or responsibilities. Also 
included in one of the SEC requests was the position of Deputy Chief 
Litigation Counsel, Division of Enforcement, a position which itself is 
supervised by a position that was already exempted by OGE effective on 
October 29, 1991.
    After carefully reviewing the changes requested by the SEC in light 
of the criteria in 18 U.S.C. 207(c)(2)(C) as implemented in 5 CFR 
2641.201(d)(5), the then-Director of OGE granted these requests by 
letters dated November 10, 2003 and December 4, 2003. OGE is now 
amending appendix A to part 2641 to include these additional exempted 
SEC positions, retroactively effective to those respective dates (as 
parenthetically indicated in the amended appendix listing for the SEC 
positions concerned). An exemption ``shall be effective as of the 
effective date of the Director's written response to the designated 
agency ethics official indicating that the request for exemption has 
been granted.'' 5 CFR 2641.201(d)(4). Once granted, the exemptions 
inured to the benefit of the individuals who held the positions when 
the exemptions took effect and their successors, but were not effective 
as to employees who terminated senior service from such positions prior 
to the effective date of the exemptions.

Revocation and Addition of Departmental Components

    The representational bar of 18 U.S.C. 207(c) also usually extends 
to the whole of any department or agency in which a former senior 
employee served in any capacity during the year prior to termination 
from a senior employee position. However, 18 U.S.C. 207(h) provides 
that whenever the Director of OGE determines that an agency or bureau 
within a department or agency in the executive branch exercises 
functions which are distinct and separate from the remaining functions 
of the department or agency and there exists no potential for use of 
undue influence or unfair advantage based on past Government service, 
the Director shall by rule designate such agency or bureau as a 
separate component of that department or agency. As a result, a former 
senior employee who served in a ``parent'' department or agency is not 
barred by 18 U.S.C. 207(c) from making communications to or appearances 
before any employees of any designated component of that parent, but is 
barred as to employees of that parent or of other components that have 
not been separately designated. Moreover, a former senior employee who 
served in a designated component of a parent department or agency is 
barred from communicating to or making an appearance before any 
employee of that component, but is not barred as to any employee of the 
parent or of any other component.
    Under 18 U.S.C 207(h)(2), component designations do not apply to 
persons employed at a rate of pay specified in or fixed according to 
subchapter II of 5 U.S.C. chapter 53 (the Executive Schedule). 
Component designations are listed in appendix B to 5 CFR part 2641.
    The Director of OGE regularly reviews the component designations 
and determinations and, in consultation with the department or agency 
concerned, makes such additions and deletions as are necessary. 
Specifically, the Director ``shall by rule make or revoke a component 
designation after considering the recommendation of the designated 
agency ethics official.'' 5 CFR 2641.201(e)(3)(iii). Before designating 
an agency component as distinct and separate for purposes of 18 U.S.C. 
207(c), the Director must find that there exists no potential for use 
by former senior employees of undue influence or unfair advantage based 
on past Government service, and that the component is an agency or 
bureau within a department or agency that exercises functions which are 
distinct and separate from the functions of the parent department or 
agency and from the functions of other components of that parent. 5 CFR 
2641.201(e)(6).
    Pursuant to the procedures prescribed in 5 CFR 2641.201(e), two 
departments have forwarded written requests to OGE to amend their 
respective listings in appendix B. After carefully reviewing the 
requested changes in light of the criteria in 18 U.S.C. 207(h) as 
implemented in 5 CFR 2641.201(e)(6), the Director of OGE has determined 
to grant these requests and amend appendix B to 5 CFR part 2641 as 
explained below.

Department of Homeland Security

    The Department of Homeland Security (DHS) has requested that OGE 
remove all separate components from the DHS listing as designated at 69 
FR 68053-68056 (November 23, 2004). The Department has determined that 
a single, undifferentiated organization for purposes of 18 U.S.C. 
207(c) is in the best interest of DHS, the Government, and the public 
as DHS strives to establish a single, unified workforce.
    Accordingly, because the former components no longer exercise 
functions which are distinct and separate, the OGE Director is granting 
the request of DHS and is amending appendix B to part 2641 to remove 
the entire listing for DHS, including all of the DHS components.
    As 5 CFR 2641.201(e)(4) provides, a component designation ``shall 
be effective as of the effective date of the rule that creates the 
designation, but shall not be effective as to employees who terminated 
senior service prior to that date.'' Initial component designations 
were effective as of January 1, 1991. The effective date of subsequent 
designations is indicated by means of parenthetical entries in appendix 
B to part 2641, November 23, 2004 in the case of DHS components as 
noted above.
    A revocation is effective 90 days after the effective date of the 
rule that revokes the designation. Accordingly, the component 
designation revocations made in this rulemaking will take effect June 
6, 2007. Revocations are not effective as to any individual terminating 
senior service prior to the expiration of the 90-day period.

Department of Justice

    The Department of Justice has requested that OGE designate the 
Office on Violence Against Women (OVW) as a distinct and separate 
component of the Department of Justice (DOJ) except as to the Office of 
Justice Programs (OJP) for purposes of 18 U.S.C. 207(c). Legislation 
passed in 2002 established OVW as a separate and distinct office within 
DOJ. Pub. L. 107-273, codified at 42 U.S.C. 3796gg-0(b). However, 
because OVW continues to work closely with OJP on a number of 
initiatives, DOJ has not requested that OVW be considered separate from 
OJP, but only from other designated DOJ components.
    Accordingly, the Director is granting the request of DOJ and 
therefore is amending the DOJ listing in appendix B to part 2641 to 
designate OVW as a new component as discussed.

B. Matters of Regulatory Procedure

Administrative Procedure Act

    Pursuant to 5 U.S.C. 553, as the Director of the Office of 
Government Ethics, I find that good cause exists for

[[Page 10341]]

waiving the general requirements for notice of proposed rulemaking, 
opportunity for public comment, and, except as to the component 
designation revocations (see the preamble discussion above), a 30-day 
delayed effective date. It is important and in the public interest that 
the codification of OGE's previous designations of additional exempted 
positions as well as the designation revocations and new designation 
herein by OGE of the specified separate departmental components, which 
reflect the current organization of the concerned departments, be 
published in the Federal Register and take effect as promptly as 
possible.

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 rule will not 
have a significant economic impact on a substantial number of small 
entities because it affects only Federal departments and agencies and 
current and former Federal employees.

Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply 
to this rule because it does not contain 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), the final rule will not significantly or 
uniquely affect small governments and will not result in increased 
expenditures by State, local and tribal governments, in the aggregate, 
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 
involves a non-major 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 at the same time this rulemaking document is sent to the 
Office of the Federal Register for publication in the Federal Register.

Executive Order 12866

    In promulgating this final 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 rule has not been reviewed by the 
Office of Management and Budget under that Executive order since it 
deals with agency organization, management, and personnel matters and 
is not ``significant'' under the order.

Executive Order 12988

    As Director of the Office of Government Ethics, I have reviewed 
this 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 in 5 CFR Part 2641

    Conflict of interests, Government employees.

    Approved: March 1, 2007.
Robert I. Cusick,
Director, Office of Government Ethics.

0
Accordingly, for the reasons set forth in the preamble, the Office of 
Government Ethics is amending 5 CFR part 2641 as follows:

PART 2641--POST-EMPLOYMENT CONFLICT OF INTEREST RESTRICTIONS

0
1. The authority citation for part 2641 continues to read as follows:

    Authority: 5 U.S.C. App. (Ethics in Government Act of 1978); 18 
U.S.C. 207; 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.


0
2. Effective March 8, 2007, appendix A to part 2641 is amended by 
revising the listing for the Securities and Exchange Commission to read 
as follows:

Appendix A to Part 2641--Positions Exempted From 18 U.S.C. 207(c)

* * * * *

Agency: Securities and Exchange Commission

    Positions:
    Solicitor, Office of General Counsel (effective October 29, 1991).
    Chief Litigation Counsel, Division of Enforcement (effective 
October 29, 1991).
    Deputy Chief Litigation Counsel, Division of Enforcement (effective 
November 10, 2003).
    SK-17 positions (effective November 10, 2003).
    SK-16 and lower-graded SK positions supervised by employees in SK-
17 positions (effective November 10, 2003).
    SK-16 and lower-graded SK positions not supervised by employees in 
SK-17 positions (effective December 4, 2003).

0
3. Effective March 8, 2007, appendix B to part 2641 is amended by 
revising the listings for the Department of Homeland Security and the 
Department of Justice to read as follows:

Appendix B to Part 2641--Agency Components for Purposes of 18 U.S.C. 
207(c)

* * * * *

Parent: Department of Homeland Security

    Components:
    Directorate of Emergency Preparedness and Response (effective 
November 23, 2004; expiring June 6, 2007).
    Directorate of Information Analysis and Infrastructure Protection 
(effective November 23, 2004; expiring June 6, 2007).
    Directorate of Science and Technology (effective November 23, 2004; 
expiring June 6, 2007).
    Federal Law Enforcement Training Center (effective November 23, 
2004; expiring June 6, 2007).
    Transportation Security Administration (effective November 23, 
2004; expiring June 6, 2007).
    United States Secret Service (effective November 23, 2004; expiring 
June 6, 2007).
    United States Coast Guard (effective November 23, 2004; expiring 
June 6, 2007).
* * * * *

Parent: Department of Justice

    Components:
    Antitrust Division.
    Bureau of Alcohol, Tobacco, Firearms and Explosives (effective 
November 23, 2004).
    Bureau of Prisons (including Federal Prison Industries, Inc.).
    Civil Division.
    Civil Rights Division.
    Community Relations Service.
    Criminal Division.
    Drug Enforcement Administration.
    Environment and Natural Resources Division.
    Executive Office for United States Attorneys \2\ (effective January 
28, 1992).
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    \2\ The Executive Office for United States Attorneys shall not 
be considered separate from any Office of the United States Attorney 
for a judicial district, but only from other designated components 
of the Department of Justice.
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    Executive Office for United States Trustees \3\ (effective January 
28, 1992).
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    \3\ The Executive Office for United States Trustees shall not be 
considered separate from any Office of the United States Trustee for 
a region, but only from other designated components of the 
Department of Justice.
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    Federal Bureau of Investigation.
    Foreign Claims Settlement Commission.

[[Page 10342]]

    Independent Counsel appointed by the Attorney General.
    Office of Justice Programs.
    Office of the Pardon Attorney (effective January 28, 1992).
    Offices of the United States Attorney (94).\4\
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    \4\ Each Office of the United States Attorney for a judicial 
district shall be considered a separate component from each other 
such office.
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    Offices of the United States Trustee (21).\5\
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    \5\ Each Office of the United States Trustee for a region shall 
be considered a separate component from each other such office.
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    Office on Violence Against Women \6\ (effective March 8, 2007).
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    \6\ The Office on Violence Against Women shall not be considered 
separate from the Office of Justice Programs, but only from other 
designated components of the Department of Justice.
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    Tax Division.
    United States Marshals Service (effective May 16, 1997).
    United States Parole Commission.
* * * * *

0
Effective June 6, 2007, appendix B to part 2641 is further amended by 
removing the listing for the Department of Homeland Security (and all 
of the components thereunder).

[FR Doc. E7-4167 Filed 3-7-07; 8:45 am]
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