Proposed Regulations to Implement Section 522 of the Energy Policy and Conservation Act Concerning Conflicts of Interest

Published by the Government Accountability Office on 1977-04-20.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                              WASHINGTON, D.C. 20S4B

The I{Qtl()rable John D. Dingell, Chairman
Subc0tttruittee on Energy and Power
Interstate and Foreign Connet'ce Committee
Houae of Representatives
Dear Mr. Chairman.:

     By lette-r dated October 26, 1976~ this Office responded to a request
from you aud former Repre$entative Ken Rechler that we review the proposed
regulations of the Department of the Interior and the Federal Energy Ad-
min.iatration to impl$ment section 522 of the Energy Policy and Conservation
Act, 42    u.s .. c.§ 6392 (Supp. V, 1975), c.oncerning conflicts of interest.
Thereafter~      by letter dated November 4, 1976, you provided a copy of our
response, along with additional comuents, tQ the Secretary of the Interior
for his coneideration iu finalizing his DapartI11ent 1 a con.flict of interest
regulations. Your letter also ditected the Secretary to:
     uPlease provide us a. copy of the regulations when
     prot!Ulgated together with .a statement of the actions
     taken to carry out tile GA.O's ~eeoilU:lSO.da.tions, Please
     also provide a copy tharreof to the GAO for review
     and    e~t                to us.u

     By letter dated February B, 1977, Mr. Richard R. Rite. Acting
Assistant Secretary,. Ad:ministratfo·n and Management, sent us a copy of
 the Dapa.rtment of the Interior's revised e0t1flict of interest regulations
 appearing at 41 Fed. Reg. 56100 (December 23, 1976) as well as copies
_of two additional letters stating the actions taktn by the Department
 in reaponse to the comments made on its proposed conflict of interest
 regulations. We have reviewed the liepartment' s final regulations, and
we believe that all out• concerne hava been properly met:. ..

     Among the coments ms.de on the Department'a :proposed regulations
was a recoll!mendation that th~y be revised to lllake it clear that under
section 522 of the Act, all officers-and employees are required to file
financial disclosure statements unless they are specifically exelllpted.
We note that 43 c.r.R. § 20.735-20(b) now follows this recommendation,
It was also. recotttz1ended that non-policymaking positions be af firma.tively
!dentified by reviewing the po$ition' s functions rather than by simply
using the GS-13 grade level as a division point between policymaking


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 and non-policymaking positions. Acting Assistant Secretary Hite 1 s
 February S letter to you indicates that thia recollll!lendation h6s also
 been implemented. R~ states:
          • **While you wlll gee grade level ·~uons
         fot uuborditl.ate professional and administrative
         posi~oIU1 1 these grade levels vary by organiza~ional
         unit and were detex.'lllined after an analysis of the
     · dutieo and rasponsibilities of       ~ach grad~ level

.See also 43 C.F.R. § 20.735-20(b)(2) and Appendix F.

         In your l~tter      of November 4, 1976, to tbe Secretary you                    e~pressed
 concel'll o-ver the proposed definition of        Hknown   f:f.nancial interests!1 and
 questioned whether this definition itteluded continuin~ financial rela-
 tionships which a pers01l. may 11.ave with a prior fi:rm, such as a pension
 or retire111ent plan. shared ineome agreement         o~   an other similar                arran~e­
 ment.        The definition of "peemdary intei:est'·1 1u 4l C..F .. It. 5 20. 735-20(a){5)
 now apecifically eta.tes that relationships with prior f irtila are included.
 Further, you expressed a desire that the financial disclosure s~tements
 should be ma.de available to the genel:'al public in some central location
 rathei: than only at the locations where they are to be filed. We :note
 . that 43 C.F.R. § Z0.73S-20(g) ~provides that within 30 days after
  . receipt of the state'CllQnts,. they will be available t:o the public at the
' Department's Library,. 18th and C Streets, N.W., Waehington, D.C. 2.024D.

       You also indicated that certain information concerning the term
 ncov&red &lllployeeP which was set forth in  t·h~ preambl~ to the Depat'tlltent 1s
 pt'oposed regulatio-ns,, should bo ineludad in the regulations themselves.
 Now 43 C.F .. R. § 20 .. 735-20(a) (l) defines the tam Hcovered                                       and
 43 C.F.R.       §   20.735-20(b) establishes who shall file financial disclosure
 stat~ts.        Also, under thua regulations~ all          o-ffic<n:s or employees
 pe~fol:'fidng functions unde~ the .Act are required  to file Utll.ess specif i-
 ~lly  exempted beeau.ae r.he.y perform notl.-polieymak.ing and non-regul~toi:y
 functions. The exempted positions are set forth in Appendix Ji' to part
 20 of title 43, Code of Federal Regulations. Appendix F is revised and
 updated as of September 30 of each year, .and.does not uempt nnyone uho
 either perfot:mS o~ performed an~ regulatory or polieymaki~g function
 during the year up to Septett:ber 30. ThU8 in practice• thfl Department
 not ouly re~U.1rea officers and employees who occopy positions where they
 regularly perform functions of a regulatory or policymkillg ooture to
 file f inan.cial dillclesur.e stat~nts. but also requi~es filing for officers

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and elllployees who occupy positions where    th~y may~     even   occasionally~
during the course of the year perform a fm\ction which is of a- regulatory
or policymaking nature. Following finalization of the list of positions
appearing in Appendix F in October, the Ethics .Counselor notifies and
furnishes to each employee not ~4e:m.pted a financial. disclosur~ statement
by .December 15 of the same year which the offieer or employee must fill
out ancl return by February l of the next year.

     Since there is a ti.me. lag between publication;-. of Apfendix F and
the end of the year to llhi<:h the. filing appliea, it is pqssible that
someone exempted under App&idi~ F might thereaf t~r perform a polieymaking
or regulatory function prior to the end of the year. How(!.ver, w~ weTe.
:informally advised that ~hould such a situation arise and become kn~'n
to au Ethics Counselor, th~ officer or employee would be requested by
the Ethics Counselor to file a financial discloaure statemeti:t.

     We hope that the foregoing information is of 4S$1Stance to you.

                                       Sincerely   your~,

                            ._ J)eJftitj/" Compttoller General
                                     -of tlie United Stat es.

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