United States General Accounting Office % GAO Report “‘tothe Chairman, Subcommittee on Civil Service, Committee on Post Office and Civil Service, House of Representatives March 1990 PERSONNEL PRACTICES The Department of Energy’s Use of Schedule C Appointment Authority United States GAO General Accounting Office Washington, D.C. 20648 General Government Division B-229415 March 8, 1990 The Honorable Gerry Sikorski Chairman, Subcommittee on Civil Service Committee on Post Office and Civil Service Houseof Representatives Dear Mr. Chairman: This report respondsto your January 31, 1990, request for information on ScheduleC employeesat certain offices within the Department of Energy (DOE). More specifically, you asked us to identify the current number of ScheduleC employeesin DOE’S Office of Public Affairs and Office of Congressionaland Intergovernmental Affairs and to verify that these employeesoccupied positions that had been approved by the Office of Personnel Management(OPM) as required. On February 7,1990, we briefed the Subcommittee on the results of our work. In addition to providing the requested information, we advised the Subcommittee that DOE had detailed three of its permanent Schedule C employees directly to the White House, a practice we criticized in ear- lier reports as an inappropriate use of ScheduleC appointment author- ity.’ As requested, this report summarizes information provided at that briefing. ScheduleC positions are positions excepted from the competitive service Background becausethey are either policy determining or involve a close and confi- dential working relationship with a key official2 A key official can be a presidential appointee, another ScheduleC appointee, or an SESmember who is not occupying a position reserved for career membersof the SES. ScheduleC appointees may not report to or through officials in the com- petitive service and a close and confidential working relationship does not exist unless the appointees are subject to the immediate supervision of the key official. OPM must approve not only the establishment of each permanent Sched- ule C position but also any subsequentposition changes,such as in title, grade, immediate supervisor, and organizational location. OPM’S approval ‘Personnel Practices: Federal Employees Detailed From DOD to the White House (GAO/GGDELS33, Mar 14,1988) and PersonnelPractices: Detailing of Federal Employees to the White House(GAO/ GGD-87.lOZBR, July 22, 1987). “See 5 CFR 213.3301 et seq. and Chapter 213 of the Federal Personnel Manual. Page 1 GAO/GGD9981 DOE’s Use of Schedule C Appointment Authority B-229416 whether or not the employee was in a permanent or a temporary posi- tion. We compared this list to (1) a DOE report updated through February 1, 1990, listing all permanent and temporary ScheduleC employeesand (2) OPM position certification documents maintained at DOE. To determine whether OPM approved all ScheduleC positions located in these two LWE offices, we discussedwith an OPM official the processOPM follows in approving ScheduleC positions. We compared DOE'S list of ScheduleC positions with OPM's records of approved and occupied posi- tions. These records included OPM'S most recent ScheduleC Position and Incumbent List and its log of approved positions through February 1, 1990. We also reviewed OPM'S records for all DoEoccupiedpositions to verify the accuracy of OPM'S Position and Incumbent List. We visited the work station for each ScheduleC employee in DOE'S Offices of Public Affairs and Congressionaland Intergovernmental Affairs and examined the telephone directory to verify that employees were located in the office that OPM had approved. During our review, we noted that DOE had detailed three ScheduleC employeesto the White House.These details were from offices not origi- nally included in our review. However, becauseof our earlier concerns with this practice, we reviewed the circumstancessurrounding these details. We reviewed the personnel folders for the ScheduleC employees on detail to the White House to document the beginning and ending dates for the detail, the dates entered on duty, OPM'S approval of the ScheduleC position at DOE, and the agreementsfor reimbursement. We discussedwith DOE officials whether the employeeswere hired directly for the White House,whether the White House had reimbursed DOE, and whether DOE had reported the details to the Senate and House Commit- tees on Appropriations, as required by law. Our work was done in February 1990 at DOE and OPM headquarters in Washington, DC., and in accordancewith generally acceptedgovern- ment auditing standards. page3 B229416 DOE records show that three permanent ScheduleC employees were Inappropriate Use of detailed to the White House from DOE’s Office of the Secretary and Schedule C Office of Managementand Administration. As of February 1, 1990, Appointment these employeeshad been detailed for periods ranging from 123 to 374 days. While these offices were not originally included in our review, we Authority included them becauseof our previous concernswith details. In review- ing the justification for these positions, we found that DOE had provided inaccurate information to OPM in requesting approval to establish them. DOE did not comply with OPM'S regulations and guidelines for ScheduleC excepted service appointments. These regulations and guidelines pro- vide that agencies,upon specific authorization by OPM, may make appointments to positions that are policy determining or that involve a close and confidential working relationship with a key official. OPM approves ScheduleC positions on this basis and requires that ScheduleC employeesbe supervised directly by the key official. Any changesto this supervisory relationship must be approved by OPM. At the time DOE provided information to OPM requesting permanent authorization for these positions, the individuals proposed for the posi- tions were temporary ScheduleC employees and had already been detailed to the White House for periods ranging from 61 to 182 days. However, DOE prepared position descriptions that showed that the posi- tions were located within DOE and that the relationship between the ScheduleC employee and the key official was confidential in nature. The position descriptions were signed by DOE officials who certified that (1) the descriptions were accurate statements of the major duties and responsibilities for the positions, (2) the positions were located in DOE, and (3) that the positions were necessaryto carry out government functions. An OPM official told us that OPM approves ScheduleC positions on the basis of the paperwork submitted by the agencies.As a practical matter, OPM does not verify the accuracy of the paperwork nor does it review agencies’use of ScheduleC appointment authority. As a result, unless otherwise informed, OPM has no way of knowing if such positions are being created for detailing. When OPM approved the ScheduleC positions, DOE had already detailed the incumbents to the White House.Therefore, the confidential relation- ship between the incumbents and the key DOE officials, the basis for a ScheduleC appointment, no longer existed. In addition, DOE did not request approval from OPM to changethe supervisory relationships. Page 5 GAO/GGIHKMl DOE’s Use of ScheduleC Appointment Authority E.229416 if the detail extends beyond 180 days. The law also requires the Presi- dent to submit an annual report to Congressshowing the number of employees detailed to the five specified offices over 30 days and the reimbursements made to agenciesfor employeesdetailed more than 180 days in a fiscal year. DOE had not billed the White House for the two ScheduleC employees whose details had exceeded180 days. As of February 1,1990, the bills for these two employees were 66 and 94 days overdue. An official from DOE's Office of Headquarters Accounting Operations told us that DOE'S procedures call for billing the White House on a quarterly basis when details are for an indeterminate length of time. Although the Director, Office of Personnel and Career Development claimed that notification of these details had been forwarded to Headquarters Accounting Opera- tions, the accounting staff had no record of having received the notifica- tions. On February 16, 1990, DOE arranged with the White House to expedite reimbursement totaling about $10,000 for these two details. On February 23, 1990, DOE prepared a procedure to improve controls over the transmission of reimbursable detail agreementsbetween the Office of Personnel and the Office of Headquarters Accounting Operations. In our earlier reports, we also found that the 13 departments were not billing the White House for their employeesdetailed over 180 days in a fiscal year to perform White House functions. In the March 1988 report, White House officials said they had instituted new procedures starting in fiscal year 1988 to ensure that agenciesare reimbursed when appro- priate. One official said that the White House Office, in accordancewith the new procedures, would monitor those agenciesthat do not request reimbursement. However, the official said that responsibility for requesting payment must remain with the detailing agency. Public Law 100-202, which was enacted on December21, 1987, gener- Details to Other ally requires executive branch agenciesto submit annual reports to the Agencies Are Not Senate and House Committees on Appropriations on employeesdetailed Being Reported to other agenciesincluding the White House. The Director of DOE's Office of Personnel and Career Development said he was unaware that such a requirement existed and therefore no such reports had been prepared. In order to determine if this was an isolated situation, we checked with officials at the Department of Agriculture and at the Department of Health and Human Servicesto seeif those agencieswere preparing the annual reports. We selectedthese agenciesbecauseof their size. The page7 GAO/GGMO-61 DOE’sUse of Schedule C Appointment Authority 5229416 assure that they continue to be prepared in the future. We also recom- mend that the Secretary implement, without delay, the proceduresthat were recently prepared to assurethat agenciesare promptly billed for such details. On the basis of our findings at DOE and our earlier work on details to the Recommendationsto White House,we recommendthat the Director of OPM require agenciesto the Director, OPM certify in their applications that ScheduleC positions are not being established solely or primarily for details. We also recommendthat the Director of OPM disapprove applications that do not contain this certifi- cation In addition, we recommendthat the Director of OPM periodically monitor agencies’use of ScheduleC employeesfor compliance with its regulations and guidelines. Finally, we recommend that the Director, OPM, reemphasizeto agencies that ScheduleC employees can only occupy positions in the agency that OPM approves. It should make clear that any changesto these assign- ments must be approved by OPM and it should also encourageagenciesto submit annual reports as required by Public Law 100-202. A draft of this report was discussedwith DOE and OPM officials. They generally agreed with the facts presented and their comments were con- sidered in preparing our final report. As arranged with the Subcommittee,we plan no further distribution until 30 days from the date of this report unless you releaseit earlier. At that time, we will send it to the Secretary of Energy, the Director of OPM, and other interested parties upon request. page9 Page 11 GAO/GGD9O-61DOE’sUse of Schedule C Appointment Authority ---,.,- .- ,,,,..,.- -.. . Appendix Major Contributors to This Report Norman A. Stubenhofer, Assistant Director, Federal Human Resource General Government Management Issues Division, Washington, - Helen Fauntleroy, Senior Evaluator D.C. James J. Grace, Senior Evaluator Katrina L. Miller, Clerk Typist Jeffrey S. Forman, Senior Attorney Office of the General Counsel, Washington, D.C. Page 12 GAO/GGD90-61DOE’sUse of ScheduleC Appointment Authority Is229416 Major contributors to this report are listed in the appendix. Pleasecon- tact me at 275-5074 if you or your staff have any questions concerning the report. Sincerely yours, Bernard L. Ungar Director, Federal Human Resource Management Issues Page 10 GAO/GGD9081 DOE’sUse of schedule C Appointment Authority B-229416 officials told us that they were not aware that such reports were required and therefore the reports had not been prepared. DOE followed OPM'S regulations and guidelines when it established 19 Conclusions permanent ScheduleC positions in its Offices of Public Affairs and Con- gressional and Intergovernmental Affairs. However, as our previous reports have stressed,WE'S hiring of three persons and immediately assigning them to the White Housewas an inappropriate use of Schedule C appointment authority. The purpose of this authority is specifically to facilitate the employment of policymakers and confidential assistants within the agency for which the positions are established. This purpose is frustrated when positions are created for someother use. We continue to believe that a go-day prohibition against detailing Sched- ule C employees would be appropriate and that OPM should reconsider our previous recommendation. In addition, we believe OPM'S approval process for ScheduleC positions needsto be strengthened to preclude the inappropriate hiring of ScheduleC employeesby agenciesfor the purpose of detailing them to the White House. In our view, OPM should not approve ScheduleC positions being established solely or primarily for the purpose of detailing. In addition, OPM should (1) require agencies applying for a ScheduleC position to certify that the position is not being established for that purpose and (2) periodically monitor agencies’ use of ScheduleC employees for compliance with its requirements. DOE did not bill the White House on time for two details during fiscal year 1989 and had not prepared reports on details during fiscal year 1989 for the Senate and HouseCommittees on Appropriations. We believe that, in order to comply with its own billing practices, DOE needs to implement procedures that make sure that agenciesare billed on time. We also believe DOE needsto implement procedures to assure that required reports on detailed employeesare prepared in accordancewith law. Recommendationsto We recommendthat the Secretary of Energy discontinue the practice of hiring ScheduleC appointees and assigning them immediately to the the Secretary of White House.We also recommendthat the Secretary report the three Energy details to OPM and not renew them at their conclusion. Additionally, we recommendthat the Secretary of Energy prepare the reports on details for fiscal year 1989 and implement procedures to Page 8 GAO/GGD9041 DOE’sUse of ScheduleC Appointment Authority Thus, DOE'S action was an inappropriate use of ScheduleC authority becausean immediate detail to the White Housedoes not facilitate the employment of policymakers and confidential assistants in the agency for which the position was established. WE'S Special Assistant to the Secretary and White House Liaison told us that DOE had hired the employeesunder ScheduleC authority for detail to the White House.She said that two of these employeesnever worked at DOE and that the third did only for a brief time as a temporary Sched- ule C employee. This official said that the employees are supervised on a daily basis by a White House official and not the DOE supervisor that OPM had approved. The official told us she did not believe anything improper had been done and was not aware that ScheduleC position changes neededto be approved by OPM. In 1987 and 1988, we reported on the practices of 13 federal depart- ments, including DOE, in detailing employeesto the White House.We found that each of the departments had inappropriately detailed Sched- ule C employees to the White Houseunder circumstances similar to those described in this report. In our March 1988, report we recom- mended that OPM issue regulations prohibiting the detailing of Schedule C appointees within 90 days of appointment. We reported that such action would preclude the inappropriate use of ScheduleC authority without precluding the White House or federal agenciesfrom using Schedule C employeesto help meet their staffing needs.Even with adop- tion of such a prohibition, the White House and federal agencieswould still have the option to directly appoint and pay their own ScheduleC employees. The former OPM director disagreed with our recommendation. She said that if there was a legitimate need for an immediate detail of a Schedule C appointee to the White House,such a regulation would only serve as an obstacle to delay the accomplishment of an Administration task. Public Law 95-5’70,dated November 2, 1978, provides for detailing Delays in Billing the employees on a nonreimbursable basis to five White House offices-the White House for White HouseOffice, the Executive Residenceat the White House,the Details Over 180 Days Office of the Vice President, the Office of Policy Development, and the Office of Administration. Thesenonreimbursable details must not exceed 180 calendar days in a fiscal year. When the detailed employee is performing services that would otherwise be performed by White House employees,the White Houseis required to reimburse the lending agency Page6 GA0,‘GGD90-61DOE’sUse of Schedule C Appointment Authority 5229416 As of February 1,1990, DOE had 19 permanent ScheduleC positions in Approvals Were the Office of Public Affairs and in the Office of Congressionaland Inter- Obtained for the governmental Affairs. The following table shows the actual physical Schedule C Positions locations of these 19 permanent poskions, as well as eight temporary positions that did not require OPM'S approval. We Reviewed Table 1: Schedule C Positions in Selected WE Officea, February 1,199O Poritions DOE office Permanent Temporary Total Public Affairs 8 5 13 Congressional and Intergovernmental Affairs 11 3 14 Total 19 8 27 We reviewed the circumstancessurrounding the approval of these 19 permanent ScheduleC positions and found that OPM'S and DOE’S records were in agreement for 16 of the positions. There was some discrepancy for the remaining three positions. OPM had approved one position for the Office of Congressionaland Intergovernmental Affairs while DOE showed the location of the position to be in the Office of Public Affairs. DOE officials told us that this organizational change resulted from a recent reorganization and that they were not aware such changes had to be reported to OPM. In addition, OPM's reports showed that two positions were located in the Office of the Secretary while DOE reported that one of the positions was in the Office of Public Affairs and the other was in the Office of Congressionaland Intergovernmental Affairs. OPM'S records showed that it had approved the positions for the locations reported by DOE, but OPM's report erroneously listed these two positions within the Office of the Secretary. In reviewing OPM's Position and Incumbent List, we found that OPM included three positions in the Office of Congressionaland Intergovern- mental Affairs that were not reported by DOE. DOE officials told us that two of these positions were vacant as of October 1989 but for some rea- son had not been reported to OPM, as required. They said that the third position was vacated in January 1990. DOE reported this latest changeto OPM, but OPM had not received the report at the time of our review. DOE officials told us that they would submit the required documents for OPM'S approval of the changesthat occurred in 1989. page4 5229416 of a ScheduleC position is revoked immediately when the position is vacated. Even though agenciesmust obtain OPM approval for permanent ScheduleC positions, agenciesmay establish temporary ScheduleC posi- tions without OPM'S approval immediately following a changein the presidential administration or within 1 year following the changeof an agency head or the creation of a new agency.Each temporary appoint- ment is restricted to a 120-day period, which may be extended once for an additional 120 days. Temporary positions may also be converted to permanent ScheduleC positions by obtaining OPM approval. As of February 1, 1990, DOE had 8 permanent ScheduleC positions in the Results in Brief Office of Public Affairs and 11 in the Office of Congressionaland Inter- governmental Affairs, DOE complied with OPM'S regulations and guide- lines in establishing these 19 positions. However, M)E had not reported to OPM changesto ScheduleC positions in these two offices that it made during 1989 although it was required to do so. DOE officials said they would notify OPM of these changesafter we brought the matter to their attention. In addition to establishing the above 19 positions, DOE used ScheduleC appointment authority to hire three permanent employeesand detail them directly to the White Housein 1989. We believe these three actions were inappropriate since, in obtaining OPM approval for these positions, DOE had certified that the positions and the appointees would be located within DOE. Use of ScheduleC authority to create positions in DOE solely for the White House’suse frustrates the purpose of this authority. In addition, DOE did not follow its proceduresin billing the White House for two of the details and did not annually report the details to the Senate and House Committees on Appropriations as required by law. Our objectives were to determine (1) the number of ScheduleC positions Objectives, Scope,and in DOE'S Office of Public Affairs and Office of Congressionaland Inter- Methodology governmental Affairs as of February 1, 1990; (2) whether OPM had approved these positions; and (3) whether the employeeshired to occupy these positions were located in the office approved by OPM. To determine the number of ScheduleC positions, we had WE prepare for us a list of these positions in the Office of Public Affairs and in the Office of Congressionaland Intergovernmental Affairs. This list included each employee’s name, title, grade, entrance-on-duty date, and Page2 GAO/GGD9061DOE'sUseofScheduleCAppointmentAuthority
Personnel Practices: The Department of Energy's Use of Schedule C Appointment Authority
Published by the Government Accountability Office on 1990-03-08.
Below is a raw (and likely hideous) rendition of the original report. (PDF)