SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Integrity in 
Offshore Energy Resources Act of 2008''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
                     TITLE I--EMPLOYEES OF SERVICE

Sec. 101. Employee ethical standards.
                     TITLE II--PROGRAMS OF SERVICE

Sec. 201. Suspension of royalty-in-kind program.
Sec. 202. Audits.
Sec. 203. Annual reports.
Sec. 204. Prohibition on use of royalty-in-kind revenues for 
                            administrative costs.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Department.--The term ``Department'' means the 
        Department of the Interior.
            (2) Mineral.--The term ``mineral'' has the meaning given 
        the term ``minerals'' in section 2 of the Outer Continental 
        Shelf Lands Act (43 U.S.C. 1331).
            (3) Mineral mining.--
                    (A) In general.--The term ``mineral mining'' 
                means--
                            (i) any activity carried out on Federal 
                        land on or off a claim (with or without a 
                        discovery) for mineral leasing, preleasing, any 
                        related activity, prospecting, exploration, 
                        development, mining, extraction, milling, 
                        beneficiation, processing, or storage of mined 
                        or processed materials with respect to any 
                        mineral that is under the jurisdiction of the 
                        Service and uses reasonably incident to the 
                        activity; and
                            (ii) any reclamation activity for any 
                        mineral and uses reasonably incident to the 
                        activity.
                    (B) Inclusions.--The term ``mineral activity'' 
                includes the construction and use of roads, 
                transmission lines, pipelines, utility corridors, and 
                other means of access across Federal land for an 
                ancillary facility.
            (4) Royalty-in-kind program.--The term ``royalty-in-kind 
        program'' means the program established under--
                    (A) section 342 of the Energy Policy Act of 2005 
                (42 U.S.C. 15902);
                    (B) section 36 of the Mineral Leasing Act (30 
                U.S.C. 192);
                    (C) section 27 of the Outer Continental Shelf Lands 
                Act (43 U.S.C. 1353); or
                    (D) any other similar provision of law.
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.
            (6) Service.--The term ``Service'' means the Minerals 
        Management Service.

                     TITLE I--EMPLOYEES OF SERVICE

SEC. 101. EMPLOYEE ETHICAL STANDARDS.

    (a) Gifts.--
            (1) Prohibition.--
                    (A) In general.--An employee of the Service may not 
                knowingly accept a gift from an entity that is engaged 
                in the business of mineral mining.
                    (B) Exceptions.--Except for the value exception, 
                the regulations providing exceptions to the gift rules 
                for Federal employees for gifts from outside sources (5 
                C.F.R. Part 2635) shall apply to subparagraph (A).
            (2) Violation.--Whoever violates paragraph (1) shall be 
        guilty of a felony and fined under title 18, United States 
        Code, or imprisoned for not more than 2 years, or both.
    (b) Financial Disclosure.--The filing requirements of section 
101(f) of the Ethics in Government Act of 1978 shall apply to an 
employee of the Service in a position classified at an annual income 
equivalent to GS-13 or higher.
    (c) Divestiture Requirement.--An employee of the Service may not 
own stock or any other interest in an entity that is engaged in the 
business of mineral mining during the period of employment of that 
employee by the Service.
    (d) Outside Employment.--An employee of the Service may not be 
employed by any entity that is engaged in the business of mineral 
mining during the period of employment of that employee by the Service.
    (e) Revolving Door.--
            (1) Any work for the industry.--An employee of the Service 
        shall not work for an entity engaged in the business of mineral 
        mining during the 1 year period after the termination of his or 
        her employment with the Service.
            (2) Violation.--Whoever violates paragraph (1) shall be 
        guilty of a felony and punished as provided in section 216 of 
        title 18, United States Code.

                     TITLE II--PROGRAMS OF SERVICE

SEC. 201. SUSPENSION OF ROYALTY-IN-KIND PROGRAM.

    (a) In General.--Notwithstanding any other provision of law, the 
authority of the Secretary to carry out each royalty-in-kind program is 
suspended during the period--
            (1) beginning on the date of enactment of this Act; and
            (2) ending on the date the Secretary certifies to Congress 
        that the Secretary, acting through the Service, has--
                    (A) conducted a comprehensive review to determine 
                if the Service is accurately collecting royalties and 
                reported the results of the review to Congress;
                    (B) conducted a thorough review to ensure that 
                metering equipment properly measures what royalties are 
                owed to the Federal Government and reported the results 
                of the review to Congress;
                    (C) implemented a robust training program for 
                employees of the Service that culminates in a 
                certification signed by an employee that the employee 
                understands the ethics laws (including regulations); 
                and
                    (D) created an ombudsman position that--
                            (i) monitors the progress of the Service in 
                        carrying out the actions described in this 
                        paragraph; and
                            (ii) is appointed by, and reports 
                        exclusively to, the Inspector General of the 
                        Department.
    (b) Application.--Subsection (a) applies to a contract entered into 
on or after the date of enactment of this Act.

SEC. 202. AUDITS.

    (a) Number of Audits.--
            (1) In general.--The Secretary shall ensure that by fiscal 
        year 2009 the Service shall perform each fiscal year not less 
        that 550 audits of oil and gas leases entered into by the 
        Secretary for which payment is made under a royalty-in-kind 
        program.
            (2) Compliance reviews.--For purposes of paragraph (1), a 
        compliance review shall not be considered an audit.
    (b) Standards.--Not later than 120 days after the date of enactment 
of this Act, the Secretary shall promulgate regulations that--
            (1) require that all employees that conduct audits or 
        compliance reviews of oil and gas leases entered into by the 
        Secretary shall meet professional auditor qualifications that 
        are consistent with the latest revision of the Government 
        Auditing Standards issued by the Comptroller General of the 
        United States; and
            (2) ensure that all audits conducted by the Department are 
        performed in accordance with the Standards.

SEC. 203. ANNUAL REPORTS.

    Not later than 1 year after the date of enactment of this Act and 
each year thereafter, the Inspector General of the Department shall 
submit to Congress a report that evaluates--
            (1) the performance of the Secretary in carrying out each 
        royalty-in-kind program; and
            (2) whether the royalty-in-kind program costs or saves 
        taxpayer dollars as compared to receiving revenues in cash.

SEC. 204. PROHIBITION ON USE OF ROYALTY-IN-KIND REVENUES FOR 
              ADMINISTRATIVE COSTS.

    Section 342(b)(5) of the Energy Policy Act of 2005 (42 U.S.C. 
15902(b)(5)) is amended--
            (1) by striking ``Limitation.--'' and all that follows 
        through ``subparagraph (B), the'' in subparagraph (A) and 
        inserting ``Limitation.--The''; and
            (2) by striking subparagraph (B).
Integrity in Offshore Energy Resources Act of 2008 - Prohibits any employee of the Minerals Management Service of the Department of the Interior from: (1) knowingly accepting a gift from an entity engaged in the business of mineral mining or from being employed by such an entity while employed in the Service; and (2) accepting employment from an entity engaged in the business of mineral mining during the one-year period after termination of employment with the Service. Makes violations of such prohibitions a felony. Requires financial disclosure by employees of the Service in positions equivalent to GS-13 or higher.

Suspends the authority of the Secretary of the Interior to carry out royalty-in-kind programs (payment of royalties from oil and gas leases in the form of production rather than cash) until the Secretary certifies that a comprehensive review of such programs has been conducted, implements an ethics training program for employees of the Minerals Management Service, and creates an ombudsman position to monitor the progress of the Service in carrying out reforms. Requires the Secretary to perform at least 550 audits in each fiscal year of oil and gas leases for which payment is made under a royalty-in-kind program.

Amends the Energy Policy Act of 2005 to repeal the authority of the Secretary to pay salaries and other administrative costs related to a royalty-in kind program from royalty-in-kind sales revenues.
A bill to improve the administration of the Minerals Management Service, and for other purposes.