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99–010

" ! SENATE 107th Congress

1st Session

REPORT

2001

107–88

Calendar No. 207

OFFICE OF GOVERNMENT ETHICS

AUTHORIZATION ACT OF 2001

R E P O R T

OF THE

COMMITTEE ON GOVERNMENTAL AFFAIRS

UNITED STATES SENATE

TO ACCOMPANY

S. 1202

TO AMEND THE ETHICS IN GOVERNMENT ACT OF 1978 (5 U.S.C.

APP.) TO EXTEND THE AUTHORIZATION OF APPROPRIATIONS

FOR THE OFFICE OF GOVERNMENT ETHICS THROUGH FISCAL

YEAR 2006

OCTOBER 30, 2001.—Ordered to be printed

(II)

COMMITTEE ON GOVERNMENTAL AFFAIRS

JOSEPH I. LIEBERMAN, Connecticut, Chairman

CARL LEVIN, Michigan

DANIEL K. AKAKA, Hawaii

RICHARD J. DURBIN, Illinois

ROBERT G. TORRICELI, New Jersey

MAX CLELAND, Georgia

THOMAS R. CARPER, Delaware

JEAN CARNAHAN, Missouri

MARK DAYTON, Minnesota

FRED THOMPSON, Tennessee

TED STEVENS, Alaska

SUSAN M. COLLINS, Maine

GEORGE V. VOINOVICH, Ohio

PETE V. DOMENICI, New Mexico

THAD COCHRAN, Mississippi

ROBERT F. BENNETT, Utah

JIM BUNNING, Kentucky

JOYCE A. RECHTSCHAFFEN, Staff Director and Counsel

LAWRENCE B. NOVEY, Counsel

HANNAH S. SISTARE, Minority Staff Director and Counsel

DAN G. BLAIR, Minority Senior Counsel

DARLA D. CASSELL, Chief Clerk

99–010

Calendar No. 207

107TH CONGRESS REPORT

1st Session " ! SENATE 107–88

OFFICE OF GOVERNMENT ETHICS AUTHORIZATION ACT OF

2001

OCTOBER 30, 2001.—Ordered to be printed

Mr. LIEBERMAN, from the Committee on Governmental Affairs,

submitted the following

R E P O R T

[To accompany S. 1202]

The Committee on Governmental Affairs, to whom was referred

the bill (S. 1202) to amend the Ethics in Government Act of 1978

(5 U.S.C. App.) to extend the authorization of appropriations for

the Office of Government Ethics through fiscal year 2006, having

considered the same, reports favorably thereon and recommends

that the bill do pass.

CONTENTS

Page

I. Purpose and Summary ..................................................................................... 1

II. Background and Need for Legislation ............................................................ 1

III. Legislative History ........................................................................................... 4

IV. Regulatory Impact Statement ......................................................................... 5

V. Congressional Budget Office Cost Estimate ................................................... 5

VI. Changes to Existing Law ................................................................................. 6

I. PURPOSE AND SUMMARY

The purpose of S. 1202 is to continue programs that foster high

ethical standards for employees in the Executive Branch by extending the authorization of appropriations for the Office of Government Ethics (OGE) through the end of the 2006 fiscal year.

II. BACKGROUND AND NEED FOR LEGISLATION

OGE was established by Title IV of the Ethics in Government

Act of 1978 (Ethics Act), 5 U.S.C. App., to provide ‘‘overall direction

of executive branch policies related to preventing conflicts of interest on the part of officers and employees of any executive agency.’’

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OGE’s role has subsequently expanded by statute and executive

order. In addition to its programs relating to prevention of conflict

of interest, OGE now provides interpretive guidance, training, and

administrative support on a number of other requirements related

to employee conduct, such as potential misuse of one’s official position and the rules governing gifts between employees. More recently, in light of the corrosive effect of corruption upon certain foreign governments and economies, U.S. foreign-policy agencies have

called upon OGE to provide technical assistance to foreign governments regarding methods for preventing conflict of interest and

other ethics violations as part of broader anti-corruption efforts.

A. CREATION AND PAST AUTHORIZATIONS OF THE OFFICE OF

GOVERNMENT ETHICS

In response to a 1976 General Accounting Office report to Congress identifying a number of problems with the federal government’s ethics system, President Carter submitted draft legislation

in 1977 proposing the creation of OGE. The following year, on October 26, 1978, the Ethics Act was signed into law as Public Law 95–

521. (For a more detailed history of the creation and past authorizations of OGE, see Senate Report No. 106–216, issued by this

Committee on November 5, 1999, regarding S. 1503, 106th Cong.)

OGE was originally established within the Office of Personnel

Management (OPM) and was authorized for five years, through

September 30, 1983. In 1983, OGE was reauthorized for another

five years pursuant to Public Law 98–150. This law extended

OGE’s authorization through September 20, 1988, gave OGE additional powers and responsibilities, and granted it greater independence from the rest of OPM. OGE was again reauthorized in 1988,

this time for six years, through September 30, 1994, by Public Law

100–598. The 1988 law made a number of additional enhancements

in OGE’s authority and established OGE as an independent agency, separate from OPM.

During the period of 1988 to 1994, the executive branch ethics

program and OGE’s responsibilities increased as a result adoption

of the Ethics Reform Act of 1989 (Public Law 101–194), which included extensive ethics reform provisions, and two Executive Orders. Executive Order 12674 (April 12, 1989) required the promulgation of comprehensive Standards of Ethical Conduct for Executive Branch Employees and Executive Order 12834 (January 20,

1993) created new post-employment rules for political appointees.

After a two-year lapse of authorization, in 1996 OGE was reauthorized by Public Law 104–179 for three years, through September 20, 1999. In the 106th Congress, the Committee reported

out S. 1503 on November 3, 1999, to reauthorize OGE for four

years, and the Senate passed S. 1503 on November 19, 1999. The

House of Representatives also passed a four-year reauthorization

bill, H.R. 2904, on November 8, 1999. Neither bill was enacted,

however, so the authorization of appropriations remains lapsed.

During this period, funding for OGE’s activities has continued to

be provided by appropriations legislation enacted for FY 2000, Public Law 106–58, and for FY 2001, Public Law 106–554, and would

be provided for FY 2002 by the conference report on H.R. 2590, H.

Rept. No. 107–253, which was filed October 26, 2001.

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1This description of developments since OGE’s last reauthorization is based largely on briefings and documents provided by OGE to the Committee.

B. DEVELOPMENTS SINCE OGE’S LAST REAUTHORIZATION

The statutes and the basic elements of the ethics program administered by OGE have not changed dramatically since the Office

was last reauthorized in 1996, and OGE has focused on improving

how it provides its ethics services and on evaluating the impact of

the program.1

In the last four years, OGE has expanded its desk officer program, which assigns OGE staff to specific agencies to provide more

direct and consistent services to those agencies. OGE has enhanced

the employee training materials it produces for use by agencies and

has designed new courses for educating agency ethics officials, including those located outside of the Washington, D.C., area. It has

recently redesigned its web site (www.usoge.gov) to make ethics information more easily accessible to ethics officials as well as to the

public. And it developed a CD-ROM containing all of the basic resource and reference materials important to carrying out its program. It also developed the software used in the completion of the

confidential financial disclosure forms filed by more than 250,000

employees in the Executive Branch.

In time for the transition of administrations following the 2000

election, OGE completed the development of software necessary to

complete, save the data on, and print the public financial disclosure

form, the SF 278. This form must be filed by all senior officials in

the Executive Branch, including those individuals who are nominated by the President for Senate-confirmed positions. OGE is required to review and certify the financial disclosure forms of those

nominees. From January 1996 through September 2001, OGE has

reviewed more than 1,600 of these nominee forms, including approximately 460 during the period from January 2001 through September 2001. OGE also reviews certain of the financial disclosure

forms that senior employees file annually and upon termination,

and, from January 1996 through September 2001, OGE reviewed

approximately 5,600 of these annual and termination reports. Furthermore, OGE has continued to provide interpretive guidance on

the criminal conflict of interest statutes and to review and update

its regulations for the Standards of Ethical Conduct.

In 2000, OGE, working with an international consulting firm,

conducted its first survey of Executive Branch employees in order

to begin developing a way to measure the effectiveness of the ethics

program and assess employee perceptions of the ethical culture of

the agencies for which they worked. Key survey findings and recommendations included: (1) employees are generally aware of the

ethics program and are familiar with and use the ethics resources

in their agencies; however, improved communication to employees

may help reduce the number whose needs have not been met; (2)

the frequency of ethics training is related to the perception of a

positive ethical culture; therefore, providing additional ethics training may lead to improved employee perception of the ethical culture and increased employee awareness of an agency’s ethics program; and (3) supervisory and executive leadership attention to

ethics are important factors in creating and maintaining a positive

ethics culture; therefore, efforts to get supervisors and agency leadVerDate 11-MAY-2000 07:14 Nov 01, 2001 Jkt 099010 PO 00000 Frm 00005 Fmt 6659 Sfmt 6602 E:\HR\OC\SR088.XXX pfrm04 PsN: SR088
4

ership to play a more active and visible role in the promotion of

an agency’s ethics programs may be critical to program success.

The survey results also provide a benchmark against which future

program changes may be measured.

Finally, in response to a requirement proposed by this Committee in the Presidential Transition Act of 2000, Public Law 106– 293, OGE conducted a study and issued a ‘‘Report on Improvements to the Financial Disclosure Process for Presidential Nominees.’’ That report led OGE to propose amending the public financial disclosure requirements for Executive Branch officials under

the Ethics in Government Act. OGE Director Amy Comstock testified before the Committee on April 5, 2001 in support of these proposals. OGE’s research also identified potential overlap and redundant questions on the various disclosure forms that must be completed by Presidential nominees to Senate-confirmed positions, and

OGE shared these findings with the Senate committees that consider nominations. OGE has also committed to undertaking a study

of the criminal conflict of interest laws.

Recently, as attention has focused on the important effects of corruption on certain governments and economies outside of the

United States, OGE has been called upon by U.S. foreign policy

agencies to provide technical assistance to other governments regarding the elements of a preventative program as one part of any

government’s overall anti-corruption efforts.

C. OGE’S BUDGET AND STAFFING

Since OGE’s last reauthorization in 1996, its budget and staffing

levels have been as follows:

Fiscal year Funding Authorized

staff levels

1997 ................................................................................................................................................. $8,078,000 87

1998 ................................................................................................................................................. 8,265,000 84

1999 ................................................................................................................................................. 8,492,000 84

2000 ................................................................................................................................................. 9,114,000 84

2001 ................................................................................................................................................. 9,663,000 82

2002 ................................................................................................................................................. 2 10,117,000 82

2 This funding level for FY 2002 would be provided by the conference report on H.R. 2590, H. Rept. No. 107–253, filed October 26, 2001.

D. DURATION OF THE REAUTHORIZATION

S. 1202 would reauthorize OGE’s appropriations through the end

of the 2006 fiscal year. This time span accommodates OGE’s preference that a reauthorization process not occur during the first or

fourth year of Presidential term, when the agency’s resources are

significantly devoted to matters arising from election and transition

activities.

III. LEGISLATIVE HISTORY

S. 1202 was introduced by Senator Lieberman, for himself and

Senator Thompson, on July 19, 2001, and referred to the Committee on Governmental Affairs. Senior staff of OGE made a comprehensive presentation to Committee staff with regard to OGE’s

recently completed and ongoing programs, its future program

plans, and its role in the current transition process. No hearings

were held on the legislation.

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S. 1202 was considered by the Committee at its business meeting

on August 2, 2001, and was ordered reported favorably, without

amendment, by voice vote. Committee members present were: Senators Levin, Akaka, Torricelli, Carper, Dayton, Thompson, Collins,

Cochran, and Lieberman.

IV. REGULATORY IMPACT STATEMENT

Paragraph 11(b)(1) of rule XXVI of the Standing Rules of the

Senate requires that each report accompanying a bill evaluate the

‘‘regulatory impact which would be incurred in carrying out this

bill.’’ Carrying out S. 1202 would have no regulatory impact.

V. CONGRESSIONAL BUDGET COST ESTIMATE

U.S. CONGRESS,

CONGRESSIONAL BUDGET OFFICE,

Washington, DC, August 9, 2001.

Hon. JOSEPH I. LIEBERMAN,

Chairman, Committee on Governmental Affairs,

U.S. Senate, Washington, DC.

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 1202, the Office of Government Ethics Authorization Act of 2001.

If you wish further details on this estimate, we will be pleased

to provide them. The CBO staff contact is Mark Grabowicz.

Sincerely,

BARRY B. ANDERSON

(For Dan L. Crippen, Director).

Enclosure.

S. 1202—Office of Government Ethics Authorization Act of 2001

Summary: S. 1202 would reauthorize the Office of Government

Ethics (OGE) for fiscal years 2002 through 2006. Assuming appropriation of the necessary amounts, CBO estimates that implementing S. 1202 would cost $56 million over the 2002–2006 period.

This estimate assumes adjustments for anticipated inflation. Without such adjustments, we estimate that implementation would cost

$49 million over the 2002–2006 period.

Because the bill would not affect direct spending or receipts, payas-you-go procedures would not apply. S. 1202 contains no intergovernmental or private-sector mandates as defined in the Unfunded

Mandates Reform Act (UMRA) and would not affect the budgets of

state, local, or tribal governments.

Estimated cost to the Federal Government: The estimated budgetary impact of S. 1202 is shown in the following table. For this

estimate, CBO assumes that the necessary amounts will be appropriated by the start of each fiscal year and that outlays will follow

the historical spending pattern of the OGE. Estimated authorization levels for 2002 through 2006 are based on the 2001 appropriation for the OGE, and $10 million. The costs of this legislation fall

within budget function 800 (general government).

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By fiscal year, in millions of dollars—

2001 2002 2003 2004 2005 2006

SPENDING SUBJECT TO APPROPRIATION

OGE Spending Under Current Law

Budget Authority 1 ........................................................................... 10 0 0 0 0 0

Estimated Outlays ........................................................................... 10 1 0 0 0 0

Proposed Changes

Estimated Authorization Level ......................................................... 0 11 11 11 12 12

Estimated Outlays ........................................................................... 0 10 11 11 12 12

OGE Spending Under S. 1202

Estimated Authorization Level 1 ...................................................... 10 11 11 11 12 12

Estimated Outlays ........................................................................... 10 11 11 11 12 12

1 The 2001 level is the amount appropriated for that year.

Pay-as-you-go considerations: None.

Intergovernmental and private-sector impact: S. 1202 contains no

intergovernmental or private-sector mandates as defined in UMRA

and would not affect the budgets of state, local, or tribal governments.

Estimate prepared by: Federal Costs: Mark Grabowicz. Impact

on State, Local, and Tribal Governments: Susan Sieg Tompkins.

Impact on the Private Sector: Patrice Gordon.

Estimate approved by: Robert A. Sunshine, Assistant Director for

Budget Analysis.

VI. CHANGES TO EXISTING LAW

In compliance with paragraph 12 of rule XXVI of the Standing

Rules of the Senate, changes in existing law made by S. 1202 as

reported are shown as follows (existing law proposed to be omitted

is enclosed in brackets, new matter is printed in italic, and existing

law in which no change is proposed is shown in roman):

UNITED STATES CODE

TITLE 5—GOVERNMENT ORGANIZATION

AND EMPLOYEES

* * * * * * *

APPENDIX

ETHICS IN GOVERNMENT ACT OF 1978

* * * * * * *

TITLE IV. OFFICE OF GOVERNMENT ETHICS

* * * * * * *

§ 405. Authorization of appropriations

There are authorized to be appropriated to carry out this title

such sums as may be necessary for each of fiscal years ø1997

through 1999¿ 2002 through 2006.

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