[Federal Register Volume 60, Number 32 (Thursday, February 16, 1995)]
[Proposed Rules]
[Pages 8961-8973]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-3821]



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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 60, No. 32 / Thursday, February 16, 1995 / 
Proposed Rules
[[Page 8961]]

OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 950

RIN 3206-AG50


Solicitation of Federal Civilian and Uniformed Service Personnel 
for Contributions to Private Voluntary Organizations

agency: Office of Personnel Management.

action: Proposed rule.

-----------------------------------------------------------------------

summary: The Office of Personnel Management (OPM) is issuing proposed 
regulations governing the solicitation of Federal civilian and 
uniformed services personnel for contribution to private voluntary 
organizations under the authority of Executive Order 12353 (March 23, 
1982). Private voluntary organizations and OPM's Inspector General have 
indicated a need for clarifying or changing current procedures for 
soliciting Federal employees in the workplace. These regulations 
propose a number of changes to improve procedural operations and 
accountability for the annual charitable solicitation campaign 
conducted by Federal personnel in their Government workplaces and set 
forth ground rules under which charitable organizations may receive 
contributions from Federal personnel through the Combined Federal 
Campaign.

dates: Comments must be submitted on or before April 17, 1995.

addresses: All comments concerning these proposed regulations should be 
addressed to Gerri Mason Hall, Counsel for Extragovernmental Affairs, 
U.S. Office of Personnel Management, 1900 E Street NW., Room 6H28, 
Washington, DC 20415.

for further information contact: Jeffrey C. Lee, Assistant Counsel for 
Extragovernmental Affairs, (202) 606-2564.

supplementary information: These regulations are proposed to implement 
a number of procedural changes to the operations of the Combined 
Federal Campaign (CFC). These proposed changes to the regulations 
include, but are not limited to:
    More clearly defining the scope and meaning of workplace 
solicitations in the Federal government;
    Identification of the circumstances where the Director may 
authorize solicitations of Federal employees in the workplace outside 
of the CFC;
    Clarification of procedural requirements for charitable 
organizations seeking participation in the CFC;
    Expanding local eligibility by defining and enumerating criteria 
for organizations that provide services on a statewide basis;
    Authorizing the use of a ``perpetual'' payroll allotment (pledge 
card) that, once completed, would remain in effect until changed or 
cancelled by the donor-employee;
    Removing all general designation options not required by statute.
    Expanding the solicitation methods and the pool of potential 
donors.
    These proposed regulations are consistent with the restrictions 
placed on OPM by section 618 of the Treasury, Postal Service, and 
General Government Appropriations Act for 1988.

Regulatory Flexibility Act

    I certify that these regulations will not have a significant 
economic impact on a substantial number of small entities because it 
will only effect those charitable organizations that participate in the 
CFC.

Paperwork Reduction Act

    The collection of information requirements in this part have been 
approved by the Office of Management and Budget and assigned OMB 
control number 3206-0131.

List of Subjects in 5 CFR Part 950

    Administrative practice and procedures, Charitable contribution, 
Government employee, Military personnel, Nonprofit organizations, 
Reporting and recordkeeping requirements.

Office of Personnel Management.
Lorraine A. Green,
Deputy Director.

    Accordingly, OPM proposes to revise 5 CFR part 950 as follows:

PART 950--SOLICITATION OF FEDERAL CIVILIAN AND UNIFORMED SERVICE 
PERSONNEL FOR CONTRIBUTIONS TO PRIVATE VOLUNTARY ORGANIZATIONS

Subpart A--General Provisions

Sec.
950.101  Definitions.
950.102  Scope of the Combined Federal Campaign.
950.103  Establishing a local campaign.
950.104  Local Federal Coordinating Committee responsibilities.
950.105  Principal Combined Fund Organization (PCFO) 
responsibilities.
950.106  PCFO expense recovery.
950.107  Lack of a qualified PCFO.
950.108  Preventing coercive activity.
950.109  Avoidance of conflict of interest.
950.110  Prohibited discrimination.

Subpart B--Eligibility Provisions

950.201  National list eligibility.
950.202  National list eligibility requirements.
950.203  Public accountability standards.
950.204  Local list eligibility.
950.205  Appeals.

Subpart C--Federations

950.301  National federations eligibility.
950.302  Responsibilities of national federations.
950.303  Local federations eligibility.
950.304  Responsibilities of local federations.

Subpart D--Campaign Materials

950.401  Campaign and publicity materials.
950.402  Pledge card.
950.403  Penalties.

Subpart E--Distribution of Undesignated Funds

950.501  Applicability.
950.502  Distribution of undesignated funds.
950.503  Review by the Director.

Subpart F--Miscellaneous Provisions

950.601  Release of contributor names.
950.602  Solicitation method.
950.603  Sanctions.
950.604  Records retention.

Subpart G--DoD Overseas Campaign

950.701  DoD overseas campaign.

Subpart H--CFC Timetable

950.801  Campaign schedule.

Subpart I--Payroll Withholding

950.901  Payroll allotment.

    Authority: E.O. 12353 (March 23, 1982), 47 FR 12785 (March 25, 
1982). 3 CFR 1982 Comp., p. 139. E.O. 12404 (February 10, 1983), 48 
FR 6685 (February 15, 1983), Pub. L. 100-202, and Pub. L. 102-393 (5 
U.S.C. 1101 Note). [[Page 8962]] 

Subpart A--General Provisions


Sec. 950.101   Definitions.

    Administrative Expenses, PCFO Expenses, Campaign Expenses, or CFC 
Expenses means all documented expenses identified in the PCFO 
application relating to the conduct of a local CFC and approved by the 
LFCC in accordance with these regulations.
    Campaign Year means the calendar year in which Federal employees 
are solicited for contributions to the Combined Federal Campaign.
    Combined Federal Campaign or Campaign or CFC means the charitable 
fundraising program established and administered by the Director of the 
Office of Personnel Management (OPM) pursuant to Executive Order No. 
12353, as amended by Executive Order No. 12404, and all subsidiary 
units of such program.
    Designated Funds means those contributions which the contributor 
has designated to a specific charitable organization(s), federation(s), 
or general option(s).
    Director means the Director of the Office of Personnel Management.
    Domestic Area means the several United States, the District of 
Columbia, the Commonwealth of Puerto Rico, and the United States Virgin 
Islands.
    Employee means any person employed by the Government of the United 
States or any branch, unit, or instrumentality thereof, including 
persons in the civil service, uniformed service, foreign service, and 
the postal service.
    Federation or Federated Group means a group of voluntary charitable 
human health and welfare organizations created to supply common 
fundraising, administrative, and management services to its constituent 
members.
    International General Designation Option means that the donor 
wishes that his or her gift be distributed to all of the international 
organizations listed in the International Section of the campaign 
brochure in the same proportion as all of the international 
organizations received designations in the local CFC. This option will 
have the code IIII.
    International Organization means a charitable organization that 
provides services either exclusively or in a substantial preponderance 
in the overseas area or primarily on behalf of non-U.S. citizens in the 
overseas area.
    Local Federal Coordinating Committee or LFCC means the group of 
Federal officials designated by the Director to conduct the CFC in a 
particular community.
    Organization or Charitable Organization means a private, non-
profit, philanthropic, human health and welfare organization.
    Overseas Area means the Department of Defense (DoD) Overseas 
Campaign which includes all areas other than those included in the 
domestic area.
    Principal Combined Fund Organization or PCFO means the federated 
group or combination of groups, or a charitable organization selected 
by the LFCC to administer the local campaign under the direction and 
control of the LFCC and the Director.
    Solicitation means any action requesting money, either by cash, 
check or payroll deduction, on behalf of charitable organizations.
    Undesignated Funds means those contributions which the contributor 
has not designated to a specific charitable organization(s), 
federation(s), or the International General Designation Option.


Sec. 950.102  Scope of the Combined Federal Campaign.

    (a) The CFC is the only authorized charitable fundraising drive in 
the Federal workplace. A campaign may be conducted during a 6 week 
period, as determined by the LFCC, from September 1 through December 15 
at every Federal agency in the campaign community in accordance with 
these regulations. Except as provided in this section, no other 
solicitation on behalf of charitable organizations may be conducted in 
the Federal workplace. Upon written request, the Director may grant 
permission for solicitations of Federal employees in support of victims 
of cases of emergencies and disasters. Emergencies and disasters are 
defined as any hurricane, tornado storm, flood, high water, wind-driven 
water, tidal wave, tsunami, earthquake, volcanic eruption, landslide, 
mudslide, snowstorm, drought, fire, explosion, or other catastrophe in 
any part of the world. No such permission will be granted for such 
solicitations during the period September 1 through December 15.
    (b) These regulations do not apply to the collection of gifts-in-
kind, such as food, clothing and toys, or to the solicitation of 
Federal employees outside of the Federal workplace as defined by the 
applicable Agency Head consistent with General Services Administration 
regulations 41 CFR 101-20.308, government ethics regulations 5 CFR part 
2635, and any other applicable laws and/or regulations.
    (c) The Director exercises general supervision over all operations 
of the CFC, and takes all necessary steps to ensure the achievement of 
campaign objectives. Any disputes relating to the interpretation or 
implementation of this part may be submitted to the Director for 
resolution. The decisions and rulings of the Director are final for 
administrative purposes.
    (d) Heads of departments or agencies may establish policies and 
procedures applicable to solicitations conducted by organizations 
composed of civilian employees or members of the uniformed services 
among their own members for organizational support or for the benefit 
of welfare funds for their members. Such solicitations are not subject 
to these regulations, and therefore do not require permission of the 
Director.


Sec. 950.103  Establishing a local campaign.

    (a) The Director establishes and maintains the official list of 
local campaigns and the geographical area each covers. There is no 
prerequisite regarding the federal employee population needed to 
establish or maintain a CFC. However, rather than establishing or 
maintaining small campaigns, OPM encourages mergers and expansions of 
campaigns to promote efficiency and economy.
    (b) The Director establishes an LFCC to govern the conduct of the 
local CFC. The LFCC will, whenever possible, be comprised of members of 
local Federal inter-agency organizations, such as Federal Executive 
Boards, Federal Executive Associations, Federal Business Associations 
or, in the absence of such organizations, self-organized associations 
of local Federal officials. These groups will include local Federal 
agency heads or their representatives. It will also include, wherever 
possible, representatives of employee unions and other employee groups. 
The LFCC Chair should be rotated among its members. For continuity, 
each LFCC should appoint a Vice Chair who would be expected to serve as 
the Chair in the following year.
    (c) The agency head to each Federal installation within a campaign 
area shall:
    (1) Become familiar with all CFC regulations,
    (2) Cooperate with the representatives of the LFCC and PCFO in 
organizing and conducting the campaign,
    (3) Initiate official campaigns within their offices or 
installations and provide support for the campaign, and
    (4) Assure the campaign is conducted in accordance with these 
regulations.
    (d) Once a campaign has been established, agency heads may not 
discontinue solicitation of Federal employees within their organization 
without the written approval of the Director. [[Page 8963]] 
    (e) Any change in the geographical boundaries of local campaigns 
may be made only upon the express written permission of the Director.
    (f) Each year the LFCC must establish the 6 week time period to 
solicit employees. Each campaign should not be conducted for more than 
a 6 week period. However, in unusual circumstances the LFCC may extend 
the campaign as local conditions require. The solicitation may not 
begin before September 1 and in no event will it extend beyond December 
15 of each year.
    (g) Current Federal civilian and active duty military employees may 
be solicited for contributions using payroll deduction, checks, money 
orders or cash. Contractor personnel, credit union employees and other 
persons employed on Federal premises may make single contributions to 
the CFC through check or money order. Retired Federal employees may 
also make single contributions to the CFC through check or money order.
    (h) A Federal employee whose official duty station is outside the 
geographic boundaries of an established CFC may not be solicited in 
that CFC. A Federal employee may participate in a particular CFC only 
if that employee's official duty station is located within the 
geographic boundaries of that CFC.


Sec. 950.104  Local Federal Coordinating Committee responsibilities.

    (a) All members of the LFCC should develop an understanding of 
campaign regulations and procedures. The LFCC is the central point of 
information regarding the CFC among Federal employees.
    (b) The responsibilities of the LFCC include, but are not limited 
to, the following:
    (1) Maintaining minutes of LFCC meetings and responding promptly to 
any request for information for the Director.
    (2) Naming a campaign chairperson and notifying the Director when 
the chairperson changes.
    (3) Determining the eligibility of local organizations that apply 
to participate in the local campaign. This is the exclusive 
responsibility of the LFCC and may not be delegated to the PCFO.
    (4) Ensuring that the list of charities found by the Director to be 
nationally eligible to participate in all local campaigns is reproduced 
in the local brochure in accordance with these regulations.
    (5) Ensuring that the local brochure and pledge card are produced 
in accordance with these regulations and instructions for the Director.
    (6) Encouraging local Federal agencies to appoint loaned executives 
to assist in the campaign. Federal agency heads are encouraged to grant 
administrative leave to all loaned executives appointed to assist in 
the conduct of the CFC. Federal loaned executives are prohibited from 
working on non-CFC fundraising activities.
    (7) Establishing a thorough network of employee keyworkers and 
volunteers; and participating in interagency briefing sessions and 
kick-off meetings.
    (8) Ensuring that, to the extent reasonably possible, every 
employee is given the opportunity to participate in the CFC, and 
ensuring employee designations are honored.
    (9) Ensuring that the PCFO includes in keyworker training 
instructions to encourage employees to designate the charitable 
organizations they wish to receive their donations and specific 
information on how general designation monies are distributed.
    (10) Ensuring that contributions are distributed in accordance with 
the method described in these regulations.
    (11) Ensuring that no employee is coerced in any way to participate 
in the campaign.
    (12) Bringing allegations of coercion to the attention of the 
Director and the employee's agency and providing a mechanism to review 
employee complaints of undue pressure and coercion in Federal 
fundraising. Federal agencies shall provide procedures and assign 
responsibility for the investigation of such complaints. Personnel 
offices should be responsible for information employees of the proper 
channels for pursuing such complaints.
    (13) Notifying the Director of any other significant problems or 
controversies concerning the campaign that the LFCC can not resolve by 
applying these regulations. The LFCC must abide by the Director's 
decisions on all matters concerning the campaign.
    (14) Ensuring the PCFO selected or retained does not use the 
services of consulting firms, advertising firms or similar business 
organizations to perform the policy-making or decision-making functions 
in the CFC. A PCFO may, however, contract with entities or individuals 
such as banks, accountants, lawyers, and other vendors of goods and/or 
services to assist in accomplishing its ministerial tasks.
    (15) Ensuring that the activities and functions required of the 
PCFO are kept separate from any non-CFC operations of the organization. 
The LFCC must verify that the PCFO keeps and maintains CFC financial 
records and interest bearing bank accounts separate from the PCFO's 
non-CFC financial records and bank accounts.
    (16) Monitoring the work of the PCFO, and inspecting closely the 
annual audit required of the PCFO pursuant to Sec. 950.105(d)(9) for 
compliance with these regulations.
    (17) Authorizing to the PCFO the administrative fee described in 
Sec. 950.106(d) and reimbursement of only those campaign expenses that 
are legitimate CFC costs and are adequately documented. Total 
documented expenses may not exceed the approved campaign budget by more 
than 10 percent.
    (c) The LFCC must annually solicit applications for the PCFO via 
public notice no later than February 1 of each calendar year. Costs 
incurred in providing the public notice should be added to the PCFO 
budget for the current campaign year as an administrative cost. The 
LFCC shall select a PCFO to act as its fiscal agent and campaign 
coordinator on the basis of presentations made to the local committee 
as described in Sec. 950.105. The LFCC shall consider the efficiency 
and effectiveness of the campaign as the primary factors in selecting a 
PCFO.
    (d) A federated group(s) or charitable organization may be barred 
from serving as PCFO for 1 year if found by the Director to have 
violated these regulations. A federated group(s) or charitable 
organization serving as PCFO will be notified of the Director's intent 
to bar and have an opportunity to submit written comments prior to its 
becoming effective. The Director's decision as to debarment shall be 
communicated in writing to the LFCC and PCFO, and the LFCC shall not 
consider an application from such group(s) or organization to serve as 
the PCFO during terms of debarment.


Sec. 950.105  Principal Combined Fund Organization (PCFO) 
responsibilities.

    (a) Only federations, charitable organizations or combinations 
thereof may serve as the PCFO.
    (b) The primary goal of the PCFO is to conduct an effective and 
efficient campaign in a fair and even-handed manner aimed at collecting 
the greatest amount of charitable contributions possible. Therefore, 
PCFO's should afford federated groups and agencies with representatives 
in the local campaign area adequate opportunity to offer suggestions 
relating to the operation of the campaign, printed campaign material, 
and training. If requested in writing to either the LFCC or PCFO, 
federated groups and agencies must be given the opportunity to attend 
all campaign meetings, kick-off events, [[Page 8964]] and training 
sessions. The PCFO must provide representatives of federated groups, 
agencies and the general public the opportunity to review at the PCFO 
office all reports, budgets, audits, training materials, and other 
records pertaining to the CFC.
    (c) Any federation, charitable organization or combinations thereof 
wishing to be selected for the PCFO must submit to the LFCC no later 
than March 1 of each year an application that includes:
    (1) A written campaign plan sufficient in detail to allow the LFCC 
to determine if the applicant could administer an efficient and 
effective CFC. The campaign plan must include a CFC budget that details 
all estimated costs required to operate the CFC. The budget may not be 
based on the percentage of funds raised in the local campaign.
    (2) A statement signed by the applicant's local director or 
equivalent pledging to:
    (i) administer the CFC fairly and equitably,
    (ii) conduct campaign operations, such as training, kick-off and 
other events, and fiscal operations, such as banking, auditing, 
reporting and distribution separate from the applicant's non-CFC 
operations, and
    (iii) abide by the directions, decisions, and supervision of the 
LFCC and/or Director.
    (3) A statement signed by the applicant's local director or 
equivalent acknowledging the applicant is subject to the provisions of 
Sec. 950.403 and Sec. 950.603.
    (d) The specific responsibilities of the PCFO include but are not 
limited to:
    (1) Honoring employee designations.
    (2) Helping to ensure no employee is coerced in any way regarding 
participation in the campaign and that allegations of coercion are 
brought to the attention of the appropriate Federal officials.
    (3) Training agency loaned executives, coordinators, and keyworkers 
in the methods of non-coercive solicitation. This training must be 
completely separate from training given for other types of charitable 
campaign drives. Additionally, keyworkers should be trained to check to 
ensure the pledge card is legible on each copy, verify arithmetical 
calculations, and ensure the block on the pledge card concerning the 
release of the employee's name and address is completed fully.
    (4) Ensuring that no employee is questioned in any way as to his or 
her designation or its amount except by keyworkers in accord with 
paragraph (d)(3) of this section.
    (5) Preparing pledge cards and brochures that are consistent with 
these regulations and instructions by the Director.
    (6) Honoring the request of employees who indicate on the pledge 
card that their names not be released to the organization(s) that they 
designate.
    (7) Maintaining a detailed schedule of its actual CFC 
administrative expenses with, to the extent possible, itemized receipts 
for the expenses. The expense schedule must be in a format that can be 
reconciled to the PCFO's budget submitted in accordance with paragraph 
(c)(1) of this section
    (8) Keeping and maintaining CFC financial records and interest 
bearing bank accounts separate from the PCFO's internal organizational 
financial records and bank accounts. Interest earned on all CFC 
accounts must be distributed in the same manner as undesignated funds 
pursuant to Sec. 950.502. All financial records and bank accounts must 
be kept in accordance with generally accepted accounting principles.
    (9) Submitting to the LFCC an audit of collections and 
disbursements for each campaign managed no later than June 15 of the 
year in which the last disbursement is made. For example, for the 1994 
CFC the audit of the 1994 campaign must be submitted to the LFCC no 
later than June 15, 1996. The audit must be performed by an independent 
certified public accountant in accordance with generally accepted 
auditing standards.
    (10) Absorbing the cost of any reprinting of campaign materials due 
to its noncompliance with these regulations, embezzlement, or loss of 
funds. A PCFO must also absorb campaign costs exceeding 10 percent of 
the approved budget.
    (11) Designing and implementing CFC awards programs which are 
accessible to all employees and which reflect the Government's 
commitment to non-coercion. Awards to Federal agencies or employees by 
individual federations or organizations for CFC accomplishments is 
prohibited.
    (12) Communicating to all local applicants the date, time, and 
place of the open public meeting where the LFCC will announce 
eligibility decisions.
    (13) Producing any documents or information requested by the LFCC 
and/or the Director within 10 calendar days of the receipt of that 
request.
    (14) Responding in a timely and appropriate manner to reasonable 
inquiries from participating organizations.


Sec. 950.106  PCFO expense recovery.

    (a) The PCFO shall recover from the gross receipts of the campaign 
its expenses, approved by the LFCC, reflecting the actual costs of 
administering the local campaign. The amount recovered for campaign 
expenses shall not exceed 10 percent of the estimated budget submitted 
pursuant to Sec. 950.105(c)(1) unless approved by the Director.
    (b) The PCFO may only recover campaign expenses from receipts 
collected for that campaign year. Expenses incurred preparing for and 
conducting the CFC in the fall cannot be recovered from receipts 
collected in the previous year's campaign. The PCFO may absorb the 
costs associated with conducting the campaign from its own funds and be 
reimbursed, or obtain a commercial loan to pay for costs associated 
with conducting the campaign. If the commercial loan option is used, 
the amount of a reasonable rate of interest is an allowable campaign 
expense, subject to the approval of the LFCC when the PCFO budget is 
submitted.
    (c) The campaign expenses will be shared proportionately by all the 
recipient organizations reflecting their percentage share of gross 
campaign receipts.
    (d) In addition to recovering campaign expenses, PCFO's shall also 
collect a fee of 15 percent of the undesignated funds in each local 
campaign for performing the functions of PCFO.


Sec. 950.107  Lack of a qualified PCFO.

    There is no authority in statute or regulation for an LFCC or any 
Federal official or employee to assume the duties and responsibilities 
of the PCFO. In the event that there is no qualified PCFO, the LFCC 
Chairman will promptly inform the Director in writing. The Director 
will assist the LFCC in merging the campaign with an adjacent campaign 
that has a qualified PCFO or identifying an eligible organization to 
function as the campaign's PCFO. If the LFCC's of the adjacent 
campaigns elect not to merge and a qualified PCFO cannot be found, the 
local CFC will be canceled. No workplace solicitation of any Federal 
employee in the campaign area is authorized and payroll allotments 
cannot be accepted and honored during the duration of the cancellation 
of the CFC.


Sec. 950.108  Preventing coercive activity.

    True voluntary giving is fundamental to Federal fundraising 
activities. Actions that do not allow free choices or create the 
appearance employees do not have a free choice to give or not to 
[[Page 8965]] give, or to publicize their gifts or to keep them 
confidential, are contrary to Federal fundraising policy. Activities 
contrary to the non-coercive intent of Federal fundraising policy are 
not permitted in campaigns. They include, but are not limited to:
    (a) Solicitation of employees by their supervisor or by any 
individual in their supervisory chain of command. This does not 
prohibit the head of an agency to perform the usual activities 
associated with the campaign kick-off and to demonstrate his or her 
support of the CFC in employee newsletters or other routine 
communications with the Federal employees.
    (b) Supervisory inquiries about whether an employee chose to 
participate or not to participate or the amount of an employee's 
donation. Supervisors may be given nothing more than summary 
information about the major units that they supervise.
    (c) Setting of 100 percent participation goals.
    (d) Establishing personal dollar goals and quotas.
    (e) Developing and using lists of non-contributors.
    (f) Providing and using contributor lists for purposes other than 
the routine collection and forwarding of contributions and allotments, 
and as allowed under Sec. 950.601.
    (g) Using as a factor in a supervisor's performance appraisal the 
results of the solicitation in the supervisor's unit or organization.


Sec. 950.109  Avoidance of conflict of interest.

    Any Federal employee who serves on the LFCC, on the eligibility 
committee, or as a Federal agency fundraising program coordinator, must 
not participate in any decisions where, because of membership on the 
board or other affiliation with a charitable organizations, there could 
be or appear to be a conflict of interest under any statutes, Executive 
order, or applicable agency standards of conduct. Under no 
circumstances may an LFCC member affiliated with an organization 
applying for inclusion on the local list, participate in the 
eligibility determinations.


Sec. 950.110  Prohibited discrimination.

    Discrimination for or against any individual or group on account of 
race, color, religion, sex, national origin, age, handicap, or 
political affiliation is prohibited in all aspects of the management 
and the execution of the CFC. Nothing herein denies eligibility to any 
organization, which is otherwise eligible under this part to 
participate in the CFC, merely because such organization is organized 
by, on behalf of, or to serve persons of a particular race, color, 
religion, sex, national origin, age, or handicap.

Subpart B--Eligibility Provisions


Sec. 950.201  National List eligibility.

    (a) The Director shall annually:
    (1) Determine the timetable and other procedures regarding 
application for inclusion on the national list,
    (2) Determine which organizations among those that apply qualify to 
be part of the national list and then provide the national list of 
qualified organizations to all local campaigns.
    (b) The national list shall be reproduced in all local brochures in 
accordance with these regulations. The list will include each 
organization's national list number code. These number codes must be 
faithfully reproduced in the local brochures.
    (c) An organization on the national list may elect to be removed 
from the national list and have its local affiliate or subunit listed 
on the local list of organizations in its stead. For the local 
affiliate or subunit to be listed in lieu of the organization on the 
national list, the following procedures must be followed:
    (1) The organization must send a letter to the local affiliate or 
subunit in that particular CFC waiving its listing on the national list 
so that is eligible local affiliate or subunit on the local list of 
organizations will appear as that organization's sole list in the CFC 
Brochure.
    (2) The local affiliate or subunit will include in its application 
to the LFCC a copy of the letter authorizing the removal of the 
organization from the national list as well as all the required 
materials for completing a local organization application.
    (3) Upon finding the local organization eligible, the waiver letter 
from the organization on the national list authorizes the LFCC to 
delete that organization from the national list.


Sec. 950.202  National List of eligibility requirements.

    All organizations seeking national list eligibility must:
    (a) Certify that it provides or conducts real services, benefits, 
assistance, or program activities, in 15 or more different states or a 
foreign country over the 3 year period immediately preceding the start 
of the year involved. This requirement cannot be met on the sole basis 
of services provided through an ``800'' telephone number or by sending 
materials via the U.S. Mails or a combination thereof. In addition, 
this requirement cannot be met by providing a service, benefit, 
assistance or program activity in only one state to recipients who live 
in a different state. A schedule listing those states (minimum 15) or 
the foreign countries (minimum 1) where the program activities have 
been provided and a detailed description of the activities in each 
state or foreign country must be included with the application. Clear 
evidence must be submitted that the services, benefits, assistance or 
activities were provided in each state or foreign country.
    (b) Certify that it is recognized by the Internal Revenue Service 
as tax-exempt under 26 U.S.C. 501(c)(3) and to which contributions are 
tax-deductible pursuant to 26 U.S.C. 170. A copy of the letter from the 
Internal Revenue Service granting tax-exempt status under the Internal 
Revenue Code, 26 U.S.C. 501(c)(3) must be included with the 
application.
    (c) Certify that the organization has no expenses connected with 
lobbying and attempts to influence voting or legislation at the local, 
State, or Federal level or alternatively, that those expenses would 
classify the organization as a tax-exempt organization under 26 U.S.C. 
501(h).


Sec. 950.203  Public accountability standards.

    (a) To insure organizations wishing to solicit donations from 
Federal employees in the workplace are portraying accurately their 
programs and benefits, several standards and certifications must be met 
annually by each organization seeking national list eligibility. Each 
organization wishing to participate must:
    (1) Certify that the organization is a human health and welfare 
organization providing services, benefits, or assistance to, or 
conducting activities affecting, human health and welfare. The 
organization's application must provide documentation describing the 
human health and welfare benefits provided by the organization within 
the previous year.
    (2) Certify that it accounts for its funds in accordance with 
generally accepted accounting principles and that an audit of the 
organization's fiscal operations is completed annually by an 
independent certified public accountant in accordance with generally 
accepted auditing standards. Such audit must show expenses by function. 
A copy of the organization's most recent annual audit must be included 
with the application. The audit must cover the fiscal year ending not 
more than 18 months prior to the January of the campaign year to which 
the organization is applying. For example, the audit included in the 
1994 [[Page 8966]] application must cover the fiscal period ending on 
or after June 30, 1992.
    (3) Provide a completed copy of the organization's IRS Form 990, 
including signature, with the application regardless of whether or not 
the IRS requires the organization to file this form. IRS Forms 990EZ, 
990PF, and comparable forms are not acceptable substitutes. The IRS 
Form 990 and audit must cover the same fiscal period and, if revenue 
and expenses on the two documents differ, these amounts must be 
reconciled in an accompanying signed statement by the certified public 
accountant who completed the audit.
    (4) Provide a computation of the organization's percentage of total 
support and revenue spent on administration and fundraising. This 
percentage shall be computed from information on the IRS Form 990, 
submitted pursuant to Sec. 950.203(a)(3), by adding the amount spent on 
``management and general'' (line 14) to ``fundraising'' (line 15) and 
then dividing the sum by ``total revenue'' (line 12).
    (i) If an organization's administrative and fundraising expenses 
exceed 25 percent of its total support and revenue, it must certify 
that its actual expenses for administration and fundraising are 
reasonable due to special circumstances. It must provide an explanation 
with its application and also include a formal plan to reduce these 
expenses below 25 percent.
    (i) The Director may reject any application from an organization 
with fundraising and administrative expenses in excess of 25 percent of 
total support and revenue, unless the organization demonstrates to the 
satisfaction of the Director that its actual expenses for those 
purposes and its plan to reduce them are reasonable under the 
circumstances. Failure to reduce the expenses to the 25 percent level 
within one application year will render the organization ineligible for 
the succeeding campaign.
    (5) Certify that the organization is directed by an active and 
responsible governing body whose members have no material conflict of 
interest and, a majority of which serve without compensation. A list of 
the organization's Board of Directors and a description of each 
Directors' participation in the conduct of the organization's affairs, 
such as official positions and committee memberships, must be included 
with the application.
    (6) Certify that the organization's fundraising practices protect 
against unauthorized use of its CFC contributor lists as described in 
Sec. 950.601(d).
    (7) Certify that its publicity and promotional activities are based 
upon its actual program and operations, are truthful and non-deceptive, 
and make no exaggerated or misleading claims.
    (8) Certify that contributions are effectively used for the 
announced purposes of the charitable organization.
    (9) Certify under which governmental entity the charitable 
organization is chartered, incorporated or organized (congressionally 
chartered or the state in which it is registered).
    (10) Certify that the organization has received no more than 80 
percent of its total support and revenues from government sources as 
computed by dividing line 1c by line 12 from the IRS Form 990 submitted 
pursuant to Sec. 950.203(a)(3).
    (11) Certify that the organization prepares and makes available to 
the public upon request an annual report that includes a full 
description of the orgranization's activities and supporting services 
and identifies its directors and chief administrative personnel. A copy 
of the organization's annual report must be included with the 
application. The annual report must cover the fiscal year ending not 
more than 18 months prior to January of the campaign year to which the 
organization is applying. A more frequently published document, such as 
a quarterly newsletter, may be used to meet this requirement provided 
that such document is available to the general public upon request and 
describes the organization's activities and supporting services and 
identifies its directors and chief administrative personnel.
    (12) Provide a statement that the certifying official is authorized 
by the organization to certify and affirm all statements required for 
inclusion on the national list.
    (13) Provide a statement in 25 words or less describing the program 
activities of the charitable organization. The 25-word statement need 
not include the organization's name. In addition, organizations must 
provide a telephone number, dedicated solely for the organization's 
use, through which the donors may receive further information about the 
organization. Except as provided in Sec. 950.401(k), this information 
will be included in the campaign brochure listing of agencies along 
with the organization's administrative and fundraising percentage 
computed pursuant to Sec. 950.203(a)(3).
    (b) The Director shall review these applications for accuracy, 
completeness, and compliance with these regulations. Failure to supply 
any of this information may be judged a failure to comply with the 
requirements of public accountability, and the charitable organization 
may be ruled ineligible for inclusion on the national list.
    (c) The Director may request such additional information as the 
Director deems necessary to complete these reviews. An organization 
that fails to comply with such requests within 10 calendar days from 
receipt of the request may be judged ineligible.
    (d) The required certifications and documentation must have been 
completed and submitted prior to the application filing deadline. 
Applications received that are incomplete may not be perfected during 
the appeal process described in Sec. 950.205.
    (e) The Director may waive any of these standards and 
certifications upon a showing of extenuating circumstances.


Sec. 950.204  Local list eligibility.

    (a) The LFCC shall establish an annual application process 
consistent with these regulations for organizations that wish to be 
listed in the local brochure.
    (b) The requirements for an organization to be listed in the local 
brochure shall include the following:
    (1) An organization must demonstrate to the satisfaction of the 
LFCC, that it has a substantial local presence in the geographical area 
covered by the local campaign, a substantial local presence in the 
geographical area covered by an adjacent local campaign, or substantial 
statewide presence.
    (i) Substantial local presence is defined as a staffed facility, 
office or portion of a residence dedicated exclusively to that 
organization, available to members of the public seeking its services 
or benefits. The facility must be open at least 15 hours a week and 
have a telephone dedicated exclusively to the organization. The office 
may be staffed by volunteers. Substantial local presence cannot be met 
on the basis of services provided solely through an 800 telephone 
number or the U.S. Mails or a combination thereof.
    (ii) Substantial statewide presence is defined as providing or 
conducting real services, benefits, assistance or program activities 
covering 30 percent of a state's geographic boundaries or providing or 
conducting real services, benefits, assistance or program activities 
affecting 30 percent of a state's population. Substantial statewide 
presence cannot be met on the basis of services provided solely through 
an 800 telephone number or the U.S. Mails or a combination thereof. 
[[Page 8967]] 
    (2) An organization seeking local eligibility also must meet all 
requirements for national list eligibility in Sec. 950.202 and 
Sec. 950.203, with the following two exceptions:
    (i) Local charitable organizations are not required to have 
provided services or benefits in 15 states or a foreign country over 
the prior three years,
    (ii) Local charitable organizations with annual revenue less than 
$100,000 are not required to be audited in accordance with generally 
accepted auditing standards and, hence, are not required to submit an 
audit report. Annual revenue is determined by line 12 of the IRS Form 
990 covering the organization's most recent fiscal year ending not more 
than 18 months prior to the January of the campaign year to which the 
organization is applying.
    (3) An organization seeking local eligibility based upon a 
substantial statewide presence, need only submit a complete application 
to the LFCC of the largest campaign in the state, as determined by OPM. 
OPM will annually publish a list of the largest campaigns in each 
state. The decision of the aforementioned LFCC, or OPM in the event of 
an appeal, is binding upon all other campaigns in the state. The 
applicant organization must forward a copy of the LFCC's decision to 
any other campaigns in which it would like to participate as a 
statewide organization.
    (c) Family support and youth activities certified by the commander 
of a military installation as meeting the eligibility criteria 
contained in Sec. 950.204(d) may appear on the list of local 
organizations and be supported from CFC funds. Family support and youth 
activities may not participate in the CFC as a member of a federation.
    (d) A family support and youth activity must:
    (1) Be a nonprofit, tax-exempt organization that provides family 
service programs or youth activity programs to personnel in the 
Command. The activity must not receive a majority of its financial 
support from appropriated funds.
    (2) Have a high degree of integrity and responsibility in the 
conduct of their affairs. Contributions received must be used 
effectively for the announced purposes of the organization.
    (3) Be directed by the base Non-Appropriated Fund Council or an 
active voluntary board of directors which serves without compensation 
and holds regular meetings.
    (4) Conduct its fiscal operations in accordance with a detailed 
annual budget, prepared and approved at the beginning of the fiscal 
year. Any significant variations from the approved budget must have 
prior authorization from the Non-Appropriated Fund Council or the 
directors. The family support and youth activities must have accounting 
procedures acceptable to an installation auditor and the inspector 
general.
    (5) Have a policy and practice of nondiscrimination on the basis of 
race, color, religion, sex or national origin applicable to persons 
served by the organization.
    (6) Prepare an annual report which includes a full description of 
the organization's activities and accomplishments. These reports must 
be made available to the public upon request.
    (e) Within 15 business days after the closing date of the 
application period, the LFCC shall communicate its eligibility 
decisions at an open public meeting. The open public meeting date, 
place, and time must be communicated to local applicant organizations 
during the application process and in the public notice section of 
principal local newspaper(s). The open public meeting is the only 
notification local organizations will receive regarding their original 
applications. At the meeting, LFCC's must provide written explanations 
to an organization for its denial of its application and the procedures 
and deadline for appealing the decision. LFCC's may authorize PCFO's to 
release eligibility determinations to applicant organizations via 
telephone, after the open public meeting. This has no affect on the 
deadline for LFCC's to receive local appeals. Applicants denied 
eligibility may appeal in accordance with Sec. 950.205.
    (f) No LFCC may print the campaign brochure while there are appeals 
of eligibility decisions from their campaign pending with the Director. 
LFCC's are obligated to check with OPM 21 calendar days after the 
mailing of the local appeal decision as to whether the Director is on 
notice of a pending timely appeal.


Sec. 950.205  Appeals.

    (a) Organizations who apply and are denied eligibility for 
inclusion on the national list will be notified of the Director`s 
decision by registered or certified mail of the U.S. Postal Service. 
Organizations may appeal the Director's decision by submitting a 
written request to reconsider the denial to the Director. This request 
must be received within 10 business days from the date of receipt of 
the Director's decision to deny eligibility and shall be limited to 
those facts justifying the reversal of the original decision. Petitions 
for reconsideration may not be used to supplement applications that had 
missing or outdated documents, and any such documents submitted with 
the petition will not be considered.
    (b) Applicants denied listing in the local brochure must first 
appeal in writing to the LFCC to reconsider its original decision. Such 
an appeal must be received by the LFCC within the 7 business days from 
the date of the open public meeting announcing local eligibility 
decisions. The LFCC must consider all timely appeals and notify the 
appealing organization within a reasonable time period, not to exceed 
22 business days from the date of the open public meeting. Denial of 
the appeal by the LFCC must be sent via U.S. Postal Service certified 
or registered mail with a return receipt (PS Form 3811). Approval of 
local appeals may be sent via U.S. Postal Service regular first class 
mail.
    (c) A local applicant which is unsuccessful in its appeal to the 
LFCC may appeal to the Director. All appeals must:
    (1) Be in writing;
    (2) Be received by the Director within 10 business days of the date 
of receipt of the letter from the LFCC denying eligibility on appeal;
    (3) Include a statement explaining the reason(s) why eligibility 
should be granted;
    (4) Include a copy of the letter from the LFCC disapproving the 
original application, the organization's appeal to the LFCC, and the 
letter from the LFCC denying the appeal.
    (d) If an organization fails to file a timely application or a 
timely appeal of an adverse eligibility determination in accordance 
with these regulations, such application or appeal to OPM will be 
dismissed as untimely.
    (e) Appeals to the Director may not be used to supplement original 
applications that had missing or outdated documents. Any such 
supplemental documents will not be considered. Such appeals shall be 
limited to those facts justifying the reversal of the original 
decision.
    (f) The Director's decision is final for administrative purposes.

Subpart C--Federations


Sec. 950.301  National federations eligibility.

    (a) The Director may establish national federations that conform to 
the requirements of these regulations and are eligible to receive 
designations.
    (b) By applying for inclusion in the CFC, federations consent to 
allow the Director complete access to it and its members' CFC books and 
records and to [[Page 8968]] respond to requests for information by the 
Director.
    (c) An organization may apply to the Director for inclusion as a 
national federation to participate in the CFC if the applicant has, as 
members of its proposed federation, 15 or more charitable organizations 
that meet the eligibility criteria of Sec. 950.202 and Sec. 950.203. 
The initial year an organization applies for federation status, it must 
submit the applications of all its proposed member organizations in 
addition to the federation application. Federations must re-establish 
eligibility each year, however, the applications of its member 
organizations need not accompany the annual federation application once 
an organization has obtained federation status, unless requested by the 
Director.
    (d) After an organization has been granted federation status, it 
may certify that its member organizations meet all eligibility criteria 
of Sec. 950.202 and Sec. 950.203 to be included on the national list. 
Federation status in a prior campaign is not a guarantee of federation 
status in a subsequent campaign. Failure to meet minimum federation 
eligibility requirements shall not be deemed to be a decertification 
subject to a hearing on the record.
    (e) An applicant for national federation status must annually 
certify and/or demonstrate:
    (1) That all member organizations seeking participation in the CFC 
are qualified for inclusion on the national list. Applicants must 
provide a complete list of those member organizations it certified.
    (2) That its financial records, practices and procedures conform to 
generally accepted accounting principles and that it is annually 
audited by an independent certified public accountant in accordance 
with generally accepted auditing standards. A copy of the audit must be 
included with the application. The audit must verify that the 
federation is honoring designations made to each member organization. 
The audit requirement is waived for newly created federations operating 
for less than a year.
    (3) That it does not employ in its CFC operations the services of 
private consultants, consulting firms, advertising agencies or similar 
business organizations to perform its policy-making or decision-making 
functions in the CFC. It may, however, contract with entities or 
individuals such as banks, accountants, lawyers, and other vendors of 
goods and/or services to assist in accomplishing its ministerial tasks.
    (f) The Director will notify a federation if it is determined that 
the federation does not meet the eligibility requirements of 
Sec. 950.301(e). A federation may appeal an adverse eligibility 
decision in accordance with Sec. 950.205.
    (g) The Director may waive any eligibility criteria for federation 
status if it is determined that such a waiver will be in the best 
interest of the CFC.
    (h) Two organizations--American Red Cross and United Service 
Organization--are exempt from the 15-member requirement of 
Sec. 950.301(c).


Sec. 950.302  Responsibilities of national federations.

    (a) National federations must ensure that only those member 
organizations that comply with all eligibility requirements included in 
these regulations are certified for participation in the CFC.
    (b) The Director may elect to review, accept or reject the 
certifications of the eligibility of the members of the national 
federations. If the Director requests information supporting a 
certification of national eligibility, that information shall be 
furnished promptly. Failure to furnish such information within 10 
business days of the receipt of the request constitutes grounds for the 
denial of national eligibility of that member.
    (c) The Director may elect to decertify for up to one campaign year 
a federation which makes a false certification, subject to the 
requirement that any federation that the Director proposes to decertify 
shall be offered the opportunity to have a hearing on the record on the 
proposed decertification, followed by a written decision stating the 
grounds for the decertification. False certifications are presumed to 
be deliberate. This presumption may be overcome by evidence presented 
at the hearing.
    (d) The failure of a national federation to respond in a timely 
fashion to a request by the Director for required information or 
cooperation in an investigation or a settlement of disbursements may be 
grounds for decertification, provided that a decision to decertify is 
preceded by a hearing on the record and communicated in writing.
    (e) Each federation, as fiscal agent for its member organizations, 
must ensure that Federal employee designations are honored in that each 
member organization receives its proportionate share of receipts based 
on the results of each individual campaign.


Sec. 950.303   Local federations eligibility.

    (a) LFCC's must approve local federations that conform to the 
requirements of these regulations.
    (b) By applying for inclusion in the CFC, federations consent to 
allow the LFCC and Director complete access to it and its members' CFC 
books and records and to respond to requests for information by the 
LFCC, the Director.
    (c) An organization may apply to the LFCC for inclusion as a local 
federation if the applicant has as members of its proposed federation, 
15 or more charitable organizations that meet the eligibility criteria 
of Sec. 950.202, Sec. 950.203, and Sec. 950.204. The initial year an 
organization applies for federation status, it must submit to the LFCC 
applications of all its proposed member organizations in addition to 
the federation application. Federations must re-establish eligibility 
each year, however, the applications of its member organizations need 
not accompany the annual federation application once an organization 
has obtained federation status.
    (d) After an organization has been granted federation status, it 
may certify that its member organizations meet all eligibility criteria 
of Secs. 950.202, 950.203 and 950.204 to be included on the Local List. 
The LFCC or the Director may require any member organization of a local 
federation to supply independent evidence of its eligibility. 
Federation status in a prior campaign is not a guarantee of federation 
status in a subsequent campaign. Failure to meet minimum federation 
eligibility requirements shall not be deemed to be a decertification 
subject to a hearing on the record.
    (e) An applicant for local federation status must certify and/or 
demonstrate:
    (1) That all member organizations seeking participation in the CFC 
are qualified for inclusion on the Local List and provide a complete 
list of those member organizations it certified.
    (2) That its financial records, practices and procedures conform to 
generally accepted accounting principles and is annually audited by an 
independent certified public accountant in accordance with generally 
accepted auditing standards. A copy of the annual audit must be 
included with the application. The audit must verify that the 
federation is honoring designations made to each member organization. 
The audit requirement is waived for newly created federations operating 
for less than a year.
    (3) That it does not employ, in its CFC operations, the services of 
private [[Page 8969]] 
consultants, consulting firms, advertising agencies or similar business 
organizations to perform the policy-making or decision-making functions 
in the CFC. It may, however, contract with entities or individuals such 
as banks, accountants, lawyers, and other vendors of goods and/or 
services to assist in accomplishing its ministerial tasks.
    (f) The LFCC will notify a federation if it is determined that the 
federation does not meet the eligibility requirements of 
Sec. 950.301(e). A federation may appeal an adverse eligibility 
decision in accordance with Sec. 950.205.
    (g) The Director may waive any eligibility criteria for federation 
status if it is determined that such a waiver will be in the best 
interest of the CFC.


Sec. 950.304  Responsibilities of local federations.

    (a) Local federations must ensure that only those member 
organizations that comply with all eligibility requirements included in 
these regulations are certified for participation in the CFC.
    (b) LFCC's may elect to review, accept or reject the certifications 
of the eligibility of the members of local federations. If the LFCC 
requests information supporting a certification of local eligibility, 
that information shall be furnished promptly. Failure to furnish such 
information within 10 business days of the receipt of the request 
constitutes grounds for the denial of local eligibility.
    (c) The Director, upon recommendation by the LFCC, may elect to 
decertify a federation which makes a false certification for up to one 
campaign year, subject to the requirement that any federation that the 
Director proposes to decertify shall be offered the opportunity to have 
a hearing on the record on the proposed decertification, followed by a 
written decision stating the grounds for the decertification. False 
certifications are presumed to be deliberate. The presumption may be 
overcome by evidence presented at the hearing.
    (d) The failure of a local federation to respond in a timely 
fashion to a request by the Director or the LFCC for required 
information or cooperation in an investigation may be grounds for 
decertification, provided that a decision to decertify is preceded by a 
hearing on the record and communicated in writing.
    (e) Each federation, as fiscal agent for its member organizations, 
must ensure that Federal employee designations are honored in that each 
member organization receives its proportionate share of receipts based 
on the results of each individual campaign.

Subpart D--Campaign Materials


Sec. 950.401  Campaign and publicity materials.

    (a) The specific campaign and publicity materials, such as the 
official brochure, will be developed locally, except as specified in 
these regulations. All materials must be reviewed by the LFCC for 
compliance with these regulations and will be printed and supplied by 
the PCFO. Any disputes over local materials will be resolved by the 
LFCC. All publicity materials must have the approval of the LFCC before 
being used. Federations must notify the PCFO in writing of their desire 
to participate in the development of campaign and publicity materials. 
The PCFO must respond in a timely manner to a federation's request to 
participate in the development of campaign and publicity materials. 
Federations must also respond in a timely fashion in the development of 
campaign and publicity materials.
    (b) During the CFC solicitation period, participating CFC 
organizations may distribute bona fide educational materials describing 
its services or programs. The organization must be granted permission 
by the Federal agency installation head, or designee to distribute the 
material. CFC Coordinators, Keyworkers or members of the LFCC, are not 
authorized to grant permission for the distribution of such materials. 
If one organization is granted permission to distribute educational 
materials, then the Federal agency installation head must allow any 
other requesting CFC organization to distribute educational materials.
    (c) Organizations and federations are encouraged to publicize their 
activities outside Federal facilities and to broadcast messages aimed 
at Federal employees in an attempt to solicit their contributions 
through the media and other outlets.
    (d) LFCC's are further authorized to permit the distribution by 
organizations of promotional pamphlets to Federal personnel in public 
areas at or near Federal workplaces in connection with the CFC, 
provided that the manner of distribution accords equal treatment to all 
charitable organizations furnishing such pamphlet for local use, and 
further provided that no such distribution shall utilize Federal 
personnel on official duty or interfere with Federal government 
activities. LFCC members and other campaign personnel are to be 
particularly aware of the prohibition of assisting any charitable 
organization or federated group in distributing any type of literature, 
especially during the campaign period. Nothing in this section shall be 
construed to require an LFCC to distribute or arrange for the 
distribution of any material other than the Campaign Brochure and the 
pledge card.
    (e) The Campaign Brochure and pledge card is the official CFC 
information package and shall be made available to all potential 
contributors. All CDC Brochures must inform employees of their right to 
make a choice to contribute or not to contribute; to designate or not 
to designate; and to give a confidential gift in a sealed envelope.
    (f) Campaign materials must constitute a simple and attractive 
package that has fundraising appeal and essential working information. 
The package should focus on the CFC without undue use of charitable 
organization symbols and logos or other distractions that compete for 
the donor's attention. Extraneous instructions concerning the routing 
of forms, tallying of contributor's receipts, and similar reports, 
which are primarily for keyworkers must be avoided.
    (g) The following applies specifically to the campaign brochure:
    (1) Contributor's Information Section will include:
    (i) A description of the CFC arrangement and explain the payroll 
deduction privilege. It will clearly state that the Federal donor can 
direct his or her gift to specific charitable organizations or 
federations of his or her choice, or to the international general 
designation option, and urge them to do so. It will further explain 
that failure to designate a specific organization or federation will 
result in the undesignated donation being distributed proportionately 
to all recipient organizations in the local campaign, minus a 15 
percent administration fee to the PCFO.
    (ii) A statement that the donor may only designate charitable 
organizations or federations that are listed in the brochure and that 
write-ins are prohibited.
    (iii) Instructions as to how an employee may obtain more specific 
information about the programs and the finances of the organizations 
participating in the campaign.
    (iv) A description of employees' rights to pursue complaints of 
undue pressure or coercion in Federal fundraising activities. The 
Campaign Brochure will advise civilian employees to consult with their 
personnel offices and military personnel with their commanding officers 
to identify the organization [[Page 8970]] handling such complaints in 
their respective Federal agencies.
    (2) Organization Listing Section.
    (i) The listing of organizations shall be in three major divisions. 
The first is referred to as introductory pages, the second shall be 
labelled national list and will consist of a faithful reproduction of 
the list of national and international organizations provided by OPM as 
described in Sec. 950.201(b). The third division will consist of the 
Local List. In odd-numbered campaign years the Local List shall appear 
before the national list and after the introductory pages. In even-
numbered campaign years the national list shall appear before the Local 
List and after the introductory pages. The order of the listing of the 
federated and unaffiliated organizations within the National and Local 
Lists will be determined by a random drawing. The order of 
organizations within each federation will be determined by the 
federation. The order of organizations within the unaffiliated lists 
will be alphabetical. Absent specific instructions from OPM to the 
contrary, each participating organization and federated group listing 
must include a description, not to exceed 25 words, of their services 
and programs, plus a telephone number for the Federal donor to request 
further information about the group's services, benefits, and 
administrative expenses. Each listing will include a statement of the 
percentage of the organization's total receipts and revenues that are 
used for administration and fundraising. Neither the percentage of 
administrative and fundraising expense, nor the telephone number count 
toward the 25-word statement.
    (ii) Each national federation and charitable organization will be 
assigned a code number by OPM. Local federations and local charitable 
organizations will be assigned code numbers by the LFCC. At the 
beginning of each federated group's listing will be the federation's 
name, code number, 25-word statement, percentage of administrative and 
fundraising expenses, and telephone number. The sections of the 
brochure where the unaffiliated agencies are listed will begin with the 
titles National Unaffiliated Organizations, International Unaffiliated 
Organizations and Local Unaffiliated Organizations respectively.
    (iii) Preceding any other listing of the eligible organizations, 
the Organization Listing Section will begin with the heading Definition 
of a Federation followed by this definition of a federation: A 
federation is a group of voluntary charitable human health and welfare 
organizations established for the purpose of providing common 
fundraising, administrative, and management services to its members. 
Federations may be either national, representing national and/or 
international organizations, international, representing only 
international organizations; or local, representing local and/or 
regional organizations. If you wish to designate all or some portion of 
your contribution to a federation, record that federation's 
corresponding code number in one of the boxes on your pledge card. 
Contributions designated to a federation will be shared in accordance 
with the federation's policy.
    (iv) In even-numbered campaign years, immediately following the 
definition of a federation will be the heading National Federations 
which will be followed by the list of all the national federations. 
Following the list of national federations will be the list of all the 
international federations. Immediately following the end of that list 
the heading, Local Federations will begin the list of local 
federations. In odd-numbered campaign years, the local federations will 
immediately follow the definition of a federation. After each 
federation will be the statement, Federation and federation member 
listings begin on page ______.
    (v) Immediately following the list of federations will be the 
heading, Unaffiliated Organizations. This section will inform the donor 
on which pages the list of national, international and local 
unaffiliated organizations begins.
    (vi) Immediately following the unaffiliated section will be the 
heading, International General Designation Option. This option will 
include the following explanation and the code for designating it: 
``IIII--All Organizations in the International Section of the national 
list. I request that my gift be shared among all the international 
organizations listed in the International Section of the Organization 
Listing in the same proportion that they received designations.''
    (vii) Immediately following the International General Designation 
Option will be the heading Undesignated Funds. Beneath this heading the 
following explanation of the distribution of undesignated funds will 
appear: ``Even if you choose not to designate to a specific 
organization or federation, your contribution will still be accepted. 
These undesignated funds will be distributed to all organizations in 
the brochure in the same proportion that the organizations and 
federations received designations in the CFC.''
    (viii) The international general designation option on the 
introductory pages will be printed in the same format and font as the 
organizations listed in the brochure. No special prominence or emphasis 
may be placed on the federations listed.
    (h) Pledge Card. The pledge card as described in Sec. 950.402 will 
be distributed with the campaign Brochure.
    (i) Omission of an eligible charitable organization from the 
Brochure may require that all Brochures be reprinted and redistributed. 
The Director or LFCC may direct that the cost of such reprinting and 
redistribution be borne by the PCFO or charged to CFC administrative 
expenses.
    (j) Dual listing. Listing of a national organization, as well as 
its local affiliate organization, is permitted. However, a national 
organization may only waive its listing in the national section of the 
brochure in favor of its eligible local affiliate. The local affiliate 
must include in its application the written waiver from its national 
organization.
    (k) Multiple listing. Each national or local organization must 
individually meet all of the eligibility criteria and submit 
independent documentation as required in Sec. 950.202, Sec. 950.203 or 
Sec. 950.204. Once an organization is deemed eligible, it is entitled 
to only one listing in the CFC Brochure, regardless of the number of 
federations to which that organization belongs.
    (l) The LFCC may omit the 25-word program description from the CFC 
Brochure if, in the immediately preceding campaign year, contributions 
received in the local CFC totalled less than $100,000.


Sec. 950.402  Pledge card.

    (a) The Director will make available each campaign year at least 
one model pledge card which shall be faithfully reproduced at the local 
level. This will be the only authorized pledge card for use in that 
year's CFC.
    (b) Campaigns may incorporate additional giving levels to the 
Director's authorized pledge card. Campaigns may also include their 
award recognition program. No further modifications to the pledge card 
are permitted unless approved in advance by the Director.
    (c) An employee may not make a designation to an organization not 
listed in the Brochure. In addition, an employee may not make a CFC 
contribution to an organization listed in the Brochure of a campaign 
covering a geographic location different from the campaign where the 
employee works. Designations made to organizations not listed in the 
Brochure are not invalid, but will be treated as undesignated funds and 
distributed accordingly. [[Page 8971]] 
    (d) In the event the PCFO receives a pledge card that has 
designations that add up to less than the total amount pledged, the 
PCFO must honor the total amount pledged and treat the excess amount as 
undesignated funds. In the event that a PCFO received a pledge card 
that has a total amount pledged that is less than the sum of the 
individual designations, the PCFO must honor the designations by 
assigning a proportionate share of the total gift to each organization 
designated. For example, if an employee indicates a total gift of $100 
in the upper portion of the pledge card, but designates $25 each to 
five organizations in the lower part of the pledge card, the PCFO must 
adjust each organization's designation to $20.


Sec. 950.403  Penalties.

    A PCFO's failure to comply with subpart D of these regulations may 
result in either disqualification from future service as PCFO, 
disqualification as a participating federation, or both penalties. 
These penalties may only be imposed after a hearing on the record and 
communication of the Director's decision in writing.

Subpart E--Distribution of Undesignated Funds


Sec. 950.501  Applicability.

    The distribution of undesignated funds described in 
Sec. 950.401(g)(2)(vii) and Sec. 950.502 applies to all domestic area 
campaigns. It does not apply to the DOD Overseas Campaign.


Sec. 950.502  Distribution of undesignated funds.

    The PCFO shall collect from undesignated funds a 15 percent 
administration fee for performing the services of PCFO as set forth in 
Sec. 950.106(d). All remaining undesignated funds shall be distributed 
to all of the organizations in the CFC Brochure in the same proportion 
that they received designations in the campaign.


Sec. 950.503  Review by the Director.

    The Director may alter an LFCC's distribution of undesignated 
funds:
    (a) To reverse any allocation to ineligible organizations;

or

    (b) To enforce the distribution method described in 
Secs. 950.401(g)(2)(vii) and 950.502.

Subpart F--Miscellaneous Provisions


Sec. 950.601  Release of contributor names.

    (a) The pledge card, designed pursuant to Sec. 950.402, must allow 
an employee to indicate if the employer does not wish his or her name 
and home address forwarded to the charitable organization or 
organizations designated. A PCFO's failure to honor an employee's wish 
may result in the decertification of the PCFO.
    (b) The pledge card will direct an employee to provide his or her 
complete home address on the pledge card should he or she wish his or 
her name and home address released to organizations receiving their 
donations.
    (c) It is the responsibility of the PCFO to forward the names and 
addresses of employees who have indicated that they wish their names be 
forwarded, to the recipient organization directly, if the organization 
is unaffiliated, and to the organization's federation if the 
organization is a member of a federation. The PCFO may not make any 
other use of these employees' names and addresses.
    (d) Recipient organizations that receive the names and addresses of 
employees must segregate this information from all other lists of 
contributors. This segregated list may not be sold or in any way 
released to anyone outside of the recipient organization. Federations 
may not use a member organization's list for its own purposes or share 
its member's lists among federation members. Failure to protect the 
integrity of this information may result in penalties up to and 
including permanent expulsion from the CFC.
    (e) Organizations must cooperate fully with OPM investigations into 
the care and appropriate use of these lists. Should an organization 
ignore or fail to respond to OPM's requests for cooperation or hamper 
an investigation, the Director may propose that the organization be 
suspended or expelled from the CFC. The Director will consider any 
response in issuing a decision.


Sec. 950.602  Solicitation methods.

    (a) Employee solicitations shall be conducted during duty hours 
using methods that permit true voluntary giving and shall reserve to 
the individual the option of disclosing any gift or keeping it 
confidential. Campaign kick-offs, victory events, awards, and other 
non-solicitation events to build support for the CFC are encouraged.
    (b) Special CFC fundraising events, such as, raffles, lotteries, 
auctions, bake sales, carnivals, athletic events, or other activities 
not specifically provided for in these regulations are prohibited 
unless approved by the appropriate agency head or government official 
consistent with agency ethics regulations.
    (c) In all approved special fundraising events the donor must have 
the option of designating to a specific participating organization or 
federation or be advised that the donation will be counted as an 
undesignated contribution and distributed according to these 
regulations.


Sec. 950.603  Sanctions.

    (a) Sanctions not specifically provided for elsewhere in these 
regulations, may be imposed on an organization, federation or PCFO for 
violating any provisions of these regulations, other applicable 
provisions of law, or any directive or instruction from the Director. 
The Director will determine the appropriate sanction, up to and 
including permanent expulsion from the CFC, based on a progressive 
schedule which is related to the severity of the violation. In 
determining the appropriate sanction, the Director will consider all 
elements such as previous violations, harm to Federal employee 
confidence in the CFC, and any other relevant factors. The Director 
shall provide written notification to the organization, federation or 
PCFO regarding the alleged violation and of the intent to impose a 
sanction. Prior to implementation of sanctions under this section, the 
organization, federation or PCFO shall be provided an opportunity to 
address in writing why the sanctions should not be imposed. This 
submission must be received within 10 calendar days from the date of 
receipt of the Director's notification letter.
    (b) At the Director's discretion, PCFO's and Federations may be 
directed to suspend distribution of current and future CFC donations 
from Federal employees to recipient organizations. Federations and 
PCFO's shall immediately place suspended contributions in an interest 
bearing account until directed to do otherwise.


Sec. 950.604  Records retention.

    Federations, PCFO's and other participants in the CFC shall retain 
documents pertinent to the campaign for at least three (3) campaign 
years. Documents requested by OPM must be made available within 10 
business days of the request.

Subpart G--DoD Overseas Area


Sec. 950.701  DoD overseas campaign.

    (a) A Combined Federal Campaign is authorized for all Department of 
Defense (DoD) activities in the overseas areas during a 6 week period 
in the fall. Organizations that may participate in the Overseas 
Campaign will consist of [[Page 8972]] organizations found nationally 
eligible by OPM.
    (b) The DoD must select an organization or combination of 
organizations to serve as PCFO as it deems in the best interests of the 
overseas campaign.
    (c) Federal civilian agencies with overseas personnel may elect to 
have these employees participate in the DoD campaign or in the National 
Capital Area campaign.
    (d) The overseas campaign brochure shall not include the All 
International Organizations Designation Option-IIII.
    (e) Family support and youth activities established in overseas 
locations may be supported from CFC funds.
    (f) Undesignated funds contributed in the Overseas Campaign equal 
to up to 6 percent of the gross campaign contributions will be 
allocated to the Overseas family support and youth activities. No other 
funds may be used for this purpose. If the undesignated funds exceed 6 
percent of the gross campaign contributions, this excess shall be 
distributed to all other organizations in the same proportions as 
designations.
    (g) Overseas family support and youth activities shall not be 
charged any share of campaign costs. All other organizations 
participating in the Overseas Area CFC will be charged for campaign 
costs in the same proportion that they received gross campaign 
receipts, net of that amount of receipts set aside for family support 
and youth activities.
    (h) The overseas campaign brochure must explain the allocation 
policy utilized by each of the military services to allocate funds 
received from the Overseas campaign to their overseas family support 
and youth activities.

Subpart H-CFC Timetable


Sec. 950.801  Campaign schedule.

    (a) The Combined Federal Campaign will be conducted according to 
the following timetable.
    (1) During one 30-calendar day period between January and March, as 
determined by the Director, OPM will accept applications from 
organizations seeking to be listed on the national list.
    (i) Included with the annual notice of the campaign schedule and 
OPM guidance will be a list of the LFCCs responsible for making 
statewide determinations for local eligibility.
    (ii) Organizations seeking statewide recognition must contact the 
applicable LFCC for detailed information on the local application 
process.
    (2) Within 35 calendar days of the closing of the receipt of 
applications, the Director will issue notices to each national 
applicant organization of the results of the Director's review.
    (3) Local Federal Coordinating Committees must select a PCFO no 
later than March 15.
    (4) The Director will issue a national eligibility list to all 
local campaigns by June 30.
    (5) Local Federal Coordinating Committees must accept applications 
from organizations seeking local eligibility for 30 calendar days as 
determined by the LFCC, and must issue notice of its eligibility 
decisions within 15 business days of the closing date for receipt of 
applications.
    (b) The Director will annually issue a timetable for accepting and 
processing national applications.

Subpart I--Payroll Withholding


Sec. 950.901  Payroll allotment.

    The policies and procedures in this section are authorized for 
payroll withholding operations in accordance with the Office of 
Personnel Management Pay Administration regulations in part 550 of this 
chapter.
    (a) Applicability. Voluntary payroll allotments will be authorized 
by all Federal departments and agencies for payment of charitable 
contributions to local CFC organizations.
    (b) Allottees. The allotment privilege will be made available to 
Federal personnel as follows:
    (1) Employees whose net pay regularly is sufficient to cover the 
allotment are eligible. An employee serving under an appointment 
limited to 1 year or less may make an allotment to a CFC when an 
appropriate official of the employing Federal agency determines that 
the employee will continue employment for a period to justify an 
allotment. This includes military reservists, National Guard, and other 
part-time and intermittent employees who are regularly employed.
    (2) Members of the Uniformed services are eligible, excluding those 
on only short-term assignment (less than 3 months).
    (c) Authorization. (1) Allotments will be totally voluntary and 
will be based upon contributor's individual authorization.
    (2) The CFC Pledge Card, in conformance with Sec. 950.402, is the 
only form for authorization of the CFC payroll allotment and may be 
printed or purchased from a central source by each PCFO. The Pledge 
Cards and Official Brochure will be distributed to employees when 
charitable contributions are solicited.
    (3) The original copy of each pledge card (payroll allotment 
authorization) should be transmitted to the contributor's servicing 
payroll office as promptly as possible, preferably by December 15. 
However, if pledge cards are received after that date they should be 
accepted and processed by the payroll office.
    (d) Duration. Authorization of allotments will be perpetual or in 
the form of a term allotment. A perpetual authorization becomes 
effective the first pay period beginning in January and will remain in 
effect from year-to-year until cancelled by the Federal employee/donor. 
Perpetual authorizations may only be changed during the campaign 
solicitation period as defined by the LFCC. Term authorizations will be 
in effect for 1 full year--26, 24, or 12 pay periods depending on the 
allotter's pay schedule--starting with the first pay period beginning 
in January and ending with the last pay period that begins in December. 
Three months of employment is considered the minimum amount of time 
that is reasonable for establishing an allotment.
    (e) Amount. (1) Allotters will make a single allotment that is 
apportioned into equal amounts for deductions each pay period during 
the year.
    (2) The minimum amount of the allotment will be determined by the 
LFCC but will not be less than $1 per payday, with no restriction on 
the size of the increment above that minimum.
    (3) No change of amount will be authorized for term allotments. 
Changes in amounts for perpetual allotments may only occur during the 
solicitation period, unless the donation is based on a percentage of 
the employees pay.
    (4) No deduction will be made for any period in which the 
allotter's net pay, after all legal and previously authorized 
deductions, is insufficient to cover the CFC allotment. No adjustment 
will be made in subsequent periods to make up for missed deductions.
    (f) Remittance. (1) One check will be sent by the payroll office 
each pay period, in the gross amount of deductions on the basis of 
current authorizations, to the Central Receipt and Accounting Point 
(CRP) at each local CFC location for which the payroll office has 
received allotment authorizations. The Director will provide a list of 
the authorized CRP's to Federal payroll offices.
    (2) The check will be accompanied by a statement identifying the 
agency, the dates of the pay period, and the total number of employee 
deductions. There will be no listing of allotters included or of 
allotter discontinuances.
    (g) Discontinuance. (1) Term allotments will be discontinued 
[[Page 8973]] automatically on expiration of the 1 year withholding 
period, or on the death, retirement, or separation of the allotter from 
the federal service, whichever is earlier.
    (2) An allotter may revoke a perpetual or term authorization at any 
time by requesting it in writing from the payroll office. 
Discontinuance will be effective the first pay period beginning after 
receipt of the written revocation in the payroll office.
    (3) A discontinued allotment will not be reinstated.
    (h) Transfer. When an allotter moves to another organizational unit 
served by a different payroll office in the same CFC location, whether 
in the same office or a different Department or agency, his or her 
allotment authorization should be transferred to the new payroll 
office.
    (i) Accounting. (1) Federal payroll offices will oversee the 
establishment of individual allotment accounts, the deductions each pay 
period, and the reconciliation of employee accounts in accordance with 
agency and General Accounting Office requirements. The payroll office 
will accept responsibility for the accuracy of remittances, as 
supported by current allotment authorizations, and internal accounting 
and auditing requirements.
    (2) The PCFO shall notify the federated groups, national agencies, 
and local agencies as soon as practicable after the completion of the 
campaign, but in no case later than February 15, of the amounts, if 
any, designated to them and their member agencies and of the amounts of 
the undesignated funds, if any, allocated to them.
    (3) The PCFO is responsible for the accuracy of disbursements it 
transmits to recipients. It shall transmit at least monthly for 
campaigns of $500,000 of more or quarterly if less than that amount, 
minus only the approved proportionate share for administrative cost 
reimbursement and the PCFO fee set forth in Sec. 950.106(d). It shall 
remit the contributions to each organization or to the federated group, 
if any, of which the organization is a member. For campaigns with gross 
receipts in excess of $500,000, the PCFO will distribute all CFC 
receipts beginning April 1, and monthly thereafter. For campaigns with 
gross receipts of $500,000 or less, the PCFO will distribute all CFC 
receipts beginning June 1, and quarterly thereafter. At the close of 
each disbursement period, the PCFO's amount shall have a balance of 
zero.
    (4) The PCFO may make one-time disbursements to organizations 
receiving minimal donations from Federal employees. The LFCC must 
determine and authorize the amount of these one-time disbursements. The 
PCFO may deduct the proportionate amount of each organization's share 
of the campaign's administrative costs and the average of the previous 
3 years pledge loss from the one-time disbursement. This is the only 
approved application of adjusting for pledge loss.
    (5) Federated and national charitable organizations, or their 
designated agents, will accept responsibility for:
    (i) The accuracy of distribution amount the charitable 
organizations of remittances from the PCFO; and
    (ii) Arrangements for an independent audit conducted by a certified 
public accountant agreed upon by the participating charitable 
organizations.
[FR Doc. 95-3821 Filed 2-15-95; 8:45 am]
BILLING CODE 6325-01-M