During calendar year 2010, HHS had 6,697 employees who were appointed under sections 209(f) or (g).served at the National Institutes of Health (NIH), the Food and Drug Administration (FDA), or the Centers for Disease Control and Prevention (CDC), while the remaining employees served in the Office of the Secretary or within other operating divisions, as shown in figure 1. Congress provided EPA with the authority to use Title 42 to employ up to 30 persons at any one time through fiscal year 2015. At the time of our study, EPA had appointed 17 fellows in its Office of Research and Development from 2006 to 2011 under section 209(g) and all 17 fellows remained with EPA. Appointments for the three fellows hired in 2006 have been renewed for another 5-year term. Figure 2 shows the cumulative onboard Title 42 staff, by new hire or conversion. According to EPA officials, the agency has identified mission critical personnel needs and is actively recruiting to fill the 13 remaining authorized Title 42 positions. The agency has no plans to use authority under section 209(f) at this time, but may consider it in the future. Officials told us EPA would need to develop guidance for implementing section 209(f) before using the authority. Title 42 fellows at EPA lead scientific research initiatives, are considered experts in the related scientific discipline, and some manage or direct a division or office. According to EPA officials, Title 42 provides two important tools EPA needs to achieve its mission: (1) the flexibility to be competitive in recruiting top experts who are also sought after by other federal agencies, private industry, and academia; and (2) the appointment flexibility needed to align experts with specific skills to changing scientific priorities. EPA officials stated it is not the agency’s intention to hire a fellow long-term under Title 42, but rather employ the individual as long as a priority remains high. Annual salaries for Title 42 fellows at EPA range from approximately $153,000 to $216,000, with an average salary of about $176,000 and a median salary of about $171,000. As shown in table 4, 15 of the 17 EPA fellows had salaries exceeding Executive Level IV. In December 2010, EPA began a pilot of using market salary data to estimate salaries of what Title 42 candidates could earn in positions outside of government given their education, experience, professional standing, and other factors. EPA used the market salary data to inform salary negotiations for the five fellows appointed since the implementation of the pilot. According to EPA officials, the market salary pilot concludes in December 2012 and its effect will be analyzed at that time. In appointing Title 42 fellows, EPA generally followed appointment guidance described in its Title 42 Operations Manual. EPA could, however, improve procedures for resolving potential conflicts of interest. We conducted 10 case file reviews of EPA Title 42 employees and in two cases we reviewed, employees had potential conflict of interest situations arise after appointment resulting, in part, from the agency’s failure to ensure Title 42 employees followed agreed upon ethics requirements. EPA acknowledged it could improve its postappointment ethics oversight and reported it has plans to ensure that Title 42 employees follow requirements such as submitting confirmation of stock divestitures to its General Counsel, for example, and other ethics requirements. However, at the time of our review, EPA had not provided us with implementation plans or timeframes for its improved oversight. To address this issue, we recommended that EPA, as part of its efforts to improve postappointment ethics oversight, develop and document a systematic approach for ensuring Title 42 employees are compliant with ethics requirements after appointment. EPA disagreed with our recommendation, citing certain actions already taken, such as a plan to require proof of compliance with ethics agreements. We acknowledged EPA’s plans to address these issues, but maintained the recommendation was needed to ensure implementation because the two ethics issues we reported occurred over 2 years ago. Our legal opinion, issued on July 11, 2012, responded to a Congressional request for our views on whether there are statutory caps on pay for consultants and scientists appointed pursuant to 42 U.S.C. §§ 209(f) or (g). We concluded that an appropriations law provision enacted as part of the Fiscal Year 1993 Labor-HHS-Education Appropriations Act established a permanent appropriation cap on the pay of individuals appointed on a limited-time basis under 42 U.S.C. §§ 209(f) or (g) at agencies funded through that Act. With regard to individuals not subject to this cap, we concluded further that two other pay limitations set forth in Title 5 of the U.S. Code that we considered do not apply to appointments made pursuant to 42 U.S.C. §§ 209(f) or (g). Federal pay systems are extremely complex, and we encountered challenges in attempting to resolve ambiguities arising from pay laws enacted at different times over nearly 70 years. Sections 209(f) and (g) of title 42 were enacted in 1944 and have not been amended since that time. There have, however, been many significant changes in related laws and regulations that were relevant to our consideration of the issues raised. Consequently, we conducted extensive research of legislative history to aid in our understanding of congressional actions and the interplay of the laws addressed below, and examined regulations issued pursuant to these provisions over the last 65 years. We also solicited the views of HHS, the Office of Personnel Management (OPM), and the EPA. The appropriations for each fiscal year from 1957 through 1993 included a cap on pay for “consultants or individual scientists appointed for limited periods of time” (underscoring added) pursuant to 42 U.S.C. §§ 209(f) or (g). The appropriations for fiscal year 1993 established a permanent cap on such compensation, providing that pay may be set at rates not to exceed “the per diem rate equivalent to the maximum rate payable for senior-level positions under 5 U.S.C. § 5376.” This cap currently limits base pay to $155,500. Our review of the legislative history of the first appropriation to contain the limit indicated that it was enacted due to other restrictions in law on compensation as an increase over then-existing pay authority. We considered the meaning of the phrase “for limited periods of time,” which has appeared in all of the relevant appropriations provisions from 1956 to 1993. In 1956, when this language was first included in the appropriations law, the Public Health Service’s regulations included time limitations on employment. Thus the time limit generally applied to all consultant appointments made under section 209(f) beginning in 1947, when the regulation containing the limit was first promulgated, unless “special circumstances” led the administrator to approve an extension. Further, the limit was in effect in 1956, when the first appropriations law provision referring to consultants appointed for “limited periods of time” was enacted. However, this time limitation was removed from the regulations in 1966. 31 Fed. Reg. 12,939 (Oct. 5, 1966). Therefore, the appropriations pay cap applied to all section 209(f) consultants from 1956 until HHS changed the regulations in 1966 allowing for the hiring of consultants for indefinite periods. Although the regulations implementing section 209(f) no longer included a time limitation on the employment of special consultants after 1966, the appropriations provisions for 1967 and subsequent years, using virtually identical language each year, imposed a cap only on pay of “consultants or individual scientists appointed for limited periods of time pursuant to .” The appropriations restriction did not impose any cap on pay for those consultants whose appointments were not limited in time. As a result, after the 1966 regulations were promulgated and continuing to the present, HHS has employed two categories of consultants: those appointed for limited periods of time, to whom the pay cap applies, and consultants appointed for indefinite periods, to whom the pay cap does not apply. Importantly, the appropriations pay restriction is applicable only to payments made from Labor-HHS-Education Appropriations Acts. Three components of the Public Health Service (the Agency for Toxic Substances and Disease Registrations, the Food and Drug Administration, and the Indian Health Services) are funded by appropriations acts other than the Labor-HHS-Education Appropriations Act, and are not covered by a restriction on funds appropriated under that Act. Thus, we concluded that there is a cap of Executive Level IV on the pay of consultants and scientists employed for limited periods of time pursuant to 42 U.S.C. §§ 209(f) or (g) in all but three of the Public Health Service Agencies. With respect to individuals not covered by the appropriation cap, we examined the applicability of two pay limitations found in title 5: section 3109, which limits pay for consultants “procure” on a temporary or intermittent basis, and section 5373, which limits pay fixed by administrative action. Section 3109, enacted in 1946, establishes specific legal parameters, including a pay cap and a limit on appointment duration, governing the employment of experts or consultants whose appointment must be authorized by an “appropriation or other statute.” That pay cap applies unless a different cap is authorized by the appropriation or another statute. Beginning in 1956, Congressional actions signaled that section 3109 did not apply to section 209(f) appointments. From1956 and continuing until 1993, Congress enacted provisions yearly in appropriations acts that set a cap (which may or may not have been higher than that found in section 3109 in any given year) for all those appointed pursuant to sections 209(f) or (g) for a limited period of time and funded out of the Labor-HHS- Education Appropriations Act. From fiscal year 1970 until the provisions became permanent in fiscal year 1993, the appropriations acts for HHS contained separate provisions placing identical compensation limits for experts and consultants subject to 5 U.S.C.