| SERVING AS AN OFFICER IN AN OUTSIDE ORGANIZATION |
When official time is granted to an employee for service in a private sector organization, especially service as an officer, the primary beneficiary of the employee's service must be the DOI programs and operations and not the individual employee or the outside organization.
Employees may serve in outside organizations under three different circumstances:
All employees who are required, or wish to serve as an officer in a private sector organization while on official Government duty time must:
18 U.S.C. § 208(b)(1) WAIVERS
Decisions issued late last year by the Office of Government Ethics (OGE) and the Department of Justice (DOJ) indicate that OGE and DOJ now take the position that official-capacity service on the board or as an officer of an outside group has inherent inconsistencies with the conflict of interest prohibition at 18 U.S.C. § 208(a).
Attached is a DRAFT model waiver letter that was developed at HHS to address situations where an employee is serving in his/her official capacity as an officer, director or trustee in a non-federal non-profit organization. The letter must be signed by the Director.
While a waiver under 18 U.S.C. § 208(b) may be appropriate, it is only one option for resolving this problem. However, you should consider other available options, outlined below.
1. Special statutory authority. An employee may serve in an official capacity as an officer, director or trustee if a federal statute expressly authorizes such service, such as in an ex officio capacity.
2. Release of fiduciary obligations. An employee may serve in an official capacity as an officer, director or trustee if the outside organization releases the individual from all fiduciary responsibilities under applicable state law.
3. Federal liaison status. An employee may be assigned to serve as a federal liaison to the outside entity, e.g., where the employee has no fiduciary duties. This kind of service would not be covered by section 208. In this capacity, the employee would be the USGS representative to the organization, would present and receive information and views on behalf of the Survey, and could coordinate joint activities. The essential factor here is that the employee's only duty would be to the Government, thus avoiding the conflicting obligations inherent in serving in a fiduciary capacity to an outside group while in one's official capacity.
4. Private outside activity. An employee may serve a non-federal organization as a director, officer, or trustee in a purely private capacity as an outside activity. Such activities, of course, raise their own ethics concerns: Employees must comply with all applicable rules covering outside activities (such as the need for prior authorization and the prohibition against unauthorized use of official time and equipment for outside activities), must recuse themselves from any Bureau matter that affects a financial interest of the organization, and must avoid any appearance of using their public office for private gain of the organization.
1. This document sets forth an agreement between the U.S. Department of the Interior (DOI) and the (organization name) concerning the service of (employee name) as an officer in the (organization name) as a part of his official government duties.
2. The primary beneficiary of (employee name)'s service as an (organization name) officer is intended to be the DOI. It is expected that the benefits to the DOI will include, but not be limited to the following:
(suggested benefits:)
a. acquisition of state-of-the-art technical information about (name subjects).
b. knowledge about organizational arrangements and relationships of organizations with which the DOI interacts, in order to enhance the working relationships between the DOI and such other organizations;
c. improved understanding of current issues in the (name the field of endeavor) that concern DOI missions and operations;
d. utilization of professional networks and channels to disseminate information relevant to the accomplishment of DOI missions; and
e. utilization of other mechanisms to facilitate accomplishment of DOI missions, functions and processes, such as meetings, conferences, symposia, and publications.
3. In order to avoid the possibility of an actual or apparent use of public office for private gain, when official time is used for service as an officer in the (name of organization), the following principles will apply:
a. Federal employees may not represent anyone other than the United States before an agency or court in connection with a particular matter in which the U.S. is a party or has a direct and substantial interest (18 U.S.C. § 205).
b. Federal employees are required to refrain from working on particular matters as a Government employee when the employee is serving as an officer in a private organization and the organization in which he is serving has a financial interest in those Government matters (18 U.S.C. § 208).
c. If a Federal employee's participation in a project undertaken in conjunction with a private organization was done as a part of his official duties, the employee is prohibited from sharing in any compensation by the dual compensation provisions of law (18 U.S.C. § 209).
d. Federal employees are prohibited from using official time and Government equipment to instigate and generate lobbying activity on any issue pending before or of interest to the Congress (18 U.S.C. § 1913).
e. Federal employees are prohibited from controlling or assuming any measure of practical responsibility for the fund raising activities of private individuals or organizations (E.O. 12731).
4. The relationship between the (organization name) and the DOI addressed in this document is intended to enhance service to the American public through more efficient applications of DOI programs. All actions should be directed toward attainment of that mutually beneficial goal.
5. The foregoing is not intended to impose on the (organization name) any obligations or restrictions, other than an obligation to respect the above described limitations on the activities and function of, and benefits which may be received by, nor does it constitute a representation or warranty by the (organization name) as to the benefits which the DOI will receive in fact from (employee name)'s service as an officer in the (organization name). Neither does the (organization name) assume any obligation to enquire into or enforce (employee name)'s compliance with paragraph 3c. above.
Date:______
Date:______
WAIVER
(Sample 208(b)(1)Waiver)
MEMORANDUM
TO: [Name of Bureau Director]
FROM: [Deputy Ethics Counselor]
SUBJECT: Conflict of Interest Waiver for [name of employee]
The purpose of this memorandum is to request that you grant [name of employee] a waiver of the criminal conflict of interest provisions that may apply to [his or her] service in an official capacity as [an officer or a member of the board of directors, or other position] of an outside non-profit organization. The need for a waiver is discussed below.
The criminal conflict of interest statute, 18 U.S.C. § 208(a), requires that an employee refrain from participating personally and substantially in an official capacity in any particular matter that will have a direct and predictable effect on the financial interests of any organization in which the individual serves as an officer, director, trustee, or employee.
In the absence of: (1) specific statutory authority placing a federal employee in an officer or director position in an ex officio capacity, (2) a release of fiduciary obligations by the organization (if permitted by state law), or (3) a waiver of the requirements of section 208(a), the conflicts statute effectively would preclude [the employee's] service, as an official duty activity, as [officer, director, or other position] of [name of organization].
[Describe position and organization.] [Describe relationship of organization, if any, to Departmental programs or operations.]
Inasmuch as [the employee's] [appointment, election, or selection] as [officer, director, or other position] of [name of organization] is not pursuant to a statute or release of fiduciary obligations, [he or she] has requested that you, as the official responsible for [his or her] appointment to a federal position or the official to whom waiver authority is delegated, authorize [his or her] participation in certain particular matters that may affect the financial interests of [name of organization]. Under section 208(b)(1), a waiver may be granted if the selecting official or delegate determines that the disclosed financial interest is "not so substantial as to be deemed likely to affect the integrity of the services which the Government may expect from . . . [the] employee."
In the course of [his or her] assigned duties as [employee's government title], the following types of particular matters potentially could come before [the employee] for [his or her] personal and substantial participation: (1) particular matters of general applicability, such as legislation, regulation, or policy, that may affect the financial interest of [name of organization] as a member of a class of similarly situated entities; (2) matters that affect one or more of the underlying holdings in the investment portfolio of [name of organization]; (3) particular matters involving specific parties (specific party matters), such as grants, contracts, application approvals, specifically involve [name of organization] or otherwise affect its financial interest; or (4) other miscellaneous matters involving the conduct of the organization's affairs and Department support.
While performing, as an official duty activity, the usual and customary duties of the position of [an officer or a director or another position] of an outside organization, any actions taken, either in the federal workplace or at the organization, that affect the financial interest o the outside organization are deemed official matters to which section 208(a) may apply. For example, such actions may include: (1) requesting that official travel funds be spent or other government resources be utilized for the employee to conduct the affairs of the organization; (2) signing a training authorization to use agency funds to pay for a subordinate to attend a seminar or other meeting of the organization; (3) speaking as a official duty activity, or directing a subordinate to speak, at any seminar or other meeting of the organization where attendance fees are charged; (4) participating as an official duty activity in fundraising activities of the organization; or (5) providing advice and consultation with respect to, or otherwise conducting, the business affairs of the organization. While the financial impact may be insignificant, under well settled precedent, section 208(a) has no de minimis aspect.
Accordingly, if approved, the requested waiver will apply fully to the employee's participation in an official capacity in any particular matter that will directly and predictably affect the financial interest of [name of organization], EXCEPT the following particular matters, as to which [the employee] [has recused or has committed to recuse]:
[Identify particular matters to which the waiver is NOT intended to apply, e.g.., grants to or contracts with the outside organization. In unique circumstances, a waiver might be appropriate for participation in a grant, contract, or other specific party matter. But absent a strong justification, such matters are likely to be standard exceptions to this waiver for which a recusal will be required. If no exceptions are intended, state "None" at this point in the document and describe below the justification in detail.]
I believe that a waiver is justified for the following reasons:
First, because [the employee] would serve in [the outside organization] as an assigned official duty activity, there is a greatly diminished risk that the integrity of the services that the Government expects would be affected. [The employee's] position in the outside organization is fully known to the agency. Moreover, the agency already has determined that, to a significant degree, the interests of the Department and the interests of [the organization] are consonant; the agency expects that the interests of the Department and the interests of [the organization] both can be furthered through the performance of [the employee's] official duties.
Second, most if not all of the particular matters in which [the employee] would participate would not have a significant effect on the financial interests of [the organization]. [If the employee will have no involvement in any DOI grants, contracts or other financial support to the organization--other that the use of Government travel or training funds--and will not be involved in regulatory or investigatory matters having a significant financial impact on the organization, state this face here.]
[If the employee is expected to be involved in more problematic matters that involve funding of the organization or regulatory or investigatory matters that significantly affect the financial interests of the organization, a stronger justification for waiver would be needed. Such matters can pose a greater risk of a conflict of interest, and consequently the justification for a waiver in such cases would have to be explained in greater detail. Any information bearing o the magnitude of the financial impact (for example, the size of a grant or contract) would be relevant. Also, it may help to discuss any limits on the employee's's involvement in the matter (for example, whether the employee is subject to significant supervision or is only involved in a limited aspect of the matter). Moreover, if the general applicability, this should be noted, as such matters typically are less problematic.]
The employee understands and agrees that, as an official duty activity, no separate compensation may be received from the outside organization in connection with [his or her] service as its [officer, director or other position].
[State and other facts, commitments, terms, or conditions relevant to the appointing official's assessment of the request.]
DECISION:
__________ Waiver granted, subject to the terms and conditions stated above, based on my determination, made in accordance with 18 U.S.C. § 208(b)(1), that the disclosed financial interests are not so substantial as to be deemed likely to affect the integrity of the service which the Government may expect from the employee.
__________ Waiver denied.
Date:__________
Confirmed and Acknowledged:
Date:_________