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Sec. 306. Each agency shall, at the time of employment of a consultant, adviser, or other special Government employee require him to supply it with a statement of all other employment. The statement shall list the names of all the corporations, companies, firms, State or local governmental organizations, research organizations and educational or other institutions in which he is serving as employee, officer, member, owner, director, trustee, adviser, or consultant. In addition, it shall list such other financial information as the appointing department or agency shall decide is relevant in the light of the duties the appointee is to perform. The appointee may, but need not, be required to reveal precise amounts of investments. The statement shall be kept current throughout the period during which the employee is on the Government rolls.

PART IV-REPORTING OF FINANCIAL INTERESTS

SECTION 401. (a) Not later than 90 days after the date of this order, the head of each agency, each Presidential appointee in the Executive Office of the President who is not subordinate to the head of an agency in that Office, and each full-time member of a committee, board, or commission appointed by the President, shall submit to the Chairman of the Civil Service Commission a statement containing the following:

(1) A list of the names of all corporations, companies, firms, or other business enterprises, partnerships, nonprofit organizations, and educational or other institutions

(A) with which he is connected as an employee, officer, owner, director, trustee, partner, adviser, or consultant; or

(B) in which he has any continuing financial interests, through a pension or retirement plan, shared income, or otherwise, as a result of any current or prior employment or business or professional association; or

(C) in which he has any financial interest through the ownership of stocks, bonds, or other securities. (2) A list of the names of his creditors, other than those to whom he may be indebted by reason of a mortgage on property which he occupies as a personal residence or to whom he may be indebted for current and ordinary household and living expenses.

(3) A list of his interests in real property or rights in lands, other than property which he occupies as a personal residence.

(b) Each person who enters upon duty after the date of this order in an office or position as to which a statement is required by this section shall submit such statement not later than 30 days after the date of his entrance on duty.

(c) Each statement required by this section shall be kept up to date by submission of amended statements of any changes in, or additions to, the information required to be included in the original statement, on a quarterly basis

SEC. 402. The Civil Service Commission shall prescribe regulations, not in. consistent with this part, to require the submission of statements of financial interests by such employees, subordinate to the heads of agencies, as the Commission may designate. The Commission shall prescribe the form and content of such statements and the time or times and places for such submission.

SEC. 403. (a) The interest of a spouse, minor child, or other member of his immediate household shall be considered to be an interest of a person required to submit a statement by or pursuant to this part.

(b) In the event any information required to be included in a statement re. quired by or pursuant to this part is not known to the person required to submit such statement but is known to other persons, the person concerned shall request such other persons to submit the required information on his behalf.

(c) This part shall not be construed to require the submission of any information relating to any person's connection with, or interest in, any professional society or any charitable, religious, social, fraternal, educational, recreational, public service, civic, or political organization or any similar organization not conducted as a business enterprise and which is not engaged in the ownership or conduct of a business enterprise.

SEC. 404. The Chairman of the Civil Service Commission shall report to the President any information contained in statements required by section 401 of this part which may indicate a conflict between the financial interests of the official concerned and the performance of his services for the Government. The Commission shall report, or by regulation require reporting, to the head of the agency concerned any information contained in statements submitted pursuant to regulations issued under section 402 of this part which may indicate a conflict between the financial interests of the officer or employee concerned and the performance of his services for the Government.

SEC. 405. The statements and amended statements required by or pursuant to this part shall be held in confidence, and no information as to the contents thereof shall be disclosed except as the Chairman of the Civil Service Commission or the head of the agency concerned may determine for good cause shown.

SEC. 406. The statements and amended statements required by or pursuant to this part shall be in addition to, and not in substitution for, or in derogation of, any similar requirement imposed by law, regulation, or order. The submission of a statement or amended statements required by or pursuant to this part shall not be deemed to permit any person to participate in any matter in which his participation is prohibited by law, regulation, or order.

PART V-DELEGATING AUTHORITY OF THE PRESIDENT UNDER SECTIONS 205 AND 208

OF TITLE 18 OF THE UNITED STATES CODE RELATING TO CONFLICTS OF INTEREST

SECTION 501. As used in this part, department means an executive department, agency means an independent agency or establishment or a Government corporation, and head of an agency means, in the case of an agency headed by more than one person, the chairman or comparable member of such agency.

SEC. 502. There is delegated, in accordance with and to the extent prescribed in sections 503 and 504 of this part, the authority of the President under sections 205 and 208 (b) of title 18, United States Code, to permit certain actions by an officer or employee of the Government, including a special Government employee, for appointment to whose position the President is responsible.

SEC. 503. Insofar as the authority of the President referred to in section 502 extends to any appointee of the President subordinate to or subject to the chairmanship of the head of a department or agency, it is delegated to such department or agency head.

SEC. 504. Insofar as the authority of the President referred to in section 502 extends to an appointee of the President who is within or attached to a department or agency for purposes of administration, it is delegated to the head of such department or agency.

SEC. 505. Notwithstanding any provision of the preceding sections of this part to the contrary, this part does not include a delegation of the authority of the President referred to in section 502 insofar as it extends to :

(a) The head of any department or agency in the executive branch;

(b) Presidential appointees in the Executive Office of the President who are not subordinate to the head of an agency in that Office; and

(c) Presidential appointees to committees, boards, commissions, or similar groups established by the President.

PART VI-PROVIDING FOR THE PERFORMANCE BY THE CIVIL SERVICE COMMISSION OF

CERTAIN AUTHORITY VESTED IN THE PRESIDENT BY SECTION 1753 OF THE REVISED STATUTES

SECTION 601. The Civil Service Commission is designated and empowered to perform, without the approval, ratification, or other action of the President, so much of the authority vested in the President by section 1753 of the Revised Statutes of the United States (5 U.S.C. 631) as relates to establishing regulations for the conduct of persons in the civil service.

SEC. 602. Regulations issued under the authority of section 601 shall be consistent with the standards of ethical conduct provided elsewhere in this order.

PART VII-GENERAL PROVISIONS

SECTION 701. The Civil Service Commission is authorized and directed, in addition to responsibilities assigned elsewhere in this order:

(a) To issue appropriate regulations and instructions implementing parts II, III, and IV of this order;

(b) To review agency regulations from time to time for conformance with this order; and

(c) To recommend to the President from time to time such revisions in this order as may appear necessary to ensure the maintenance of high ethical standards within the executive branch.

SEC. 702. Each agency head is hereby directed to supplement the standards provided by law, by this order, and by regulations of the Civil Service Commission with regulations of special applicability to the particular functons

and activities of his agency. Each agency head is also directed to assure (1) the widest possible distribution of regulations issued pursuant to this section and (2) the availability of counseling for those employees who request advice or interpretation.

SEC. 703. The following are hereby revoked:

(a) Executive Order No. 10939 of May 5, 1961.

(b) Executive Order No. 11125 of October 29, 1963.

(c) Section 2(a) of Executive Order No. 10530 of May 10, 1954.

(d) White House memorandum of July 20, 1961, on Standards of Conduct for Civilian Employees.

(e) The President's Memorandum of May 2, 1963, Preventing Conflicts of Interest on the Part of Special Government Employees. The effective date of this revocation shall be the date of issuance by the Civil Service Commission of regulations under section 701 (a) of this order.

SEC. 704. All actions heretofore taken by the President or by his delegates in respect of the matters affected by this order and in force at the time of the issuance of this order, including any regulations prescribed or approved by the President or by his delegates in respect of such matters, shall, except as they may be inconsistent with the provisions of this order or terminate by operation of law, remain in effect until amended, modified, or revoked pursuant to the authority conferred by this order.

SEC. 705. As used in this order, and except as otherwise specifically provided herein, the term agency means any executive department, or any independent agency or any Government corporation; and the term employee means any officer or employee of an agency.

LYNDON B. JOHNSON.

THE WHITE HOUSE, May 8, 1965.

Representative BROWN. Are those people required to disclose to individual companies?

Mr. INK. You are talking about the GSA?

Representative BROWN. Yes.

Mr. INK. I would suggest you ask them as to what their disclosure policy is.

Representative BROWN. The reason I pursue this kind of questioning is that this is an area where the product is a highly tailored and not open for generalized bidding; doesn't the decision to purchase or rent a computer depend to a large degree on the discretion of the people who make the request and approve it?

Mr. INK. Yes, sir.

Well, except that the dollars, the availability of dollars, of course, go through this budget process.

For example, when I was in HUD we forwarded a request for a computer, and the estimate, it had a $5 million price tag on it. Now had we come forward with something else with a $5 million price tag on it that would have been also reviewed by the Bureau. Now something that is in the neighborhood of $20,000 isn't, as an item.

I might say also that none of the three of us here own any stock in any computer company.

Representative BROWN. That is comforting.

The only point I make, Mr. Ink, and I am sure you appreciate this, is that if you were in private business and put in a request for a $5 million computer somebody would say, "are you going to save $5 million or are we going to make $5 million on the computer over a reasonable period of time," and I trust that is the general responsibility of the Bureau of the Budget.

Mr. INK. Yes, sir.

Representative BROWN. As to whether or not some similar type of judgment is made.

Mr. INK. Yes, sir.

Representative BROWN. But unfortunately not squared on the same requirement.

Mr. INK. In that instance that I mentioned, for example, when I was then in the department we had to provide justification to the Bureau first for the need for the computer and the timing of that need. They raised very severe questions with us as to whether our program would move along at the pace that we estimated and, therefore, required the computer at that date. They fairly soon were convinced that we needed the computer but they were unconvinced for some time that we needed it when we said we needed it, and they asked for and received the analysis with respect to purchase versus lease.

All of that was preliminary to the hearings that we had at the Bureau of the Budget in which this was one of several items that was taken up with the Bureau.

Representative BROWN. If I can go on with my analogy, purchasing department in private industry usually buys the least expensive shelf item available or buys on a bid basis; however, if the item must be tailored there will be some decision as to where the item is to be acquired-such factors as business relationships, family relationships, et cetera, often enter into the decision. I am trying to determine how much these type of factors enter into the purchase of computers by GSA.

Perhaps we will have a chance to pursue it with them.
Mr. INK. Yes.

LOCATION OF COMPUTERS BY DEPARTMENTS

Representative BROWN. What is the book inventory breakdown of the numbers of computers in the Government; do you have a breakdown as to the departmental location of those computers?

Mr. CUNNINGHAM. Yes, sir.

Representative BROWN. The agencies and so forth.

Mr. INK. Yes, sir; it is included here.

Representative BROWN. Do you have a breakdown as to the utilization or is there any way that you have been able to follow up on the utilization of the computers as to whether or not the requests for purchase or rental of the computer proved to be accurate? Do you know, to put it another way, how many times you have been conned?

INVENTORY SHOWS HOURS OF SERVICE

Mr. INK. Well, the inventory report itself includes one index to this in the average monthly hours in service. Now that is only a part of the analysis, of course, but I think that is a very useful and important tangible proof.

Representative BROWN. Does that vary widely?

Mr. INK. Yes, sir.

Representative BROWN. What would be the high monthly hours versus the low monthly hours of service?

Mr. INK. Well, just looking here at one of the sheets, I see this particular page ranged from about 652 hours down to 98 hours. That is the kind of range that I see on this particular page.

Representative BROWN. Presumably then, somebody who had 652 hours of service on their computer would have a need for a computer that would be greater than somebody who had a computer that they used for only 98 hours, is that a fair or an unfair statement?

Mr. INK. Generally, yes. But, of course, some areas have higher priorities than others, and some high-priority problems don't take a lot of hours, might be in the smaller numbers. Mr. Renninger is just telling me that the average for small computers is 295 and 512 for the largest computers, if that helps give you a range. I don't have a median figure.

Representative BROWN. What is that figure again; what is the 295 and the 512?

Mr. INK. Well, first, I just at random opened one of the pages of the inventory and gave you the range on that particular page of the utilization that was reported. Mr. Renninger then is saying that an overall average, this is not the median, an overall average for small computers is 295, and for the largest computers 512.

Representative BROWN. But again, what is the 295 figure?

Mr. INK. Hours per month.

Mr. CUNNINGHAM. Productive hours per month.

Mr. INK. Productive hours per month, that is what all these figures are that I have been reciting.

Representative BROWN. That is nearly round the clock use then, is that right?

Mr.INK. Yes.

Representative BROWN. Presumably you only have 720 hours a

month?

Mr. INK. Yes, sir; it does and we would hope it would on these larger ones.

Mr. Chairman, I think that what we have talked about, what the General Accounting Office has talked about, represent some significant steps forward in terms of better information and better control. I think we are all in agreement that this is a part of the story. There certainly are steps that need to be taken and some of those that we are in the midst of taking we think we ought to be moving ahead on more rapidly.

Chairman PROXMIRE. Well, thank you very, very much, gentlemen. This is most helpful. I didn't mean to be too critical of you personally at all. I know that, after all, you are relatively new and your office is brand new, this is the first day, as you said, and so Happy Fiscal Year.

Mr. INK. We hope to improve, Mr. Chairman.

Chairman PROXMIRE. Well, I am sure you will do that.

(Laughter.)

So the subcommittee will stand in recess until 2 this afternoon when we have the General Services Administration, Department of Defense, and the Peripheral Manufacturers Association represented.

(Whereupon, at 12:55 p.m., the subcommittee was recessed, to reconvene, at 2 p.m., the same day.)

Afternoon Session

Chairman PROXMIRE. At the suggestion of Mrs. Griffiths, and I think it would be helpful, is Mr. Caveney here at the moment? Won't

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