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The "revolving door issue involves important considerations relating to the

public trust, effective public and private sector management of defense programs,

and the protection of individual freedoms. Congress has attempted over the years

to deal with the issue. Despite these efforts, due to occasional "horror stories"

there is a public perception that the problem continues. Any effective solution

must deal not only with perception but with the operational reality of the

problem, which thus far has escaped definition.

In view of the cost of

implementating H.R. 2554, The Academy recommends that the Committee ask the

GAO to study the issue and define the problem, including the effectiveness of

administration of current applicable law and regulation, and then decide just what

appropriate action by the Congress is required.

The Academy recommends that the numerous existing laws and regulations

on the subject be combined into a single, consolidated legislative framework. The

Academy can bring its unique resources to bear on any aspect of this issue.

Ray Kline

January 29, 1986








January 29, 1986

Mr. Chairman, Members of the Subcommittee:

It is my pleasure to respond to your invitation to the National Academy of

Public Administration to comment on H.R. 2554, the Defense Procurement

Conflict of Interest Act. The Academy, chartered by the Congress in 1984, is a private, non-profit, non-partisan organization of elected membership created in

1967 to conduct studies and provide advice on the problems of government. This

statement represents the views of a select panel of Academy members who have

had long and distinguished careers in the field of federal procurement.

The "revolving door" issue is a significant one involving important

considerations relating to the public trust, effective public and private sector

management of defense programs, and the protection of individual freedoms. The

Congress and the Executive have long recognized the significance of the issue and through the years have attempted to deal with it directly and indirectly through numerous laws, executive orders and regulations addressed to both the

procurement process and conflict of interest requirements.

Despite these efforts, occasional "horror stories" involving post-Federal

employment with contractors continue to be heard, and fuel a negative public

perception of the integrity of the defense contracting process. These perceptions

of wrongdoing not only erode citizens' confidence in government but temper their

willingness to support defense programs.

The continuing concern gave rise during the last session of Congress to the

passage of P.L.99-145 which places certain post-Federal employment restrictions on presidential appointees, and provides the backdrop for today's consideration of


The central question to be addressed concerning the efficacy of H.R.2554 is

whether it effectively addresses a real problem endemic to DOD procurement management. In view of the potential scope and cost of the proposed bill, it is

important to define with some specificity just what is the post-federal employment problem in defense contracting. The Academy panel has been unable

to find a clear articulation

in either the Executive or Legislative branch


the fundamental problem and therefore agrees with the following statement made

by the GAO to the Congress in a 1978 report, and repeated in a second report

dated June 10, 1985:

The extent to which a post-Federal employment
problem exists is not known, appropriate levels of
enforcement have not been determined, and little hard
data is available to determine whether or not existing
statutes and regulations are adequate to preclude post-
Federal employment problems or the appearance of such

In the absence of information as to the extent to which post-employment

problems exist, it is the Academy panel's view that the Congress ask the GAO to

undertake a comprehensive review of post-employment problems in defense contracting. The results of such a study could affirm that H.R. 2554 is right on

target. On the other hand, it could reveal that the area is adequately covered by

current law and regulation

that the problem is not one of the need for new law

as it is the need for improved administration of current law. Or there could be a

need for both new legislation and improved administration

not only in the

Defense establishment but in civilian agencies as well.

There is some evidence that the administration of current law and

regulation as related to "revolving door" and general conflict of interest may be in

need of some improvement. For example, the GAO in its June 1985 report on DOD defense-related post-government employment found great variations among

DOD agencies in meeting reporting requirements of Section 2397. For another

example, a brief examination of ethics program administration by Common Cause

in 1984 found great variations among the agencies and observed that in certain

cases post-employment restrictions tended to be limited or nonexistent.

To our knowledge, no comprehensive review of the implementation and

administration of relevant statutes and regulations has been made, and we believe

such a review should be part of the GAO study.

One hindrance to effective administration could be the very proliferation

of laws and regulations themselves, leading to the question as to whether it is

time to combine existing law into a single consolidated, legislative framework. A

consistent, comprehensive approach would ease both Executive administration and

Legislative oversight of the process.

The Academy panel recommends that

Congress undertake such a consolidation effort.

If the Committee decides to move ahead on the bill, despite the above considerations, the Academy panel would emphasize that, as currently drafted,

the bill would entail enormous costs for its administration

involving information

and trocking on thousands of DOD employees and large volumes of paper from the

DOD and contractors alike:

this at the same time that other Congressional

initiatives are being pursued to cut the costs of government and streamline its

processes. In consideration of the objectives of both H.R. 2554 and government

efficiency, the Committee may want to reexamine the thresholds for coverage in the bill. For example, should contracts covered by the bill remain at $100,000 or be raised to, say, $1,000,000? For example, should employee coverage be defined

solely by procurement function or should an arbitrary cut-off be established at an

appropriate management level, say, GS-14 for civilian employees and the

equivalent rank for military personnel? There is a strong possibility that the

objectives of the bill could be met at much lower cost by a careful, rigorous

examination and determination of appropriaie thresholds. But, again, setting

thresholds presupposes an understanding of the problem.

The Academy panel notes the provision for waiver of selected positions

under certain conditions from requirements of the bill. Such features underline

the importance of effective administration of the bill upon passage, as the

exercise of such waivers are important not only to the management of Defense

programs but to the "revolving door" perceptions of the average citizen and the

DOD workforce.

Another Academy panel, in its report on the Presidential

Appointee Project which reviewed Presidential appointments during the past five

Presidential administrations, recommended that a legislative ban be placed on the

solicitation or discussion of future employment in the private sector by any

Presidential appointee during the time of his or her appointment. Your committee

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