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Neither the provisions of the Advisory Committee Act nor the congressional committee reports on the legislation enacted as the Act elaborate on the phrase "any subcommittee or other subgroup" of an advisory committee. However, the words themselves suggest that an expansive application was intended. Also, the legislative history of the Act indicates that the basic definition of "advisory committee" was to be applied broadly:

"* * * it is well to establish the
meaning of the phrase in section 3(1) and
3(2) 'committees * ** established or
organized *** by any officer for the
purpose of furnishing advice. What kind
of committees would this bring into
coverage under the legislation? The
intention is to interpret the words
'established' and 'organized' in their
most liberal sense, so that when an
officer brings together a group by formal
or informal means, by contract or other
arrangement, and whether or not Federal
money is expended, to obtain advice and
information, such group is covered by the
provisions of this bill. * * ⭑"

2

The Commerce Department's Committee Management Handbook, which governs advisory committees established by or assigned to the Department, likewise gives broad coverage to the concept of advisory committee subcommittees or subgroups. Part II, chapter 1, section E of the Handbook "applies to any advisory committee subunit, whether it is to be identified as a subcommittee, task force, study team, panel, or subgroup, or by any other term, and whether it is temporary or permanent. This section of the Handbook further provides:

".03 Conditions of Utilization. Subcommittees can not be used to circumvent any of the objectives of the FACA [Federal

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1 S. Rep. No. 92-1098, at 8 (1972); see also, National Nutritional Foods Association v. Califano, 603 F.2d 327, 334-36 (2d Cir. 1979).

2 Section 8(a) of the Advisory Committee Act requires each Federal agency to establish uniform administrative guidelines and management controls for its advisory committees.

Advisory Committee Act]. The Activities,
and operations of subcommittees are subject
to the same rules and conditions that apply
to chartered parent committees as set forth
in the next chapter, 'Committee Activities
and Operations.""

II.

Against this background, it is necessary to consider the nature and functions of the 35 task forces and how they fit within the structure of the Survey.

The Executive Committee and other elements of the Survey.

Executive Order 12369, dated June 30, 1982, 47 Fed. Reg. 28899, established the Executive Committee of the President's Private Sector Survey as an advisory committee in the Department of Commerce. Section 2 of the Executive Order sets forth the following functions for the Executive Committee:

"(a) The Committee shall conduct a private
sector survey on cost control in the Fed-
eral Government and shall advise the Presi-
dent and the Secretary of Commerce, and
other Executive agency heads with respect
to improving management and reducing
costs.

"(b) The Committee shall conduct in-depth
reviews of the operations of the Executive
agencies as a basis for evaluating poten-
tial improvements in agency operations.

3 See also Part I, section G of the Handbook, which states:

"Subcommittees must be authorized and con-
trolled. They are subject to the same
policies, restraints, and requirements as
parent committees. Any proposed subcom-
mittee which would have a member who is not
on the parent committee must be separately
established as an individual committee.
Subcommittees can not be used to circumvent
requirements or responsibilities of the
parent committee."

"(c) In fulfilling its functions the Com-
mittee shall consider providing recommenda-
tions in the following areas:

"(1) Opportunities for increased efficiency and reduced costs in the Federal Government that can be realized by Executive action or legislation;

"(2) Areas where managerial accountability can be enhanced and administrative control can be improved;

"(3) Opportunities for managerial improvements over both the short and long term;

"(4) Specific areas where further study can be justified by potential savings; and

"(5) Information and data relating to governmental expenditures, indebtedness, and personnel management."

Section 3(a) of the Executive Order provides:

"The heads of Executive agencies shall,
to the extent permitted by law, provide to
the Secretary of Commerce, the Committee
and its staff units such information, in-
cluding that relating to the structure,
organization, personnel and operations of
the Executive agencies, as may be required
for carrying out the purposes of this
Order."

The Commerce Department's charter for the Executive Committee pursuant to the Advisory Committee Act, dated July 7, 1982, repeats the functions of the Committee as specified in section 2 of the Executive Order. It also includes the same provision as section 3(a) of the Executive Order concerning the furnishing of information to the Committee and its staff units. In addition, section 4 of the charter includes the following administrative provisions:

"(d) The Committee, or subcommittees thereof, is expected to meet at least monthly before the final report and recommendations are submitted to the President."

and

(g) The Committee may establish such

subcommittees of its members as may be
necessary, subject to the provisions of the
Department of Commerce Committee Management

Handbook ***."

In addition to the provisions establishing the Executive Committee and specifying its functions, the Executive Order contains several related administrative provisions. Section 3(c) authorizes a management office in support of the Executive Committee:

"A management office may provide overall administrative staff support to the Committee, guide the day-to-day operations of the Survey and provide liaison with the Executive Office of the President; separate unit staffs may be utilized to provide such staff support as is necessary to accomplish reviews of individual agencies."

Finally, section 3(e) of the Executive Order provides for a non-profit organization to support the Committee:

"(e) The Committee is to be funded,

staffed and equipped, to the extent practi-
cable and permitted by law, by the private
sector without cost to the Federal Govern-
ment. To accomplish this objective, it is
expected that the Secretary of Commerce
will engage in a joint project, with a non-
profit organization, pursuant to Section 1
of Public Law 91-412 (15 U.S.C. 1525), for
the purpose of providing staff support to
the Committee as described in Section
3(c)."

To implement this provision, the Foundation for the President's Private Sector Survey on Cost Control was established as a nonprofit corporation in the District of Columbia. The articles of incorporation state that the primary purpose of the Foundation is to assist the Private Sector Survey on Cost Control. This is to be accomplished by providing expert and professional services, office facilities, staff and other support services.

On July 7, 1982, the Commerce Department and the Foundation entered into an agreement for the provision of assistance by the Foundation to the Executive Committee. In section III of the agreement, the Foundation agrees at no cost to the Federal Government:

"(a) To provide such suport as may be requested by the Chairman of the Committee to assist the Committee in carrying out its responsibilities, including but not limited

to:

"(1) facilities, including office space, furniture, equipment, telephonic and computer equipment and services as may be necessary; and

"(2) staff support to the Committee
as may be necessary, and in connection
therewith to hire such employees and retain
such consultants and advisors, either with
or without compensation, as the Foundation
in its discretion shall deem necessary or
advisable."

Section IV of the agreement, captioned "Status of the Foundation," provides:

"The parties hereto acknowledge and
agree that the status of the Foundation
under this Agreement, and in all of its and
its employees agents and representatives
dealings and relations with the Secretary,
the Department of Commerce and other Fed-
eral agencies shall be that of an indepen-
dent entity providing services under a
joint project and not as one involving
employment, no statutes governing Federal
employment shall apply to the Foundation,
and the Foundation shall not have any obli-
gation of financial accountability to the
Department of Commerce."

The task forces.

The nature and functions of the task forces were described by Mr. Felix E. Larkin, a member of the Executive Committee, in his testimony of September 15, 1982, before your Subcommittee.

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