[Federal Register Volume 67, Number 156 (Tuesday, August 13, 2002)]
[Rules and Regulations]
[Pages 52595-52597]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-20435]



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Rules and Regulations
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Federal Register / Vol. 67, No. 156 / Tuesday, August 13, 2002 / 
Rules and Regulations

[[Page 52595]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 451

RIN 3206-AJ65


Awards

AGENCY: Office of Personnel Management.

ACTION: Interim rule.

-----------------------------------------------------------------------

SUMMARY: The Office of Personnel Management (OPM) is issuing interim 
regulations to amend the rules governing Presidential Rank Awards to 
implement the Treasury and General Government Appropriations Act of 
2002 which extends eligibility for Presidential Rank Awards to certain 
senior career employees. The regulations also incorporate existing 
requirements pertaining to rank awards for career members of the Senior 
Executive Service (SES) currently found in guidance that OPM provides 
annually to agencies and previously included in the former Federal 
Personnel Manual. The amendments will also enhance the clarity of the 
regulations and improve readability.

DATES: Effective Date: The interim regulations are effective on 
September 12, 2002.
    Comments Date: Comments must be received on or before October 15, 
2002.

ADDRESSES: Send or deliver written comments to Joyce Edwards, Director, 
Office of Executive Resources Management, U.S. Office of Personnel 
Management, 1900 E Street NW., Room 6484, Washington, DC 20415.

FOR FURTHER INFORMATION CONTACT: Anne Kirby, (202) 606-1610, or e-mail 
to [email protected].

SUPPLEMENTARY INFORMATION: The regulations amend part 451 to add a new 
subpart, subpart C--Presidential Rank Awards. This new subpart 
incorporates current requirements for awards for members of the Senior 
Executive Service (SES) found in subpart B--Presidential Awards, as 
well as new requirements for awards for senior career employees.

Background

    Each year, the President may award the ranks of Distinguished 
Executive and Meritorious Executive to a small select group of career 
members of the Senior Executive Service (SES) to recognize sustained, 
extraordinary leadership accomplishments. The Office of Personnel 
Management administers the rank award program for the President. Agency 
heads submit nominations for rank awards to OPM, which reviews the 
nominations and recommends to the President which nominees should 
receive the awards, in accordance with 5 U.S.C. 4507 and regulations 
currently at 5 CFR part 451, subpart B. Section 4506 of title 5 
authorizes OPM to prescribe regulations and instructions to implement 
the Presidential Rank Awards program.

Ranks for Senior Career Employees

    Section 641 of the Treasury and General Government Appropriations 
Act of 2002 (Pub. L. 107-67, enacted 11-12-01) extended eligibility for 
Presidential Rank Awards to certain senior career employees. This new 
provision is codified in a new section of Chapter 45 of title 5 (5 
U.S.C. 4507a). The public law defines a ``senior career employee'' as 
an individual appointed to a position classified above GS-15 and paid 
under 5 U.S.C. 5376, who is not serving under a time-limited 
appointment or in a position that is excepted from the competitive 
service because of its confidential or policy-making character. Senior 
career employees are individuals who occupy Senior-Level (SL) or 
Scientific-Professional (ST) positions.
    Agency heads may nominate senior career employees to be awarded the 
ranks of Distinguished Senior Professional for sustained extraordinary 
accomplishment and Meritorious Senior Professional for sustained 
accomplishment in a manner similar to the nominations of career members 
of the SES.
    In accordance with 5 U.S.C. 4507a, the regulations establish basic 
eligibility criteria that are consistent with criteria long-established 
for the SES. These eligibility requirements are: (1) Hold a career 
appointment in a Senior-Level (SL) or Scientific-Professional (ST) 
position that is subject to OPM position allocations under part 319 and 
paid under 5 U.S.C. 5376 on the nomination deadline set by OPM; (2) be 
an employee of the nominating agency on the nomination deadline set by 
OPM; and (3) have at least 3 years of career or career-type Federal 
civilian service above GS-15. Individuals who have been awarded a 
Distinguished or Meritorious rank are not entitled to receive the same 
rank during the next 4 fiscal years. In addition, the Governmentwide 
number of career senior employees awarded the rank of Distinguished 
Senior Professional may not exceed 1 percent of the total number of 
career appointees to OPM-allocated Senior-Level (SL) and Scientific-
Professional (ST) positions, and the number awarded the rank of 
Meritorious Senior Professional is limited to 5 percent of the total 
number of career appointees to OPM-allocated Senior-Level (SL) and 
Scientific-Professional (ST) positions.
    As with SES nominations, agencies may nominate up to 9 percent of 
their career senior employees for rank awards. Generally, there should 
be no more than one Distinguished nominee from an agency for every five 
Meritorious nominees, in keeping with the proportion of awardees 
allowed Governmentwide.
    Senior career employees receiving the Distinguished rank award will 
receive a lump-sum payment of 35 percent of basic pay; those receiving 
the Meritorious rank award will receive a lump-sum payment of 20 
percent of basic pay.
    Senior career employees will be eligible for rank awards beginning 
with awards granted by the President in 2003.

Ranks for Members of the Senior Executive Service

    The regulations incorporate existing eligibility and other 
requirements for career members of the SES currently found in guidance 
and instructions that OPM provides annually to agencies on rank award 
nominations and that was previously included in the former Federal 
Personnel Manual, Supplement 920-1. Although agencies are required 
under 5 U.S.C. 4506 to comply with OPM regulations and instructions on 
award programs, we have decided to

[[Page 52596]]

place all requirements in regulation. This is a more compact and 
effective way to convey the requirements and may avoid 
misinterpretations.
    The basic eligibility requirements are: (1) The SES appointee must 
hold a career appointment in the SES on the nomination deadline set by 
OPM; (2) the nominee must be an employee of the nominating agency on 
the nomination deadline set by OPM; and (3) the nominee must have at 
least 3 years of career or career-type Federal civilian service at the 
SES level. Qualifying service includes appointments in the SES, Senior 
Foreign Service, the Defense Intelligence Senior Executive Service, and 
similar senior executive systems. Qualifying service does not include 
noncareer, limited term, or limited emergency appointments in the SES 
or their equivalent, Scientific and Professional (ST) appointments, or 
Senior-Level (SL) appointments.
    The number of Distinguished and Meritorious rank recipients is 
limited Governmentwide to a total of 6 percent of the career SES, but 
there is no statutory limit on the number of recipients by agency. In 
order to provide adequate competition, agencies may nominate up to 9 
percent of their career SES appointees for rank awards.

Table of Changes

    The following table lists the changes to the current regulations. 
The ``current rule'' column lists the regulations in the current 
subpart B affected by the interim regulations. The ``interim rule'' 
column shows the disposition of the current rules and new rules in the 
new subpart C. The third column explains the changes.

------------------------------------------------------------------------
         Current rule              Interim rule    Explanation of change
------------------------------------------------------------------------
451.201(c)....................  451.301(a).......  Moves current SES
                                                    provisions from
                                                    subpart B to the new
                                                    subpart C;
                                                    redesignates
                                                    remaining paragraphs
                                                    in 451.201.
451.203(a)....................  451.305(a) and     Moves current OPM
                                 (b).               responsibilities for
                                                    reviewing rank award
                                                    nominations and
                                                    making
                                                    recommendations to
                                                    the President from
                                                    subpart B to the new
                                                    subpart C; separates
                                                    the responsibilities
                                                    into two paragraphs;
                                                    and redesignates
                                                    remaining paragraphs
                                                    in 451.203.
                                451.301(b) and     Incorporates in
                                 (c).               regulation existing
                                                    SES rank award
                                                    eligibility
                                                    requirements. These
                                                    requirements have
                                                    been included in
                                                    annual rank award
                                                    guidance and
                                                    instructions to
                                                    agencies and were
                                                    included in the
                                                    former FPM
                                                    Supplement 92-1.
                                451.302(a).......  Implements new
                                                    statutory provisions
                                                    for rank awards for
                                                    senior career
                                                    employees.
                                451.302(b) and     Provides rank award
                                 (c).               eligibility
                                                    requirements for
                                                    senior career
                                                    employees.
                                                    Requirements are
                                                    consistent with
                                                    those for SES
                                                    members.
                                451.303..........  Implements statutory
                                                    restrictions on
                                                    awards for SES
                                                    appointees and
                                                    senior career
                                                    employees, including
                                                    Governmentwide
                                                    limits on the number
                                                    of awards that the
                                                    President may grant
                                                    each year and limits
                                                    on how often
                                                    individual employees
                                                    can receive awards.
                                451.304..........  Implements statutory
                                                    provisions for
                                                    paying rank awards,
                                                    including individual
                                                    award amounts and
                                                    compliance with
                                                    annual aggregate
                                                    compensation limits.
------------------------------------------------------------------------

Waiver of Notice of Proposed Rulemaking

    I find that good cause exists to waive the general notice of 
proposed rulemaking. These regulations implement section 641 of Public 
Law 107-67, which mandates that the amendments shall take effect for 
awards granted in 2003. Implementing regulations must be published and 
supplemental guidance issued to agencies before OPM invites agency 
heads to submit nominations for the 2003 rank awards. The invitations 
are issued annually, in July or August, in order to give agencies 
maximum time to carefully evaluate and select nominees and prepare 
supporting documentation. Agency head nominations for the 2003 awards 
will be due to OPM in January 2003. The waiver of proposed rulemaking 
is necessary to ensure timely implementation of the law as intended by 
Congress.

E.O. 12866, Regulatory Review

    This interim rule has been reviewed by the Office of Management and 
Budget in accordance with Executive Order 12866.

Regulatory Flexibility Act

    I certify that these regulations will not have a significant 
economic impact on a substantial number of small entities because the 
regulations pertain only to Federal employees and agencies.

List of Subjects in 5 CFR Part 451

    Decorations, medals, awards, Government employees.

Office of Personnel Management.

Kay Coles James,
Director.

    Accordingly, OPM is amending 5 CFR part 451 as follows:

PART 451--AWARDS

    1. The authority citation for part 451 continues to read as 
follows:

    Authority: 5 U.S.C. 4302, 4501-4509, E.O. 11438, 12828.

Subpart B--Presidential Awards


Sec. 451.201  [Amended]

    2. Section 451.201 is amended by removing paragraph (c) and 
redesignating paragraphs (d) and (e) as paragraphs (c) and (d), 
respectively.


Sec. 451.203  [Amended]

    3. Section 451.203 is amended by removing paragraph (a) and 
redesignating paragraphs (b) and (c) as paragraphs (a) and (b), 
respectively.

    4. Subpart C--Presidential Rank Awards is added to read as follows:

Subpart C--Presidential Rank Awards

Sec.
451.301  Ranks for the Senior Executive Service.
451.302  Ranks for senior career employees.
451.303  Restrictions.
451.304  Payment of Rank Awards.
451.305  Responsibilities of the Office of Personnel Management.


Sec. 451.301  Ranks for the Senior Executive Service.

    (a) The circumstances under which the President may award the rank 
of

[[Page 52597]]

Distinguished Executive and Meritorious Executive to a Senior Executive 
Service (SES) career appointee are set forth in 5 U.S.C. 4507.
    (b) To be eligible for a rank award, a senior executive must:
    (1) Hold a career appointment in the SES, as defined at 5 U.S.C. 
3132(a)(4), on the nomination deadline set by OPM;
    (2) Be an employee of the agency, as defined at 5 U.S.C. 
3132(a)(1), on the nomination deadline set by OPM; and
    (3) Have at least 3 years of career or career-type Federal civilian 
service at the SES level. Service need not be continuous.
    (i) Qualifying service includes appointments in the SES, the Senior 
Foreign Service, the Defense Intelligence Senior Executive Service, and 
similar senior executive systems.
    (ii) Qualifying service does not include noncareer, limited term, 
or limited emergency appointments in the SES or their equivalent, 
Scientific and Professional (ST) appointments, and Senior-Level (SL) 
appointments.
    (c) Each agency may nominate up to 9 percent of its SES career 
appointees for rank awards.


Sec. 451.302  Ranks for senior career employees.

    (a) The circumstances under which the President may award the rank 
of Distinguished Senior Professional and Meritorious Senior 
Professional to a senior career employee are set forth in 5 U.S.C. 
4507a.
    (b) To be eligible for a rank award, a senior career employee must:
    (1) Hold a career appointment in a Senior-Level (SL) or Scientific-
Professional (ST) position that is subject to OPM position allocations 
under part 319 of this chapter and paid under 5 U.S.C. 5376 on the 
nomination deadline set by OPM;
    (2) Be an employee of the agency on the nomination deadline set by 
OPM; and
    (3) Have at least 3 years of career or career-type Federal civilian 
service above GS-15. Service need not be continuous. Qualifying service 
includes appointments that are not--
    (i) Time-limited; or
    (ii) To positions that are excepted from the competitive service 
because of their confidential or policy-making character.
    (c) Each agency may nominate up to 9 percent of its career senior 
employees for rank awards.


Sec. 451.303  Restrictions.

    (a) Governmentwide limitations--SES. During any fiscal year--
    (i) The number of career SES appointees awarded the rank of 
Meritorious Executive may not exceed 5 percent of the career SES; and
    (ii) The number of career SES appointees awarded the rank of 
Distinguished Executive may not exceed 1 percent of the career SES.
    (b) Governmentwide limitations--Senior career employees. During any 
fiscal year--
    (i) The number of career senior employees awarded the rank of 
Meritorious Senior Professional may not exceed 5 percent of the total 
number of career appointees to OPM-allocated Senior-Level (SL) and 
Scientific-Professional (ST) positions; and
    (ii) The number of career senior employees awarded the rank of 
Distinguished Senior Professional may not exceed 1 percent of the total 
number of career appointees to OPM-allocated Senior-Level (SL) and 
Scientific-Professional (ST) positions.
    (c) Frequency of awards. Individuals awarded a Distinguished or 
Meritorious rank under this subpart shall not be entitled to be awarded 
that rank during the following 4 fiscal years.


Sec. 451.304  Payment of Rank Awards.

    (a) Receipt of the Distinguished rank by an SES career appointee or 
a career senior employee entitles the individual to a lump-sum payment 
of an amount equal to 35 percent of annual basic pay, which shall be in 
addition to the basic pay paid under 5 U.S.C. 5376 or 5382, or any 
award paid under 5 U.S.C. 5384.
    (b) Receipt of the Meritorious rank by an SES career appointee or a 
career senior employee entitles such individual to a lump-sum payment 
of an amount equal to 20 percent of annual basic pay, which shall be in 
addition to the basic pay paid under 5 U.S.C. 5376 or 5382, or any 
award paid under 5 U.S.C. 5384.
    (c) Payment of rank awards must comply with the restrictions on 
annual aggregate compensation at 5 U.S.C. 5307.


Sec. 451.305  Responsibilities of the Office of Personnel Management.

    (a) Annually, OPM shall establish criteria, including terms, 
conditions, and evaluation factors, for rank award nominations, in 
consultation with agencies and other stakeholders. Agencies shall 
nominate individuals for rank awards in accordance with OPM criteria 
and any other instructions.
    (b) Annually, OPM shall review agency recommendations for 
Presidential Rank Awards for SES career appointees and senior career 
employees under 5 U.S.C. 4507 and 4507a, and recommend to the President 
which of those individuals should receive rank awards.
[FR Doc. 02-20435 Filed 8-12-02; 8:45 am]
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