AGENCY EMPLOYMENT OF INTERMITTENT CONSULTANTS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80B01676R003100190015-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 9
• Document Creation Date: December 15, 2016
• Document Release Date: February 28, 2003
• Sequence Number: 15
• Publication Date: October 16, 1952
• Content Type: MF

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ILLEGIB
1?E2ORA1DU14 FOR: Deputy Director of Central Intelligence
SUBJECT Agency Employment of Intermittent Consultants
1. This memorandum is for information only.
2. In accordance with a request by the Director for information as
to the adequacy of Agency controls relating to the employment and payment
of consultants, a detailed review of this matter is attached as Tab A.
3. In summary, this review indicates that:
a. Adequate controls are in effect relating to the
appointment of consultants.
b. Mare effective control (mild be exercised over
the actual utilisation of consultants after re-
for their employment have been proved
by the Director. Ceder present practice elaims
for permeate to consultants are epproved at
various organisational level. 4reemnoh as Agency
regulatione do not call for approval at amy
'pacific level. In order to assure proper evalu-
ation of the utilisation of consultants, we pro.
pose that hereafter duty status reports used to
scOPOrt permeate to consultants be reviewed and
approved by officials at the level of Operating
Officials 9r higher. Operating Officials are
25X1 defined ml as "officials reporting
directly to a Deputy Director".
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and
._,i; .Tfi-Ation
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Agency Smployment of Intermittent Consultants
11.. A proposal will be :sada by this Office to niasact currant procedures
to require that pe;yments to consultants be based on the certification of
an official of at least the level of an mOperating Official.
Attachments:
Tsb A
Attachment to Tab A
ICUR:
Isl
Ice o
aral Counsel
mili.101.61111.????????.????????1????????111.
Dep?ty Dire CSuppoi7.-t)
Colgptr oiler
1 6 OCT 19?
Date
...11110.1.????110111.4.01MINIF
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c. When security clearances and conflict of interest certifications are
favorable, the Off toe of Personnel requests the individual to sign
a partonal service contract and an eppointeent affidavit. Apersonnel
action is then 'roared and authentioeted which formally eppoints the
individual as a consultant except that instead of issuing personnel
tions for some individuals engaged as consultants who are reeetrtog
Oderal retirement tmnefits, their services are contracted for as
independent contractors" an a, "par consultation* basis to avoid the
necessity for reductions in their retirement annuities (see General
Counsel Opinion 9-1136, dated 21 JUly1959, Subject: Employment of
Intermittent Consultants (copy attached)).
d, Agency regulations also require that Deprqr Directors review sanually,
during the month of May, the use and frequency of use of individual
consultants under their jurisdiction and make recommendations for the
retention or termination of indtvidual consultants. Regulations are
now being revised in conformance with the requirements of a Presi-
dential memorandum dated 9 Valoruiry 1962 in regard to the time limi-
tations on appointments of consultants and the matter of conflict
of interest.
s. The number of consultants employed by the Agency as or 1 July 1962
bin each major comonent and the first organizational level below
of major component is shown below;
Office of the Director
Deputy Director (Support)
Office of Training
Deputy Director (Plans)
Development Projects Division
Tethnical Servicen
Deputy Director (Intelligence)
Office of Current Reports
Office of National Nati:mates
Office of Operations (Content Division)
Office of Research and Reports
Office of Scientific Intelligence
Total
f. Some consultants are paid from voushered funds and some are paid from
confidential funds. Basically the procedures are as follows;
(1) After a consultant has been usad a duty status report is
prepared thawing the dates for which payment is requested.
The following certification, over the signature of the
consultant, is either typed, rubber stamped, or stepled
to the performance report;
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1 certify that for the dgys covered by this
report, during which I was employed, I he not
received nor will I elate ccapensation from any
other Government agency.''
(2) Agency regulations do not epecifically call for any Approval of
Claim for payments to consultants. For contmltants paid from
vouchered funds, claims are approved by the time and attendance
clerk for the component to which the consultant's pay will be
charged. Claims for consultants paid from confidential funds
are Approved at various erganizational levels, such as by the
Chief of Branch or his Deputy, the Case Officer, Personnal
Officer, Administrative Officer, or secretary to the Chief
of Division.
Crcl944;51?5
Agency procedures relative to the emplcorment and payment of consultants
Appear adequate except for the absence of a regulatory revirement
providing for approval of claim, for payment covering the utilization
of consultants. It is believed that in order to assure appropriate
evaluation of the utilization of the consultants claim for payments
Should be approved by the Operating Official of ihe component concerned.
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TTIOTION:
OBJECT:
Director of Personnel
Contract Personnel Division
Nmployment of General Lucian Truscott, Jr., USA
Bet.), sad as Intermittent
Consultants
WC 9-1136
July 19:52
1. It has come to the attention of this Office that it is proposed to
have General Truscott, who retired from the Agency 30 June 1959, serve an an
intermittent consultant. We are advised that he is in receipt of both retired
pay as a General and of an annuity under the Civil Service Retirement Act.
It is desired, if possible, to insure that the terms of his contract as a
consultant are such that there will be no legal objection to the receipt of
consultant fees in addition to the retired pay and the annuity referred to.
STAT we are also advised that retired, at the close of business 10
June 1959 and is in receipt of an annuity under the Civil Service Betirameht
Act. His situation with respect to the annuity is the same ialprinciple as
that of General Ttuscott and consequently they will be treated as one
problem.
2. Regarding the retired pay as a General, the unpublished decision of
the Corptroller General (B-105/07) dated October 19, 1951, referring to the
STAT situation of Vice Adnd.ral I U.S.N. (Het.), is pertinent and well
known to the Agency. In holding that Adm. was entitled to retain his
retired pay in addition to the fees received from his empLayment with this
Agency the Comptroller General stated in part:
"A copy of Admiral It4174.;ALcontract of empl e
oyment nclosed
with your letter reveals was employed as an intermittent
consultant 'to consult with the National Batimates Board as &
specialist in armed service (primarily naval) aspects of national
intelligence estimates,' and that his rate of compensation is
fixed at .50 per consultation.
"It informally has been ascertained from the Central Intelli-
gence Agency that the consultant services oil
I when
called upon from time to time are purely advisory and rather
STAT
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STAT
STAT
STAT
STAT
STAT
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infrequent. Also, that such consultations normally do not reqnire
more than one day but in the event they should extend ever into the
next day, the Admix*" would only be entitled to one fee of OD.
Clearly, therefore, the employment ofl lis predicated
upon a fee basis rather than a time basis and that factor together
with the other circumetances of his employment is not to be regarded
as a 'civilian office or position' within the meaning of section
212 of the Nconomy Act of 1932, supra."
It is observed from file that the terms of his personal.
service contract provide, in sceoroance with the wording of the Comptroller
General's decision, that he shall be paid as an "Intermittent Consultant"
at a rate of $0 per consultation rather than per day or fraction thereof.
If General Trustott * contract were to be similarly vordee, we would perceive
no possible legal objection to the receipt of his retired pay es a General
in addition to consultant fees from the Agency. We place particular
eMbaSis an thiS, not only because as a Government agency we 'would Wish to
comply strictly with the Comptroller General's opinion but because it Is our
consultant, the retired. officer himself, who will be ultimately and unneces-
sarily embarrassed by any failure to so comply. In addition; the activities
of retired officers, particularly general officers, are presently receiving
close scrutiny and wide publicity.
3. We will now consider 'hat bearing, if any, tee receipt of consultant's
fees eould have on the receipt of the Civil Service annuities by General
STAT Truscott sal I An uopUblished decision of the Comptroller General
(13-127458) dated June 61 1956, addressed to the Seoretary of Agriculture/ is
in point. That decision involved two retirod veterinarians who were paid on
a fee beide "for intermittent services" performed in control and eraacetion
of animal diseases. In holding that no deduction ea* required to be made
from the fees paid, the Comptroller General stated in part;
"It Appears that two of the veterinarians engaged by your impart-
ment on a fee basis are over 60 years of age and are receiving
annuities under the Civil Service Retirement Act, as sresseled? 5 U.S.C.
691 to 743(a). Section 2(b) of that act, as agAnded by the act of
February 26, loo, 62 Stat. 48, 5 U.S.C. 715(b), provides:
'(b) No person who is receiving an annuity uader the
provisions of this Act and who has reached the age of sixty
years shall be eligible again to appointment to any appointive
office, position, or employment under the Government of the
United States or of the District of Columbia, unless the
appointing authority determines that he is possessed of
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C-U-P-Y
special qualifications: Provided, that no deduction tor
the retirement fund shall 'be withheld frau the salary,
pay, or compensation of such person, but there shall be
deducted from his or ation otherwise
IL WW1annult cab
to period, a act ei oyaSr".ed.)
In view of the deduction provision of that part of the act just quoted,
a decision is requested as to whether any deduction should be made
from the fees paid these two annuitants and, if so, What method of
computation should be used in determining the amount to be deducted....
'In 3) C. Oen. 406, Ive stated that 'Persons compensated. on
a fee basis are not considered to be officers or employees of the
United States.' Since, as indicatedalmme, the phrase 'any appointive
office, position, or employment under the Government of the United
States' in synonymous generally with the term 'officers and epployees
of the United States,' and inasmuch as the annuitants involved here
are paid on a fee basis as distinguished trona time bawls they are
not to be considered as holding an Isqppointive office, position, or
employment under the Government of the Uaited States' within the
meaning of that language as used in section 2(b) of the Civil Service
Retirement Act, as amended. Cf. 13 C. Oen. ID1; 17 id. 847; 19
312, id. 362; 26 id. 901;-10 id. 401. Accordingly, no deduction
is required to be made from the fees paid them as compensation for
their services."
A copy of this opinion is attached for your infoxmation.
4. We note that in a memorandua dated 15 'lune 1959 from atief, Sear
East and South Asia Division to the Director of Personnel through DD/]P, it
is requested:that- be employed as a consultant at 450.00t hour es
. In view of the clear cut poSition of the Comptroller
above set forth, ye recommend, in order that there may be no
risk of deduction from his compensation as a consultant, that I STAT
contract, like that of General Truscott, provide for compensation at the
rate of 00.00 r consul tstion (whether the indiviaual consultation extends
for a period of one hour or in excess of one day).
5. le eUMMAry then, ire esqpnastitte the desirability of eliainating any
potential complication with respect to the receipt of consultant fees in
addition to retired pay be a regular officer of the armed services or by a
Civil Service annuitant (or an individual like General Truscott who qualifies
as both) by insuring that each contract provides for the payment of the inter-
mittent consultant on a fee basis (i.e., per consultation) and not in any manner
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STAT
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that could be construed as on a time basis. AVIDIM&gib should also be placed
on the intermittent nature of the services to be performed. It is recommended
that, where necessary, consultant contracts be reworded to conform to the
above, as they come up for renewal. The foregoing has been informally
discussed with a member of the Office of General Counsel to the CoagrtroLler
General, who concurs in our approach to the subject.
6. There is retuned herewith the material on. Admirals and
General Truscott, end Mr.
LAWFANGX A. MULUTON
neral. 001.1.1 Ise 1
Attachments
cc: C/Audit Staff/without basic
C/Finanee Division/without basic
Director of Personnel/Without basic
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