Research Administration Office

University of California

Memo Operating Guidance

No. 88-5

March 18, 1988

Subject: DOD FAR Supplement Clause 252.203-7002, "Statutory Compensation Prohibitions and Reporting Requirements Relating to Certain Former DOD Employees (APR 1987)

The above-referenced clause (copy enclosed as Enclosure 1) requires the submission of an annual report on certain former DOD employees to whom a campus has paid compensation. The clause is applicable to campuses awarded more than $10,000,000 in DOD contracts a year. The first reports are due April 1, 1988, but this office has not issued operating guidance on how to comply with the clause. In order to meet the April 1 deadline, the enclosed letter has been submitted to DOD on behalf of the University as a whole (Enclosure

We are hopeful that our letter will be accepted as a reasonable approach to take in complying with the intent of the regulation and the applicable statute. We are developing a broader but still reasonable implementation plan in the event we receive a negative response from DOD.

If you are asked by a DOD official whether the University or your campus has reported as required under the above-referenced clause, you may cite the date of the enclosed letter and, upon request, provide a copy of it to DOD. If any issues arise about the adequacy of the report, please refer the DOD official to this office.

Refer: Bill Sellers

(415) 642-3045

ATSS 8-582-3045

Organization Index: F-175

Subject Index: 10, 12

David F. Mears

University Contracts and Grants Coordinator

Enclosures

cc:

Dave Dorinson

Ellen Switkes

Margo Dowen

Myrna Walton

Neville Manderson

Steve Selby


Enclosure 2 C& G Memo 88-5 March 18, 1988

March 18, 1988

Office of Assistant General Counsel (Legal Counsel)

Standards of Conduct Office

ATTN: OAGC/LC, Pentagon

Washington, D.C. 20301-1600

Dear Sirs:

Clause 252,203-7002 of the Department of Defense FAR Supplement, titled "Statutory Compensation Prohibitions and Reporting Requirements Relating to Certain Former Department of Defense Employees," has been incorporated into a number of contracts awarded to The Regents of the University of California. This clause prohibits the University from paying more than $250 compensation to certain former DOD employees. The restriction is limited to a very narrow class of individuals, which in our case includes only the Resident Representative for the Office of Naval Research on the San Diego campus and the Administrative Contract Officer for the campus in that office. These individuals were DOD employees throughout all of the past calendar year and are still DOD employees.

The above-referenced clause is also intended to result in DOD having access to information about certain former DOD employees hired by the University during the -past calendar year. The scope of the reporting part of the regulation is much broader than the scope of the hiring prohibition. The information is to be collected on form DD 1787. We note that in accordance with 32 CFR Part 40.6(d)(2), titled "Standards of Conduct--Report of DOD and Defense Related Employment," such forms are already to be submitted directly to DOD by the affected former employees. You may review the forms submitted at your convenience.

Since the clause at 252.203-7002 does not apply to state or local governments, the University of California could claim exemption from the rule because it is an instrumentality of the State of California. The corporation, The Regents of the University of California, has been variously described, but included among those characteristics are "a constitutional department or function of the state government" (Williams v. Wheeler (1913) 23 Cal.App. 619,622); "a branch of the -state itself" (Pennington v. Bonelli (1936) 15 Cal.App.2d 316,321); and "a stateside administrative agency" (Ishimatsu v. Regents of University of California (1968) 266 Cal.App.2d 854, 864). Nevertheless, we do not object to complying in a reasonable manner with the spirit and intent of the regulation, which has a worthwhile objective of minimizing conflicts of interest in the DOD procurement process.

Sincerely,

David F. Mears

University Contracts and Grants

Coordinator