The Los Angeles Times from Los Angeles, California • 44

Pt Jan. 5, 1977 Uos angcltS JDmrs Texts-of Carter's Ethics and Conflict Rules -A 1. A Ax mm I nominate for appointment, only persons of high ability who will carry out their official duties without fear or favor and with an equal hand, unfettered by any actual or apparent conflicts of interest To decree that no person can have any financial interests other than a salary from the government would seriously limit the ability to recruit the most qualified persons. The Carter-Mondale administration will require full disclosure of all continuing affiliations and of assets and liabilities of nominees and their families. It is hoped that exeept in rare circumstances, divestiture causing severe tax burdens will be unnecessary if the present laws and regulatory framework are dilligently and fairly administered.

V. 1 1 'sm '1 I PLAINS, Ga. AP) Here are the texts of the statement issued Tuesday by President-elect Carter on conflicts of interest and ethics, the agreement to be signed by top political appointees, and the accompanying guidelines. The transition group has studied existing laws and regulations bearing on conflicts of interest and the regulation of ethics of officials in the executive branch of government The existing law is extremely strong in prohibiting outside earned income. Gov.

Carter heavily approves of that law and its policy. The existing law and regulations do not go as far as Gov. Carter felt appropriate as to the public disclosure of sources of income and statements of assets and liabilities. The President-elect, the Vice President-elect and all those appointed to Cabinet and White House posts will voluntarily make such statements available to the public shortly after the inauguration. Under powers delegated to the President by Congress, an executive order will be issued requiring such disclosure by all policy-making officials of the executive branch.

It appears that for those positions quiring confirmation by the Senate, a careful job is done by Senate committees of screening assets and liabilities of nominees for potential conflicts of interest and, in most cases, appropriate divestitures have been made. I PLAINS MAN Jimmy Carter meets newsmen as he arrives at his peanut warehouse. He plans to put business interests in a trust. AP Wlrephoto ministration to encourage every department and agency of the government to advise every new employe of existing laws and regulations relating to conflicts of interest to have a prior screening of such conflicts at the time of the appointment It will be a further policy to encourage departments and agencies to institute procedures for continuing policing of conflicts. It is the objective of the new administration to avoid any conflict which could in any way influence any government officer except in the even interest of all the people.

Here is the text of the form letter, addressed to President-elect Carter, which commits all his high-level appointees to a code of financial conduct and which all are required to sign: Honorable Jimmy Carter President-elect of the United States Dear Sir: Sharing your determination to assure the American people of the integrity of your administration and appreciating the confidence you have shown in me by proposing to nominate me to be (to be filled in). In addition to complying with applicable federal laws and regulations relating to conflicts of interest, if I am nominated, confirmed and take office, I agree that (1) I have already filed or will file within 30 days of taking office with those persons you specify, the following information which may be made available to the public as you may direct (A) A complete current net worth statement itemizing all assets and liabilities of myself, my spouse, my minor children, and other members of my immediate household; and (B) A sources of income statement for the year 1975 and for the period of time ending no earlier than 60 days before the above date listing all sources and amounts of all items of value received by me, my spouse, my minor children and other members of my immediate household including, but not limited to, salaries, wages, fees, honoraria, or other compensation, dividends, interest, rents, royalties, proceeds from the sale or exchange of property, and gifts. (2) While in office, in addition to complying with 18 U.S.C. Section 208, 1 will similarly refrain from participating in any particular matter, as that term is used in Section 208, in which any party as herein after specified had a direct and substantial interest: (A) Any party with which I am associated for financial gain within the year prior, to taking office as officer, employe, director, trustee, partner, or owner of more than one per cent of value of the outstanding equity ownership; or (B) With which I am negotiating or have an arrangement whether as a consultant, employe, partner, or any other position to be held for financial gain; (C) Has a direct and substantial interest (3) In addition to complying with the restrictions which may be imposed on me by federal law after termination of my government service, including those contained in 18 U.S.C. Section 207, 1 will not for two years following such termination, engage in any activity from which Section 207 (b) will bar me during the first year the only reports given to the government officer are the schedules necessary to file with income tax returns (which schedules do not list anything more than totals of taxable items from the trust).

The attention of nominees will be directed to the provisions of 18 U.S.C. Section 209 prohibiting receipt of any compensation for government service from any party other than the United States While the matter, of payments for services prior to entry into government service is properly addressed by legal counsel to the appointee and the organization making the payment, the following general guidelines seem appropriate: A. If there is a pre-existing established plan of the particular organization to reward past service, obviously such plan can be recognized and followed. B. If there is no pre-existing established plan of the particular organization it is suggested that a payment in excess of six months of salary or in excess of a range of $50,000 to $75,000 would need careful examination In all events, it is expected that payment of any severence benefits will be completed prior to the nominee's taking office in the government or within a reasonable time thereafter and that a copy of a favorable opinion of counsel to the nominee and the organization making the payment that it is lawful will be furnished.

While 18 U.S.C. Section 209 (b) allows continuing participation in bona fide pension, retirement, group life, health or accident insurance, profit-sharing, stock bonus, or other employe welfare benefit plan maintained by a former employer, nominees will be asked generally to exercise any stock options prior to commencement of government service (unless, because qf the requirements of the Securities Exchange Act, such exercise should occur within a reasonable period after beginning government service in which case the government officer may exercise within such limited period, providing other guidelines are followed concerning conflicts of interests as above stated). Nominees will also be asked not to have contributions made to profit-sharing plans by former employers based on earnings of the former employer after the government officer takes office. Deviations from the foregoing guidelines will only be made with the expressed consent of the President-elect with respect to Level I and II appointments and by heads of departments or agencies with reference to other appointments. The reasons for the deviations will be made public It is proposed to ask appointees to enter into a letter of commitment, in which, in several respects, calls for the disclosure of financial information beyond the requirements of existing law and regulations.

It is contemplated that the financial disclosure requirements will be made subject to an executive order shortly after the new administration takes office. The attached letter of commitment also describes certain restrictions requested of nominees following government service shortly after the new administration takes office. Congress will be requested to take action along the lines spelled out in the attached letter of commitment. It will be the policy of the new ad The following guidelines pertain to the assets and liabilitis of the nominee, the spouse of the nominee and the nominee's minor child or children, partner, or any organization in which the nominee continues to serve as an officer, director, trustee, partner or employe while in the government service or any private organization with which the nominee has negotiated or has any arrangement concerning prospective employment. All nominees will be expected to comply with all relevant statutes (particularly 18 U.S.C.

Section 208) and rules and practices of the particular department or agency served. If the person is nominated to a Level I or II position, divestiture should occur if compliance with the provisions of 18 U.S.C. 208 indicates a conflict requiring disqualification from action for the government more than rarely. Nominees for positions at level III and other positions of the government should require divestiture because of conflicts arising under 18 U.S.C. Section 208 only if use of disqualification will seriously impair the capability of the officer to perform the duties of the office to which nominated Beyond the requirements of 18 U.S.C.

Section 208, persons nominated to positions at Levels I or II should divest holdings and liabilities where the nature of the holding or liability is such that it will be broadly affected by governmental, monetary and budgetary policies. Generally excepted from requirements of divestiture (unless the particular position indicates continuing conflicts arising in government service with respect to a particular interest) will be made for: A. Real estate interests whether in the form of participations in partnerships. B. Savings certificates and accounts and U.S.

and other governmental securities. C. Other holdings which are diversified; e.g. less than a 1 per cent holding of a world-diversified mutual fund or a total of not more than $500,000 invested in diversified assets. Blind trusts will be recognized as appropriate methods of divestiture where divestiture is required provided: A.

The trustee is truly independent; B. The assets transferred in trust are either cash or diversified assets; C. The trustee is given entire discretion and expressed direction to sell or buy without discussion with the government officer or anyone close to such officer and after such terminatioa Also for two years following termination of government service, 1 will not, for compensation or financial gain, on behalf of any party other than the United States, make any formal or informal appearance before, or contact with, any officer or employe of the executive branch with respect to any particular matter as defined in Section 207 which was within my official responsibility as defined in 18 U.S.C. Section 202 (b) during the 12 months preceding termination of my government service. (4) For one year following termination of my government service I will not, for compensation or financial gain, on behalf of any party other than the United States, make any formal or informal appearance -before, or contact with, any officer or employe of the (insert appropriate name of department or agency).

(5) 1 will, while in government service, and for two years after leaving government service, file periodically in accordance with regulations to be promulgated by you statements of sources of income more particularly described in subpar-graph (1Mb) above. (6) In accepting the position for which you propose to nominate me it is my intention to serve for the entire term for which you appoint me and, if my term is indefinite, it is my intention to serve as long as you wish me to serve. Very truly yours. Here is the statement of the Carter-Mondale transition office on steps being taken to insulate President-elect Carter's assets from possible conflict of interest situations during his four-year White House term: In order to prevent possible financial conflicts of interest while President, Gov. Jimmy Carter is taking the following actions.

1. All common stock is being sold, consisting of 100 shares of Rich's, Inc. and 956 shares of Advanced Investors. A small net loss on this stock is likely. 2.

Jimmy Carter's interest in (a) Carter's Warehouse and Carter Farms, and any funds related to them (b) all property except the private home and personal items, and (c) his father's estate will be transferred to a trust Income or principal from the trust will be available to Jimmy Carter but only as distributions of cash. 3. No reports will be made to Jimmy Carter from the trustee or any investment advisers other than minimum tax information and an annual statement of the net value of the trust Such information, when received, will be made available to the public. 4. All salaries, profits and direct or indirect benefits from the farms or warehouse will be terminated as of Jan.

20, 1977, except as described above. 5. Trust agreement will require that investment decisions be delegated to an independent institution if investment assets, other than land, exceed $200,000. 6. Carter Farms, comprised of all farm land owned by members of the immediate family (Jimmy Carter, his wife and children) will be retained by the tust but will be rented for an annual fixed amount.

Annual after-tax income to Jimmy Carter will not exceed the amount established during the first year (calendar year 1977). Thus, the Carter family will not be affected financially from profits or losses of any of the farm operations. Jimmy and Ro-salynn Carter are resigning as officers and directors of this corporation. 7. Carter's Warehouse, a partnership consisting of Jimmy Carter, his brother Billy and his mother Lillian, will be either leased for four years for a fixed amount or sold, at the discretion of the trustee.

Again, neither Jimmy Carter, his wife nor children will be affected financially from profits or losses of any of the warehouse operations. 8. An independent charitable foundation will receive contributions, outright ownership of a book of speeches soon to be published and royalties from "Why Not the Best?" The primary purpose of this foundation will be to establish a future library to house presidential papers, documents and memorabilia. However, there appears to be a need for more uniform policies and more thorough screening of assets and liabilities of policymaking officials in posts not requiring Senate confirmatioa Therefore, we are releasing today, guidelines designed to make more uniform the policies relating to divestiture, including policies on the characteristics of trusts. The new administration will give special emphasis to better enforcement of screening procedures for officials in policymaking posts not requiring confirmation by the Senate.

The transition stutiy does not regard present laws on employment subsequent to government service as adequate. Studies by congressional committees and citizen groups show that further steps are needed to ensure that former government officials cannot use their personal contacts gained in public service for private benefit Gov. Carter has asked all persons nominated to positions in the executive branch and to independent agencies to make voluntary commitments in this regard. Those commitments are contained in an attachment to the guidelines released today. It appears that additional legislative action will be needed to satisfactorily close the "revolving door." Such action will need to give separate attention to each agency or department The Carter administration will work, beginning immediately after the inauguration, with interested citizens groups and the Congress to develop such legislation.

Carter-Mondale Transition Group Policy Guidelines on Conflicts of Interests; Financial Disclosures: and Restrictions Following Government Service. It will be the policy of the Carter-Mondale administration to appoint and THE SOFT TOUCH of Sonata polyester jersey in a marvelous midday to midnight two-piece dress. Pull-on gore skirt, self-belted tunic in salmon, soft blue or navy, 6 to 20. Orig. $65 $49.90 Wynshire Dresses, all 3 BW stores MUM 1 LOS ANGELES PALM SPRINGS WOODLAND HILLS THE FAMOUS DESIGN- ER signature is on the black face of these watches, her flair is in the whole collection.

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