Classification, Downgrading, Declassification and Safeguarding of National Security Information

OFFICE OF MANAGEMENT AND BUDGET

5 CFR Part 1312

RIN 0348-AB34

Classification, Downgrading, Declassification and Safeguarding of

National Security Information

AGENCY: Office of Management and Budget, Executive Office of the

President.

ACTION: Final rule.

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SUMMARY: This final rule amends the regulations that set forth the

procedures to be followed by the Office of Management and Budget's

(OMB) staff regarding the classification, downgrading, declassification

and safeguarding of national security information. In addition, this

final rule lists OMB staff who are authorized to originally classify

information at the top secret and secret level. These regulations also

contain the procedures to be used by OMB when other government agencies

and the public request that classified information in OMB files be

reviewed for possible declassification and release. These procedures

also outline how to appeal a decision not to declassify information.

EFFECTIVE DATE: June 9, 1997.

FOR FURTHER INFORMATION CONTACT: Darrell A. Johnson, Deputy Assistant

Director for Administration, Office of Management and Budget, at (202)

395-5715.

SUPPLEMENTARY INFORMATION: On September 17, 1996 (61 FR 48855), OMB

requested public comment on proposed revisions to its regulations at 5

CFR Part 1312 concerning the classification, downgrading,

declassification and safeguarding of national security information.

This revision is necessary to ensure conformity with Executive Order

12958 (60 FR 19825, April 20, 1995) and implementing directives issued

by the Information Security Oversight Office. OMB proposed to repeal

its existing Part 1312 and replace it with a new Part 1312.

No public comments were received in response to the September 1996

proposed rule. No substantive changes have been made to the proposed

rule, which is being adopted.

Regulatory Flexibility Act, Unfunded Mandates Reform Act, and

Executive Orders 12866 and 12875

For purposes of the Regulatory Flexibility Act (5 U.S.C. 601 et

seq.), the final rule will not have a significant economic effect on a

substantial number of small entities; the final rule addresses only the

procedures for OMB's classification, downgrading, declassification and

safeguarding of national security information. For purposes of the

Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4), as well as

Executive Orders No. 12866 and 12875, the final rule will not

significantly or uniquely affect small governments, and will not result

in increased expenditures by State, local, and tribal governments, or

by the private sector, of $100 million or more. The final rule is not a

``major rule'' under 5 U.S.C. Chapter 8; the rule will not have any of

the effects set forth in 5 U.S.C. 804(2).

Issued in Washington, DC, April 24, 1997.

Franklin D. Raines

Director.

For the reasons set forth in the preamble, OMB amends 5 CFR Chapter

III by revising Part 1312 to read as follow:

PART 1312--CLASSIFICATION, DOWNGRADING, DECLASSIFICATION AND

SAFEGUARDING OF NATIONAL SECURITY INFORMATION:

Subpart A--Classification and Declassification of National Security

Information

Sec.

1312.1 Purpose and authority.

1312.2 Responsibilities.

1312.3 Classification requirements.

1312.4 Classified designations.

1312.5 Authority to classify

1312.6 Duration of classification.

1312.7 Derivative classification.

1312.8 Standard identification and markings.

1312.9 Downgrading and declassification.

1312.10 Systematic review guidelines.

1312.11 Challenges to classifications.

1312.12 Security Program Review Committee.

Subpart B--Control and Accountability of Classified Information

1312.21 Purpose and authority.

1312.22 Responsibilities.

1312.23 Access to classified information.

1312.24 Access by historical researchers and former Presidential

appointees.

1312.25 Storage.

1312.26 Control of secret and confidential material.

1312.27 Top secret control.

1312.28 Transmission of classified material.

1312.29 Destruction.

1312.30 Loss or possible compromise.

1312.31 Security violations.

Subpart C--Mandatory Declassification Review

1312.32 Purpose and authority.

1312.33 Responsibility.

1312.34 Information in the custody of OMB.

1312.35 Information classified by another agency.

1312.36 Appeal procedure.

1312.37 Fees.

Authority: Executive Order 12958, April 20, 1995, 3 CFR, 1995

Comp., p. 333.

Subpart A--Classification and Declassification of National Security

Information

Sec. 1312.1 Purpose and authority.

This subpart sets forth the procedures for the classification and

declassification of national security information in the possession of

the Office of Management and Budget. It is issued under the authority

of Executive Order 12958, (60 FR 19825, 3 CFR, 1995 Comp., P.333), as

implemented by Information Security Oversight Office Directive No. 1

(32 CFR part 2001), and is applicable to all OMB employees.

Sec. 1312.2 Responsibilities.

The effectiveness of the classification and declassification

program in OMB depends entirely on the amount of attention paid to it

by supervisors and their staffs in those offices and divisions that

possess or produce classified material. Officials who originate

classified information are responsible for proper assignment of a

classification to that material and for the decision as to its

declassification. Officials who produce documents containing classified

information must determine the source of the classification for that

information and must ensure that the proper identity of that source is

shown on the document. Custodians of classified material are

responsible for its safekeeping and for ensuring that such material is

adequately marked as to current classification. Custodians are also

responsible for the control of and accounting for all classified

material within their area of jurisdiction as prescribed in OMB Manual

Section 1030.

(a) EOP Security Officer. In cooperation with the Associate

Director (or Assistant Director) for Administration, the EOP Security

Officer supervises the administration of this section and develops

programs to assist in the compliance with the Order. Specifically, he:

(1) Promotes the correct understanding of this section by all

employees by providing annual security refresher briefings and ensures

that new employees attend initial briefings about overall security

procedures and policies.

(2) Issues and keeps current such classification guides and

guidelines for review for declassification as are required by the

Order.

(3) Conducts periodic reviews of classified documents produced and

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provides assistance and guidance where necessary.

(4) Maintains and publishes a current listing of all officials who

have been designated in writing to have Top Secret, Secret, and

Confidential original classification authority.

(b) Heads of divisions or offices. The head of each division or

major organizational unit is responsible for the administration of this

section within his or her area. Appropriate internal guidance should be

issued to cover special or unusual conditions within an office.

Sec. 1312.3 Classification requirements.

United States citizens must be kept informed about the activities

of their Government. However, in the interest of national security,

certain official information must be subject to constraints on its

dissemination or release. This information is classified in order to

provide that protection.

(a) Information shall be considered for classification if it

concerns:

(1) Military plans, weapons systems, or operations;

(2) Foreign government information;

(3) Intelligence activities (including special activities),

intelligence sources or methods, or cryptology;

(4) Foreign relations or foreign activities of the United States,

including confidential sources;

(5) Scientific, technological, or economic matters relating to the

national security;

(6) United States Government programs for safeguarding nuclear

materials or facilities; or

(7) Vulnerabilities or capabilities of systems, installations,

projects or plans relating to the national security.

(b) When information is determined to meet one or more of the

criteria in paragraph (a) of this section, it shall be classified by an

original classification authority when he/she determines that its

unauthorized disclosure reasonably could be expected to cause at least

identifiable damage to the national security.

(c) Unauthorized disclosure of foreign government information,

including the identity of a confidential foreign source of intelligence

sources or methods, is presumed to cause damage to the national

security.

(d) Information classified in accordance with this section shall

not be declassified automatically as a result of any unofficial or

inadvertent or unauthorized disclosure in the United States or abroad

of identical or similar information.

Sec. 1312.4 Classified designations.

(a) Except as provided by the Atomic Energy Act of 1954, as

amended, (42 U.S.C. 2011) or the National Security Act of 1947, as

amended, (50 U.S.C. 401) Executive Order 12958 provides the only basis

for classifying information. Information which meets the test for

classification may be classified in one of the following three

designations:

(1) Top Secret. This classification shall be applied only to

information the unauthorized disclosure of which reasonably could be

expected to cause exceptionally grave damage to the national security

that the original classification authority is able to identify or

describe.

(2) Secret. This classification shall be applied only to

information the unauthorized disclosure of which reasonably could be

expected to cause serious damage to the national security that the

original classification authority is able to identify or describe.

(3) Confidential. This classification shall be applied only to

information the unauthorized disclosure of which reasonably could be

expected to cause damage to the national security that the original

classification authority is able to identify or describe.

(b) If there is significant doubt about the need to classify

information, it shall not be classified. If there is significant doubt

about the appropriate level of classification, it shall be classified

at the lower level.

Sec. 1312.5 Authority to classify.

(a) The authority to originally classify information or material

under this part shall be limited to those officials concerned with

matters of national security. The officials listed in this section are

granted authority by the Director, OMB, to assign original

classifications as indicated to information or material that is

originated by OMB staff and relating to the national security of the

United States:

(1) Top Secret and below:

(i) Deputy Director.

(ii) Deputy Director for Management.

(iii) Associate Director for National Security and International

Affairs.

(iv) Associate Director for Natural Resources, Energy and Science.

(2) Secret and below:

(i) Deputy Associate Director for National Security.

(ii) Deputy Associate Director for International Affairs.

(iii) Deputy Associate Director for Energy and Science.

(b) Classification authority is not delegated to persons who only

reproduce, extract, or summarize classified information, or who only

apply classification markings derived from source material or from a

classification guide.

Sec. 1312.6 Duration of classification.

(a)(1) When determining the duration of classification for

information originally classified under Executive Order 12958, an

original classification authority shall follow the following sequence:

(i) He/She shall attempt to determine a date or event that is less

than 10 years from the date of original classification, and which

coincides with the lapse of the information's national security

sensitivity, and shall assign such date or event as the

declassification instruction;

(ii) If unable to determine a date or event of less than 10 years,

he/she shall ordinarily assign a declassification date that is 10 years

from the date of the original classification decision;

(iii) He/She may extend the duration of classification or

reclassify specific information for a period not to exceed 10

additional years if such action is consistent with the exemptions as

outlined in Section 1.6(d) of the Executive Order. This provision does

not apply to information contained in records that are more than 25

years old and have been determined to have permanent historical value

under Title 44 United States Code.

(iv) He/She may exempt from declassification within 10 years

specific information, which is consistent with the exemptions as

outlined in Section 1.6 (d) of the Executive Order.

(2) Extending Duration of Classification. Extensions of

classification are not automatic. If an original classification

authority with jurisdiction over the information does not extend the

date or event for declassification, the information is automatically

declassified upon the occurrence of the date or event. If an original

classification authority has assigned a date or event for

declassification that is 10 years or less from the date of

classification, an original classification authority with jurisdiction

over the information may extend the classification duration of such

information for additional periods not to exceed 10 years at a time.

Records determined to be of historical value may not exceed the

duration of 25 years.

(b) When extending the duration of classification, the original

classification authority must:

(1) Be an original classification authority with jurisdiction over

the information.

[[Page 25428]]

(2) Ensure that the information continues to meet the standards for

classification under the Executive Order.

(3) Make reasonable attempts to notify all known holders of the

information. Information classified under prior orders marked with a

specific date or event for declassification is automatically

declassified upon that date or event. Information classified under

prior orders marked with Originating Agency's Determination Required

(OADR) shall:

(i) Be declassified by a declassification authority as defined in

Section 3.1 of the Executive Order.

(ii) Be re-marked by an authorized original classification

authority with jurisdiction over the information to establish a

duration of classification consistent with the Executive Order.

(iii) Be subject to Section 3.4 of the Executive Order if the

records are determined to be of historical value and are to remain

classified for 25 years from the date of its original classification.

Sec. 1312.7 Derivative classification.

A derivative classification means that the information is in

substance the same information that is currently classified, usually by

another agency or classification authority. The application of

derivative classification markings is the responsibility of the person

who incorporates, restates, paraphrases, or generates in new form

information that is already classified, or one who applies such

classification markings in accordance with instructions from an

authorized classifier or classification guide. Extreme care must be

taken to continue classification and declassification markings when

such information is incorporated into OMB documents. The duplication or

reproduction of existing classified information is not derivative

classification. Persons who use derivative classification need not

possess original classification authority.

Sec. 1312.8 Standard identification and markings.

(a) Original Classification. At the time classified material is

produced, the classifier shall apply the following markings on the face

of each originally classified document, including electronic media:

(1) Classification Authority. The name/personal identifier, and

position title of the original classifier shall appear on the

``Classified By'' line.

(2) Agency and Office of Origin. If not otherwise evident, the

agency and office of origin shall be identified and placed below the

name on the ``Classified By'' line.

(3) Reasons for Classification. Identify the reason(s) to classify.

The classifier shall include, at a minimum, a brief reference to the

pertinent classification category(ies), or the number 1.5 plus the

letter(s) that corresponds to that classification category in Section

1.5 of the Executive Order.

(4) Declassification instructions. These instructions shall

indicate the following:

(i) The duration of the original classification decision shall be

placed on the ``Declassify On'' line.

(ii) The date or event for declassification that corresponds to the

lapse of the information's national security sensitivity, which may not

exceed 10 years from the date of the original decision.

(iii) When a specific date or event within 10 years cannot be

established, the classifier will apply the date that is 10 years from

the date of the original decision.

(iv) The exemption category from declassification. Upon

determination that the information must remain classified beyond 10

years, the classifier will apply the letter ``X'' plus a brief

recitation of the exemption category(ies), or the letter ``X'' plus the

number that corresponds to the exemption category(ies) in Section

1.6(d) of the Executive Order.

(v) An original classification authority may extend the duration of

classification for successive periods not to exceed 10 years at a time.

The ``Declassify On'' line shall be revised to include the new

declassification instructions and shall include the identity of the

person authorizing the extension and the date of the action.

(vi) Information exempted from automatic declassification at 25

years should on the ``Declassify On'' line be revised to include the

symbol ``25X'' plus a brief reference to the pertinent exemption

categories/numbers of the Executive Order.

(5) The overall classification of the document is the highest level

of information in the document and will be conspicuously placed stamped

at the top and bottom of the outside front and back cover, on the title

page, and on the first page.

(6) The highest classification of individual pages will be stamped

at the top and bottom of each page, to include ``unclassified'' when it

is applicable.

(7) The classification of individual portions of the document,

(ordinarily a paragraph, but including subjects, titles, graphics)

shall be marked by using the abbreviations (TS), (S), (C), or (U), will

be typed or marked at the beginning or end of each paragraph or section

of the document. If all portions of the document are classified at the

same level, this may be indicated by a statement to that effect.

(b) Derivative Classification. Information classified derivatively

on the basis of source documents shall carry the following markings on

those documents:

(1) The derivative classifier shall concisely identify the source

document(s) or the classification guide on the ``Derived From'' line,

including the agency and where available the office of origin and the

date of the source or guide. When a document is classified derivatively

on the basis of more than one source document or classification guide,

the ``Derived From'' line shall appear as ``Derived From: Multiple

Sources''.

(2) The derivative classifier shall maintain the identification of

each source with the file or record copy of the derivatively classified

document. Where practicable the copies of the document should also have

this list attached.

(3) A document derivatively classified on the basis of a source

document that is itself marked ``Multiple Sources'' shall cite the

source document on its ``Derived From'' line rather than the term

``Multiple Sources''.

(4) The reason for the original classification decision, as

reflected in the source document, is not required to be transferred in

a derivative classification action.

(5) Declassification instructions shall carry forward the

instructions on the ``Declassify On'' line from the source document to

the derivation document or the duration instruction from the

classification guide. Where there are multiple sources, the longest

duration of any of its sources shall be used.

(6) When a source document or classification guide contains the

declassification instruction ``Originating Agency's Determination

Required'' (OADR) the derivative document shall carry forward the fact

that the source document(s) were so marked and the date of origin of

the most recent source document (s).

(7) The derivatively classified document shall be conspicuously

marked with the highest level of classification of information.

(8) Each portion of a derivatively classified document shall be

marked in accordance with its source.

(9) Each office shall, consistent with Section 3.8 of the Executive

Order, establish and maintain a database of information that has been

declassified.

[[Page 25429]]

(c) Additional Requirements. (1) Markings other than ``Top

Secret'', ``Secret'', and ``Confidential'' shall not be used to

identify classified national security information.

(2) Transmittal documents will be stamped to indicate the highest

classification of the information transmitted, and shall indicate

conspicuously on its face the following or something similar

``Unclassified When classified Enclosure Removed'' to indicate the

classification of the transmittal document standing alone.

(3) The classification data for material other than documents will

be affixed by tagging, stamping, recording, or other means to insure

that recipients are aware of the requirements for the protection of the

material.

(4) Documents containing foreign government information shall

include the markings ``This Document Contains (country of origin)

Information''. If the identity of the specific government must be

concealed, the document shall be marked'' This Document Contains

Foreign Government Information,'' and pertinent portions marked ``FGI''

together with the classification level, e.g., ``(FGI-C)''. In such

cases, separate document identifying the government shall be maintained

in order to facilitate future declassification actions.

(5) Documents, regardless of medium, which are expected to be

revised prior to the preparation of a finished product--working

papers--shall be dated when created, marked with highest

classification, protected at that level, and destroyed when no longer

needed. When any of the following conditions exist, the working papers

shall be controlled and marked in the same manner as prescribed for a

finished classified document:

(i) Released by the originator outside the originating activity;

(ii) Retained more than 180 days from the date of origin;

(iii) Filed permanently.

(6) Information contained in unmarked records, or Presidential or

related materials, and which pertain to the national defense or foreign

relations of the U.S. and has been maintained and protected as

classified information under prior orders shall continue to be treated

as classified information under the Executive Order and is subject to

its provisions regarding declassification.

Sec. 1312.9 Downgrading and declassification.

Classified information originated by OMB offices will be downgraded

or declassified as soon as it no longer qualifies for continued

protection under the provisions of the classification guides. Authority

to downgrade or declassify OMB-originated information is granted to

those authorized to classify (See Sec. 1312.5). Additionally, the

Associate Director (or Assistant Director) for Administration is

authorized to exercise downgrading and declassification actions up to

and including the Top Secret level.

(a) Transferred material. Information which was originated by an

agency that no longer exists, or that was received by OMB in

conjunction with a transfer of functions, is deemed to be OMB-

originated material. Information which has been transferred to another

agency for storage purposes remains the responsibility of OMB.

(b) Periodic review of classified material. Each office possessing

classified material will review that material on an annual basis or in

conjunction with the transfer of files to non-current record storage

and take action to downgrade or declassify all material no longer

qualifying for continued protection at that level. All material

transferred to non-current record storage must be properly marked with

correct downgrade and declassification instructions.

Sec. 1312.10 Systematic review guidelines.

The EOP Security Officer will prepare and keep current such

guidelines as are required by Executive Order 12958 for the downgrading

and declassification of OMB material that is in the custody of the

Archivist of the United States.

Sec. 1312.11 Challenges to classifications.

OMB employees are encouraged to familiarize themselves with the

provisions of Executive Order 12958 and with OMB Manual Sections 1010,

1020, and 1030. Employees are also encouraged to question or to

challenge those classifications they believe to be improper,

unnecessary, or for an inappropriate time. Such questions or challenges

may be addressed to the originator of the classification, unless the

challenger desires to remain anonymous, in which case the question may

be directed to the EOP Security Officer.

Sec. 1312.12 Security Program Review Committee.

The Associate Director (or Assistant Director) for Administration

will chair the OMB Security Program Review Committee, which will act on

suggestions and complaints about the OMB security program.

Subpart B--Control and Accountability of Classified Information

Sec. 1312.21 Purpose and authority.

This subpart sets forth procedures for the receipt, storage,

accountability, and transmission of classified information at the

Office of Management and Budget. It is issued under the authority of

Executive Order 12958, (60 FR 19825, 3 CFR, 1995 Comp., P.333), as

implemented by Information Security Oversight Office Directive No 1 (32

CFR part 2001), and is applicable to all OMB employees.

Sec. 1312.22 Responsibilities.

The effective direction by supervisors and the alert performance of

duty by employees will do much to ensure the adequate security of

classified information in the possession of OMB offices. Each employee

has a responsibility to protect and account for all classified

information that he/she knows of within his/her area of responsibility.

Such information will be made available only to those persons who have

an official need to know and who have been granted the appropriate

security clearance. Particular care must be taken not to discuss

classified information over unprotected communications circuits (to

include intercom and closed-circuit TV), at non-official functions, or

at any time that it might be revealed to unauthorized persons.

Classified information may only be entered into computer systems

meeting the appropriate security criteria.

(a) EOP Security Officer. In cooperation with the Associate

Director (or Assistant Director) for Administration, the EOP Security

Officer supervises the administration of this section. Specifically,

he/she:

(1) Promotes the correct understanding of this section and insures

that initial and annual briefings about security procedures are given

to all new employees.

(2) Provides for periodic inspections of office areas and reviews

of produced documents to ensure full compliance with OMB regulations

and procedures.

(3) Takes prompt action to investigate alleged violations of

security, and recommends appropriate administrative action with respect

to violators.

(4) Supervises the annual inventories of Top Secret material.

(5) Ensures that containers used to store classified material meet

the appropriate security standards and that combinations to security

containers are changed as required.

(b) Heads of Offices. The head of each division or office is

responsible for the

[[Page 25430]]

administration of this section in his/her area. These responsibilities

include:

(1) The appointment of accountability control clerks as prescribed

in Sec. 1312.26.

(2) The maintenance of the prescribed control and accountability

records for classified information within the office.

(3) Establishing internal procedures to ensure that classified

material is properly safeguarded at all times.

Sec. 1312.23 Access to classified information.

Classified information may be made available to a person only when

the possessor of the information establishes that the person has a

valid ``need to know'' and the access is essential to the

accomplishment of official government duties. The proposed recipient is

eligible to receive classified information only after he/she has been

granted a security clearance by the EOP Security Officer. Cover sheets

will be used to protect classified documents from inadvertent

disclosure while in use. An SF-703 will be used for Top Secret

material; an SF-704 for Secret material, and an SF-705 for Confidential

material. The cover sheet should be removed prior to placing the

document in the files.

Sec. 1312.24 Access by historical researchers and former Presidential

appointees.

(a) The requirements of Section 4.2(a)(3) of Executive Order 12958

may be waived for persons who are engaged in historical research

projects, or who previously have occupied policy-making positions to

which they were appointed by the President. Waivers may be granted only

if the Associate Director (or Assistant Director) for Administration,

in cooperation with the EOP Security Officer:

(1) Determines in writing that access is consistent with the

interest of national security;

(2) Takes appropriate steps to protect classified information from

unauthorized disclosure or compromise, and ensures that the information

is safeguarded in a manner consistent with the order; and

(3) Limits the access granted to former Presidential appointees to

items that the person originated, reviewed, signed, or received while

serving as a Presidential appointee.

(b) In the instances described in paragraph (a) of this section,

the Associate Director (or Assistant Director) for Administration, in

cooperation with the EOP Security Officer, will make a determination as

to the trustworthiness of the requestor and will obtain written

agreement from the requestor to safeguard the information to which

access is given. He/She will also obtain written consent to the review

by OMB of notes and manuscripts for the purpose of determining that no

classified information is contained therein. Upon the completion of

these steps, the material to be researched will be reviewed by the

division/office of primary interest to ensure that access is granted

only to material over which OMB has classification jurisdiction.

Sec. 1312.25 Storage.

All classified material in the possession of OMB will be stored in

a GSA-approved container or in vault-type rooms approved for Top Secret

storage. Under the direction of the EOP Security Officer, combinations

to safes used in the storage of classified material will be changed

when the equipment is placed in use, whenever a person knowing the

combination no longer requires access to it, whenever the combination

has been subjected to possible compromise, whenever the equipment is

taken out of service, or at least once a year. Knowledge of

combinations will be limited to the minimum number of persons

necessary, and records of combinations will be assigned a

classification no lower than the highest level of classified

information stored in the equipment concerned. An SF-700, Security

Container Information, will be used in recording safe combinations.

Standard Form-702, Security Container check sheet, will be posted to

each safe and will be used to record opening, closing, and checking the

container whenever it is used.

Sec. 1312.26 Control of secret and confidential material.

Classified material will be accounted for by the office having

custody of the material. OMB Form 87, Classified Document Control, will

be used to establish accountability controls on all Secret material

received or produced within OMB offices. No accountability controls are

prescribed for Confidential material, but offices desiring to control

and account for such material should use the procedures applicable to

Secret material. Information classified by another agency shall not be

disclosed without that agency's authorization.

(a) Accountability Control Clerks. Each division or office head

will appoint one person as the Accountability Control Clerk (ACC). The

ACC will be the focal point for the receipt, routing, accountability,

dispatch, and declassification downgrading or destruction of all

classified material in the possession of the office.

(b) OMB Form 87. One copy of OMB Form 87 will be attached to the

document, and one copy retained in the accountability control file for

each active document within the area of responsibility of the ACC.

Downgrading or destruction actions, or other actions removing the

document from the responsibility of the ACC will be recorded on the OMB

Form 87, and the form filed in an inactive file. Inactive control forms

will be cut off annually, held for two additional years, then

destroyed.

(c) Working papers and drafts. Working papers and drafts of

classified documents will be protected according to their security

classification, but will not be subject to accountability control

unless they are forwarded outside of OMB.

(d) Typewriter ribbons. Typewriter ribbons, cassettes, and other

devices used in the production of classified material will be removed

from the machine after each use and protected as classified material

not subject to controls. Destruction of such materials will be as

prescribed in Sec. 1312.29.

(e) Reproduction. Classified material will be reproduced only as

required unless prohibited by the originator for the conduct of

business and reproduced copies are subject to the same controls as are

the original documents. Top Secret material will be reproduced only

with the written permission of the originating agency.

Sec. 1312.27 Top secret control.

The EOP Security Officer serves as the Top Secret Control Officer

(TSCO) for OMB. He will be assisted by the Alternate TSCOs in each

division/office Holding Top Secret material. The ATSCOs will be

responsible for the accountability and custodianship of Top Secret

material within their divisions/offices. The provisions of this section

do not apply to special intelligence material, which will be processed

as prescribed by the controlling agency.

(a) Procedures. All Top Secret material produced or received in OMB

will be taken to the appropriate ATSCO for receipting, establishment of

custodianship, issuance to the appropriate action officer, and, as

appropriate, obtaining a receipt. Top Secret material in the custody of

the TSCO or ATSCO will normally be segregated from other classified

material and will be stored in a safe under his or her control. Such

material will be returned to the appropriate ATSCO by action officers

as soon as action is completed. OMB Form 87 will be used

[[Page 25431]]

to establish custody, record distribution, routing, receipting and

destruction of Top Secret material. Top Secret Access Record and Cover

Sheet (Standard Form 703) will be attached to each Top Secret document

while it is in the possession of OMB.

(b) Inventory. The Associate Director (or Assistant Director) for

Administration will notify each appropriate OMB office to conduct an

inventory of its Top Secret material by May 1 each year. The head of

each office will notify the EOP Security Officer when the inventory has

been satisfactorily completed. Each Top Secret item will be examined to

determine whether it can be downgraded or declassified, and the

inventory will be adjusted accordingly. Discrepancies in the inventory,

indicating loss or possible compromise, will be thoroughly investigated

by the EOP Security Officer or by the Federal Bureau of Investigation,

as appropriate. Each ATSCO will retain his/her division's inventory in

accordance with the security procedures set forth in this regulation.

Sec. 1312.28 Transmission of classified material.

Prior to the transmission of classified material to offices outside

OMB, such material will be enclosed in opaque inner and outer covers or

envelopes. The inner cover will be sealed and marked with the

classification, and the address of the sender and of the addressee. The

receipt for the document, OMB Form 87, (not required for Confidential

material) will be attached to or placed within the inner envelope to be

signed by the recipient and returned to the sender. Receipts will

identify the sender, the addressee, and the document, and will contain

no classified information. The outer cover or envelope will be sealed

and addressed with no identification of its contents.

(a) Transmittal of Top Secret Material. The transmittal of Top

Secret material shall be by personnel specifically designated by the

EOP Security Officer, or by Department of State diplomatic pouch, by a

messenger-courier system specifically created for that purpose.

Alternatively, it shall be taken to the White House Situation Room for

transmission over secure communications circuits.

(b) Transmittal of Secret Material. The transmittal of Secret

material shall be as follows:

(1) Within and between the fifty States, the District of Columbia,

and Puerto Rico: Use one of the authorized means for Top Secret

material, or transmit by U.S. Postal Service express or registered

mail.

(2) Other Areas. Use the same means authorized for Top Secret, or

transmit by U.S. registered mail through Military Postal Service

facilities.

(c) Transmittal of Confidential Material. As identified in

paragraphs (a) and (b) of this section, or transmit by U.S. Postal

Service Certified, first class, or express mail service within and

between the fifty States, the District of Columbia, and Puerto Rico.

(d) Transmittal between OMB offices and within the EOP complex.

Classified material will normally be hand carried within and between

offices in the Executive Office of the President complex by cleared OMB

employees. Documents so carried must be protected by the appropriate

cover sheet or outer envelope. Top Secret material will always be hand

carried in this manner. Secret and Confidential material may be

transmitted between offices in the EOP complex by preparing the

material as indicated above (double envelope) and forwarding it by

special messenger service provided by the messenger center. The

messenger shall be advised that the material is classified. Receipts

shall be obtained if Top Secret or Secret material is being transmitted

outside of OMB. Classified material will never be transmitted in the

Standard Messenger Envelope (SF Form 65), or by the Mail Stop system.

Sec. 1312.29 Destruction.

The destruction of classified material will be accomplished under

the direction of the TSCO or the appropriate ATSCO, who will assure

that proper accountability records are kept. Classified official record

material will be processed to the Information Systems and Technology,

Records Management Office, Office of Administration, NEOB Room 5208, in

accordance with OMB Manual Section 540. Classified nonrecord material

will be destroyed as soon as it becomes excess to the needs of the

office. The following destruction methods are authorized:

(a) Shredding. Using the equipment approved for that purpose within

OMB offices. Shredders will not accommodate typewriter ribbons or

cassettes. Shredding is the only authorized means of Destroying Top

Secret material.

(b) Burn Bag. Classified documents, cassettes, ribbons, and other

materials at the Secret level or below, not suitable for shredding, may

be destroyed by using burn bags, which can be obtained from the supply

store. They will be disposed of as follows:

(1) OEOB. Unless on an approved list for pick-up of burn bags, all

other burn bags should be delivered to Room 096, OEOB between 8:00 a.m.

and 4:30 p.m. Burn bags are not to be left in hallways.

(2) NEOB. Hours for delivery of burn bag materials to the NEOB

Loading Dock Shredder Room are Monday through Friday from 8:00 a.m. to

9:30 a.m.; 10:00 a.m. to 11:00 a.m.; 11:45 a.m. to 1:30 p.m. and 2:00

p.m. to 3:30 p.m. The phone number of the Shredder Room is 395-1593. In

the event the Shredder Room is not manned, do not leave burn bags

outside the Shredder Room as the security of that material may be

compromised.

(3) Responsibility for the security of the burn bag remains with

the OMB office until it is handed over to the authorized representative

at the shredder room. Accountability records will be adjusted after the

burn bags have been delivered. Destruction actions will be recorded on

OMB Form 87 by the division TSCO or by the appropriate ATSCO at the

time the destruction is accomplished or at the time the burn bag is

delivered to the U.D. Officer.

(c) Technical Guidance. Technical guidance concerning appropriate

methods, equipment, and standards for destruction of electronic

classified media, processing equipment components and the like, may be

obtained by submitting all pertinent information to NSA/CSS Directorate

for Information Systems Security, Ft. Meade, Maryland 20755.

Specifications concerning appropriate equipment and standards for

destruction of other storage media may be obtained from the General

Services Administration.

Sec. 1312.30 Loss or possible compromise.

Any person who has knowledge of the loss or possible compromise of

classified information shall immediately secure the material and then

report the circumstances to the EOP Security Officer. The EOP Security

Officer will immediately initiate an inquiry to determine the

circumstances surrounding the loss or compromise for the purpose of

taking corrective measures and/or instituting appropriate

administrative, disciplinary, or legal action. The agency originating

the information shall be notified of the loss or compromise so that the

necessary damage assessment can be made.

Sec. 1312.31 Security violations.

(a) A security violation notice is issued by the United States

Secret Service when an office/division fails to properly secure

classified information. Upon discovery of an alleged security

violation, the USSS implements their

[[Page 25432]]

standard procedures which include the following actions:

(1) Preparation of a Record of Security Violation form;

(2) When a document is left on a desk or other unsecured area, the

officer will remove the classified document(s) and deliver to the

Uniformed Division's Control Center; and

(3) Where the alleged violation involves an open safe, the officer

will remove one file bearing the highest classification level, annotate

it with his or her name, badge number, date and time, and return the

document to the safe, which will then be secured. A description of the

document will be identified in the Record of Security Violations and a

copy of the violation will be left in the safe.

(b) Office of record. The EOP Security Office shall serve as the

primary office of record for OMB security violations. Reports of

violations will remain in the responsible individual's security file

until one year after the individual departs the Executive Office of the

President, at which time all violation reports will be destroyed.

(c) Compliance. All Office of Management and Budget employees will

comply with this section. Additionally, personnel on detail or

temporary duty will comply with this section, however, their parent

agencies will be provided with a copy of any security violation

incurred during their period of service to OMB.

(d) Responsibilities for processing security violations. (1) EOP

Security Officer. The EOP Security Officer shall provide OMB with

assistance regarding Agency security violations. Upon receipt of a

Record of Security Violation alleging a security violation, the EOP

Security Officer shall:

(i) Prepare a memorandum to the immediate supervisor of the office/

division responsible for the violation requesting that an inquiry be

made into the incident. Attached to the memorandum will be a copy of

the Record of Security Violation form. The receiving office/division

will prepare a written report within five working days of its receipt

of the Security Officer's memorandum.

(ii) Provide any assistance needed for the inquiry conducted by the

office/division involved in the alleged violation.

(iii) Upon receipt of the report of inquiry from the responsible

office/division, the EOP Security Officer will:

(A) Consult with the OMB Associate Director (or Assistant Director)

for Administration and the General Counsel;

(B) Determine if a damage assessment report is required. A damage

assessment will be made by the agency originating the classified

information, and will be prepared after it has been determined that the

information was accessed without authorization; and

(C) Forward the report with a recommendation to the OMB General

Counsel.

(2) Immediate supervisors. Upon receipt of the EOP Security

Officer's security violation memorandum, the immediate supervisor will

make an inquiry into the alleged incident, and send a written report of

inquiry to the EOP Security Officer. The inquiry should determine, and

the related report should identify, at a minimum:

(i) Whether an actual security violation occurred;

(ii) The identity of the person(s) responsible; and

(iii) The probability of unauthorized access.

(3) Deputy Associate Directors (or the equivalent) will:

(i) Review and concur or comment on the written report; and

(ii) In conjunction with the immediate supervisor, determine what

action will be taken to prevent, within their area of responsibility, a

recurrence of the circumstances giving rise to the violation.

(e) Staff penalties for OMB security violations. When assessing

penalties in accordance with this section, only those violations

occurring within the calendar year (beginning January 1) will be

considered. However, reports of all previous violations remain in the

security files. These are the standard violation penalties that will be

imposed. At the discretion of the Director or his designee, greater or

lesser penalties may be imposed based upon the circumstances giving

rise to the violation, the immediate supervisor's report of inquiry,

and the investigation and findings of the EOP Security Officer and/or

the OMB Associate Director (or Assistant Director) for Administration.

(1) First violation:

(i) Written notification of the violation will be filed in the

responsible individual's security file; and

(ii) The EOP Security Officer and/or the Associate Director (or

Assistant Director) for Administration will consult with the respective

immediate supervisor, and the responsible individual will be advised of

the penalties that may be applied should a second violation occur.

(2) Second violation:

(i) Written notification of the violation will be filed in the

responsible individual's security file;

(ii) The EOP Security Officer and/or the Associate Director (or

Assistant Director) for Administration will consult with the respective

Deputy Associate Director (or the equivalent) and immediate supervisor

and the responsible individual who will be advised of the penalties

that may be applied should a third violation occur; and

(iii) A letter of Warning will be placed in the Disciplinary Action

file maintained by the Office of Administration, Human Resources

Management Division.

(3) Third violation:

(i) Written notification of the violation will be filed in the

responsible individual's security file;

(ii) The EOP Security Officer and/or the Associate Director (or

Assistant Director) for Administration will consult with the OMB Deputy

Director, General Counsel, the respective Deputy Associate Director (or

equivalent), and the immediate supervisor and the responsible

individual who will be advised of the penalties that may be applied

should a fourth violation occur; and

(iii) A Letter of Reprimand will be placed in the Disciplinary

Action file maintained by the OA/HRMD.

(4) Fourth violation:

(i) Written notification of the violation will be filed in the

responsible individual's security file;

(ii) The EOP Security Officer and/or the Associate Director (or

Assistant Director) for Administration will consult with the OMB

Director, Deputy Director, General Counsel, the respective Deputy

Associate Director (or the equivalent), and immediate supervisor;

(iii) The responsible individual may receive a suspension without

pay for a period not to exceed 14 days; and

(iv) The responsible individual will be advised that future

violations could result in the denial of access to classified material

or other adverse actions as may be appropriate, including dismissal.

Subpart C--Mandatory Declassification Review

Sec. 1312.32 Purpose and authority.

Other government agencies, and individual members of the public,

frequently request that classified information in OMB files be reviewed

for possible declassification and release. This subpart prescribes the

procedures for such review and subsequent release or denial. It is

issued under the authority of Executive Order 12958 (60 FR 19825, 3

CFR, 1995 Comp., p. 333),

[[Page 25433]]

as implemented by Information Security Oversight Office Directive No. 1

(32 CFR part 2001).

Sec. 1312.33 Responsibility.

All requests for the mandatory declassification review of

classified information in OMB files should be addressed to the

Associate Director (or Assistant Director) for Administration, who will

acknowledge receipt of the request. When a request does not reasonably

describe the information sought, the requester shall be notified that

unless additional information is provided, or the scope of the request

is narrowed, no further action will be taken. All requests will receive

a response within 180 days of receipt of the request.

Sec. 1312.34 Information in the custody of OMB.

Information contained in OMB files and under the exclusive

declassification jurisdiction of the office will be reviewed by the

office of primary interest to determine whether, under the

declassification provisions of the Order, the requested information may

be declassified. If so, the information will be made available to the

requestor unless withholding is otherwise warranted under applicable

law. If the information may not be released, in whole or in part, the

requestor shall be given a brief statement as to the reasons for

denial, a notice of the right to appeal the determination to the Deputy

Director, OMB, and a notice that such an appeal must be filed within 60

days in order to be considered.

Sec. 1312.35 Information classified by another agency.

When a request is received for information that was classified by

another agency, the Associate Director (or Assistant Director) for

Administration will forward the request, along with any other related

materials, to the appropriate agency for review and determination as to

release. Recommendations as to release or denial may be made if

appropriate. The requester will be notified of the referral, unless the

receiving agency objects on the grounds that its association with the

information requires protection.

Sec. 1312.36 Appeal procedure.

Appeals received as a result of a denial, see Sec. 1312.34, will be

routed to the Deputy Director who will take action as necessary to

determine whether any part of the information may be declassified. If

so, he will notify the requester of his determination and make that

information available that is declassified and otherwise releasable. If

continued classification is required, the requestor shall be notified

by the Deputy Director of the reasons thereafter. Determinations on

appeals will normally be made within 60 working days following receipt.

If additional time is needed, the requestor will be notified and this

reason given for the extension. The agency's decision can be appealed

to the Interagency Security Classification Appeals Panel.

Sec. 1312.37 Fees.

There will normally be no fees charged for the mandatory review of

classified material for declassification under this section.

[FR Doc. 97-12247 Filed 5-8-97; 8:45 am]

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