TO: Heads of State Departments and Agencies

SUBJECT: To Provide Policy and Procedure Regulating The Payment of Extra Compensation to Certain State Employees

WHEREAS, the Grand Jury of New Castle County recently filed with the Superior Court a presentment in which the Grand Jury found that "various forms of extra compensation have been paid by some State agencies, including the Youth Services Commission, to employees whose salaries are specified by line item in budget acts" and recommended to the Governor and the General Assembly that such irregularities be expressly prohibited by Statute; and

WHEREAS, the Governor of Delaware and the Permanent Budget Commission have previously had deep concern in connection with this subject matter; and

WHEREAS, in January 17, 1962, the Governor of Delaware appointed the Governor's Committee to Improve Efficiency in State Financial Management which has retained a management consulting firm to make a comprehensive study and recommendations concerning the entire fiscal and accounting system of the State; and

WHEREAS, pending the completion and implementation of such comprehensive study, it is the desire of the Governor to take such interim corrective action as may be within his power by Executive Order for the following purposes:

1. To prohibit any State Agency or Department from making irregular or improper payments of extra compensation to its employees; and

2. To prohibit any State Agency or Department from making any payment, in money or in kind, to any line item salaried employee or any employee whose salary is fixed by Statute without the approval of the Budget Commission; and

3. To specify the policies and procedures, to the extent possible under present law, regarding the payment of extra compensation by the State to any employee of a State Agency or Department.

NOW, THEREFORE, by virtue of the authority vested in me as Governor of Delaware, IT IS HEREBY ORDERED as follows with respect to all employees of all Agencies and Departments in the Executive Branch of the State Government:

1. The payment of extra compensation by any office or agency to any employee whose salary is fixed by line item in the applicable budget act or whose salary is fixed by statute, except as herein provided, is expressly prohibited. A violation of this provision of this Order, after publication thereof, shall be prima facie evidence that said irregular and/or improper payment was made willfully, intentionally, and not in good faith.

2. The payment of any extra compensation to any such employee, whether in cash or in kind, is prohibited without the express prior permission in writing of the Permanent Budget Commission.

3. The payment of any extra compensation to any such employee, whether in cash or in kind, shall be separately and clearly shown by name and amount on all annual budget estimates, annual reports, and other statements required to be submitted either to the Permanent Budget Commission and/or the Joint Finance Committee of the General Assembly.

4. Effective immediately, every officer and agency of this State desiring to pay extra compensation, whether in cash or in kind, to any such employee shall make application therefor in writing to the Permanent Budget Commission stating in full the name and position of such person, the line item or statutory salary provided, the amount or nature of the extra compensation, and the reasons for the request including, but without limitation to, what, if any, extra duties are to be performed therefor, whether or not these duties are to be performed during normal working hours, and why these duties are not within the normal scope of the employment of such employees.

5. Extra compensation to any State employee, whether or not to employees whose salaries are fixed by line item or by statute, shall be submitted for payment to the Auditor, of Accounts on the regular bi-monthly "Payroll and Distribution Register" of the office or agency.

6. The Auditor of Accounts shall not approve and the State Treasurer shall not pay any compensation to any State officer or employee unless the same is in compliance with this Executive Order. The Permanent Budget Commission shall report all violations of this Executive Order to the Attorney General as soon as the same shall come to its attention, together with such facts as shall then be in its possession or shall later come to its attention. All officers and agencies of the State be, and they are hereby informed and advised, that compliance or non-compliance with this Executive Order will be a factor considered by the Permanent Budget Commission in its preparation of the annual budget estimates for the officers and agencies involved.

7. It is recognized that this Executive Order provides pioneer restraints in this field and may be modified from time to time as a result of future experience developed hereunder.

8. Nothing in this Order shall be construed to supersede or alter any existing statute.

APPROVED this twenty-first day of June, 1962.


By the Governor


Attest: ELISHA C. DUKES, Secretary of State