Sunset of the Pathways Presidential Management Fellows Program

<RULE> OFFICE OF PERSONNEL MANAGEMENT <CFR>5 CFR Parts 213, 315, 362, and 537</CFR> <RIN>RIN 3206-AO85</RIN> <SUBJECT>Sunset of the Pathways Presidential Management Fellows Program</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Office of Personnel Management. <HD SOURCE="HED">ACTION:</HD> Final rule. <SUM> <HD SOURCE="HED">SUMMARY:</HD> As directed by the Executive Order “Commencing the Reduction of the Federal Bureaucracy” issued February 19, 2025, the Office of Personnel Management (OPM) is rescinding the regulations on the Pathways Presidential Management Fellows Program and making conforming amendments. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> This final rule is effective on August 11, 2025. </EFFDATE> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Katika Floyd by telephone at (202) 606-0960; or by email at <E T="03">employ@opm.gov.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">Background and Legal Authority</HD> This final rule is issued in accordance with section 2(e) of Executive Order (E.O.) 14217, “Commencing the Reduction of the Federal Bureaucracy” (90 FR 10577, Feb. 25, 2025), which directed the Director of Office of Personnel Management (OPM) to initiate the process to withdraw the Pathways Presidential Management Fellows (PMF) Program (PMF Program or Program) regulations in subpart D of part 362, Code of Federal Regulations (CFR), and to take any other steps necessary to promptly terminate the PMF Program. This action is taken under the authority vested in the President by the Constitution and laws of the United States of America, including 5 U.S.C. 3301 and 3302. The PMF program (formerly, Presidential Management Intern Program) was established by President Jimmy Carter in 1977 to attract to Federal service a limited number of individuals, with exceptional management potential, who received special academic training (advanced degrees) in planning and managing public programs and policies. E.O. 12008, 42 FR 43373. Since that time, the PMF Program had evolved to cover a variety of academic disciplines covering a multitude of Federal occupations and was no longer limited to a small number of participants. It is no longer necessary to have a separate employment program for those with advanced degrees when the same can be accomplished using the other available employment authorities and programs for interns, fellows, and college graduates. Just as the creation of the PMF Program was consistent with the President's authority under 5 U.S.C. 3301 and 3302, similarly the sunset of the PMF Program falls within the President's discretion. OPM will continue to assess the need for fellowship, internship, and leadership development programs and work within its existing authorities to attract top talent to the Federal government. To date, OPM has taken steps to begin the sunset of the PMF Program: • Notifying agency PMF coordinators on the actions to be taken as the PMF Program sunsets; • Notifying Presidential Management Fellows (Fellows) of Executive Order requirements to terminate the PMF program and the sunset activities that were underway; • Canceling the announcement of the 2025 PMF finalists; and • Drafting transitional guidance to address current PMF employment matters. This final rule removes the regulations governing the PMF Program in subpart D of part 362 and makes conforming changes in parts 213 and 315. Specifically, references to the PMF Program and/or subpart D are removed from §§ 213.3402, 315.201, 315.713, 362.101, 362.103, 362.104, 362.105, 362.107, 362.109, and 537.102 of title 5 of the Code of Federal Regulations. In addition, 5 CFR 362.110 is removed. OPM is also amending the authority citations for parts 213, 315, and 362 as appropriate to reflect the termination of the PMF Program and to conform to the requirements of 1 CFR part 21, subpart B. In addition to the regulatory changes in this final rule, OPM notes that less than 650 employees remain employed under the PMF appointment authority. OPM is publishing a Variation to facilitate the transition of current Fellows out of the Program while promptly terminating the PMF Program. (See the Notification published elsewhere in this edition of the <E T="04">Federal Register</E> .) <HD SOURCE="HD1">Impact of This Rulemaking</HD> The elimination of the PMF Program in subpart D of part 362 from the CFR will eliminate a centralized recruitment and employment program for individuals with advanced degrees the President has determined is unnecessary. OPM anticipates that there will be negligible administrative costs associated with administering the sunset of the program, and OPM anticipates net savings to the Government based on the efficiencies created by agencies not having to contribute to the overhead costs for operating a centralized program and instead using other existing recruitment and hiring programs that can serve the same purpose for bringing talent into the Federal government. Agencies contributed $2M to $2.5M annually to operate the centralized program. About 30 agencies participated each year, contributing a set fee per hire (most recently $8,000 per Fellow). These expenses covered OPM administrative costs such as running the recruitment, evaluation, and selection processes and providing training for Fellows. Agencies already have procedures and systems in place to conduct these activities; eliminating the duplication of effort represents cost savings. The expenses also covered ongoing support for agencies and Fellows and monitoring agency compliance with Program requirements, functions that are now eliminated. OPM estimates that sunsetting the Program will result in savings of roughly 80% of these costs to the Government, or $1.8M annually. Agencies also expended resources for operation of the agency's PMF Program. Program regulations required agencies to provide a PMF Coordinator with required functions, agency-funded training (in addition to the OPM-provided training), detail opportunities, mentoring, and Executive Resource Board (ERB) review and certification. Some of the functions are eliminated with the sunsetting of the Program, and agencies already have systems in place to provide the remaining functions for their employees. Although OPM does not have data regarding these additional costs borne by agencies, we can estimate portions of these expenses. For the purpose of this cost analysis, the assumed average salary rate of Federal employees serving as an agency's PMF Coordinator will be the rate in 2025 for GS-12, step 5, from the Washington, DC, locality pay table ($114,923 annual locality rate and $55.07 hourly locality rate). We assume that the total dollar value of labor, which includes wages, benefits, and overhead, is equal to 200 percent of the wage rate, resulting in an assumed labor cost of $110.14 per hour. We estimate that PMF Coordinators spent an average of 520 hours annually on work related to the PMF Program with an average hourly cost of $110.14. This work would result in estimated annual savings of about $52,273 per agency, and about $1.7 million Governmentwide. With respect to the ERB, we assume an ERB at agencies participating in the PMF Program has an average of 5 members. Based on the average salary for the ES pay plan in September 2024 (most recent available data), we assume an average salary rate of $207,313, or $99.67 per hour. <SU>1</SU> <FTREF/> We assume the total dollar value of labor, which includes wages, benefits, and overhead, is equal to 200 percent of the wage rate, resulting in an assumed labor cost of $199.34 per hour. We assume an ERB member will spend approximately 30 minutes to review and certify each Fellow. Based on an average of the last three years' participation, OPM estimates approximately 330 Fellows would have completed the Program each year, requiring ERB review and certification. Because the ERB will no longer need to review and certify PMF Fellows prior to conversion, OPM estimates annual savings of $165,000 Governmentwide. <FTNT> <SU>1</SU>  Average SES pay drawn from Office of Personnel Management FedScope data, available at <E T="03">https://www.fedscope.opm.gov/.</E> </FTNT> Overall, OPM expects that elimination of the PMF program will result in Government savings of at least $3,665,000 annually. OPM notes that this savings value is conservative in that we have used the minimum grade for one PMF Coordinator per agency. Some agencies with large PMF Programs have more than one PMF Coordinator, and some Coordinators hold higher grades with higher rates of pay. In addition, although participation in the Program dropped due to COVID-19, participation has been steadily increasing. OPM also had anticipated that changes made to the Program in 2024 would encourage participation by more agencies. Thus, the number of participants requiring certification is likely lower than would have been realized had the Program continued. Finally, this value does not reflect costs incurred by agencies other than the PMF Program fees, costs associated with PMF Coordinators, and costs associated with ERB certification. <HD SOURCE="HD1">Regulatory Compliance</HD> <HD SOURCE="HD2">1. Administrative Procedure Act</HD> Pursuant to 5 U.S.C. 553(b)(B), OPM finds that there is good cause to issue this final rule without prior notice and comment. In E.O. 14217, the President directed OPM to withdraw the regulations at part D of part 362 and to take other steps necessary to terminate the PMF Program promptly. The PMF Program regulations do not allow for the prompt termination of the program, particularly in view of the employees remaining in the Program; thus, this final rule implements the specific Presidential direction provided in the E.O. to remove the regulations governing the Program. OPM lacks any discretion in this rulemaking actio ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 24k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━