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Regulatory: Reorganizing the Executive Branch

President Obama has announced that he will ask Congress for authority to merge and reorganize Executive Branch agencies in order to make America more competitive. In doing so, he reopened one of the traditional fault lines between the Executive and Legislative Branches.

Reorganization authority is a special procedure under which the President issues a package of changes to consolidate agencies and to reallocate existing statutory powers among agencies, subject only to Congressional disapproval of his actions through a single up-or-down vote. Congress historically has resisted giving the President the ability to override its prior decisions about how authorities should be allocated within the Executive Branch.

Reorganization first became a political issue in 1937, when President Franklin Roosevelt requested that Congress give him authority to rationalize the many agencies created in the early days of the New Deal. The President proposed that, to promote economy in government, Congress should give him reorganization authority subject only to its right to disapprove his plan by passage of a "joint resolution," a measure that would be presented to the President for approval and vetoed.

The President's request for Reorganization authority coincided with his proposal to add new members to the Supreme Court. His opponents characterized the two proposals as a step toward an imperial President who had just won a landslide reelection. Reorganization became an important issue in the 1938 Congressional elections, and the President suffered heavy losses. In 1939, Congress passed a watered down Reorganization law under which it could overturn the President's proposal by "concurrent resolution," a measure passed by both Houses that is not subject to Presidential veto. This change in the disapproval mechanism effectively neutered the bill.

The Roosevelt Administration objected to the concurrent resolution or "legislative veto" disapproval mechanism as a violation of the President's constitutional authority to approve or veto all new laws. Despite persistent disagreement on this issue, subsequent Congresses renewed the Reorganization statute with legislative veto provisions. President Nixon used this authority to create new agencies that consolidated scattered powers, including EPA and the Office of Management and Budget.

In 1983, the Supreme Court held in Immigration and Naturalization Service v. Chadha, that the legislative veto was unconstitutional and that any measure with the force of law has to be presented to the President for approval. Since Chadha, successive Presidents have not expended their political capital in seeking Reorganization authority because they understood that Congress would insist on affirmatively approving any White House action. In effect, this meant that any Presidential proposal to create a more rational agency structure would be considered through the normal legislative process, in which opponents of the existing arrangements would block the measure by opposing each measure separately.

President Obama has not proposed a procedure to address the Congressional insistence on maintaining influence over actions of Executive agencies that has stymied prior requests for Reorganization authority. The one novel feature of the President's request was the shift in the basis for this authority from economy in government to fostering American competitiveness in global markets. The President will pursue this initiative through quiet negotiations with Congress. It remains to be seen whether, after completing these consultations, the President actually will commit the political capital necessary to work a meaningful Reorganization measure through a divided Congress that is jealous of its institutional prerogatives.

John F. Cooney is a partner in the Washington, D.C., office of Venable.

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