Designating an Acting Director of the Federal Housing Finance Agency

CourtDepartment of Justice Office of Legal Counsel
DecidedMarch 18, 2019
StatusPublished

This text of Designating an Acting Director of the Federal Housing Finance Agency (Designating an Acting Director of the Federal Housing Finance Agency) is published on Counsel Stack Legal Research, covering Department of Justice Office of Legal Counsel primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Designating an Acting Director of the Federal Housing Finance Agency, (olc 2019).

Opinion

(Slip Opinion)

Designating an Acting Director of the Federal Housing Finance Agency In designating an Acting Director of the Federal Housing Finance Agency, the President may choose either an incumbent Deputy Director under 12 U.S.C. § 4512(f ), the vacancy statute that applies specifically to the office of the Director, or someone who is made eligible to be an acting officer by the Vacancies Reform Act of 1998. Under the latter, the President may select the Senate-confirmed Comptroller of the Currency.

March 18, 2019

MEMORANDUM OPINION FOR THE DEPUTY COUNSEL TO THE PRESIDENT

On December 18, 2018, the Director of the Federal Housing Finance Agency (“FHFA”) sent the President a letter of resignation, “effective at midnight on January 6, 2019.” Two days later, the President announced his intention to designate the Comptroller of the Currency as FHFA’s Acting Director. 1 This Office had previously advised that the President could invoke the Vacancies Reform Act of 1998, 5 U.S.C. §§ 3345−3349d, to make that designation upon the resignation of the incumbent Director. This memorandum explains the basis for that advice, which is consistent with several previous opinions of this Office. The Vacancies Reform Act provides the President with authority “for temporarily authorizing an acting official to perform the functions and duties” of an officer of an “Executive agency” whose appointment, like that of the FHFA Director, “is required to be made by the President, by and with the advice and consent of the Senate.” 5 U.S.C. § 3347(a). The Vacancies Reform Act is the “exclusive means” for authorizing acting service in most such positions “unless” another statute expressly desig- nates an officer to serve in an acting capacity or expressly authorizes the President, a court, or an agency head to designate an acting officer. Id. (emphasis added). In the case of a vacancy in the office of the FHFA Director, another statute does allow the President to select an Acting Director from among three Deputy Directors appointed by the Director. See 12 U.S.C. § 4512(f ).

1 See President Donald J. Trump Announces Intent to Designate Individual to a Key

Administration Post (Dec. 20, 2018), www.whitehouse.gov/presidential-actions/president- donald-j-trump-announces-intent-designate-individual-key-administration-post-2/.

1 Opinions of the Office of Legal Counsel in Volume 43

This Office has repeatedly concluded that the Vacancies Reform Act still applies to an executive office, including that of an agency head, when another office-specific statute would enable someone else to serve as the acting officer. The federal courts have consistently agreed that, in such a circumstance, the President may choose between the office-specific statute and the Vacancies Reform Act when designating an acting officer. We therefore advised that the President could invoke the Vacancies Reform Act to designate an Acting Director of FHFA and, in doing so, could select a Senate-confirmed officer, such as the Comptroller of the Currency. See 5 U.S.C. § 3345(a)(2).

I.

In the Housing and Economic Recovery Act of 2008 (“HERA”), Con- gress established FHFA as “an independent agency of the Federal Gov- ernment” and charged it with supervising and regulating the following mortgage-financing institutions: the Federal National Mortgage Associa- tion (known as “Fannie Mae”) and its affiliates; the Federal Home Loan Mortgage Corporation (known as “Freddie Mac”) and its affiliates; the Federal Home Loan Banks; and the Office of Finance of the Federal Home Loan Bank System. See 12 U.S.C. § 4511(a)−(b). The Director of FHFA is “the head of the Agency,” id. § 4512(a), and is appointed for a five-year term by the President with the Senate’s advice and consent, id. § 4512(b)(1)−(2). An incumbent Director may also continue to “serve as the Director after the expiration of the term for which appointed until a successor has been appointed.” Id. § 4512(b)(4). The FHFA Director is authorized to appoint three deputies: the Deputy Director of the Division of Enterprise Regulation, the Deputy Director of the Division of Federal Home Loan Bank Regulation, and the Deputy Director for Housing Mis- sion and Goals. Id. § 4512(c)−(e). The five-year term of FHFA Director Melvin L. Watt expired on Janu- ary 6, 2019, and he chose to resign rather than hold over until his succes- sor could be appointed. See Letter for the President from Melvin L. Watt, Director, FHFA (Dec. 18, 2018).

II.

Director Watt’s resignation implicated two different statutes, each po- tentially available for naming an Acting Director of FHFA. First, HERA provides that, “[i]n the event of the death, resignation, sickness, or ab-

2 Designating an Acting Director of FHFA

sence of the Director, the President shall designate [one of FHFA’s three Deputy Directors] to serve as acting Director until the return of the Direc- tor, or the appointment of a successor.” 12 U.S.C. § 4512(f ). Second, the Vacancies Reform Act applies to the vast majority of Senate-confirmed offices in the Executive Branch. See 5 U.S.C. §§ 3345(a), 3349c. It is triggered when an officer “dies, resigns, or is otherwise unable to perform the functions and duties of the office,” id. § 3345(a), and it permits the President to designate, as acting officers, certain executive officials, including those who already hold “office[s] for which appointment is required to be made by the President, by and with the advice and consent of the Senate,” id. § 3345(a)(2). 2 Rather than select one of the incumbent Deputy Directors under section 4512(f ), the President sought to designate Joseph M. Otting, the Comp- troller of the Currency, to act as FHFA Director upon Director Watt’s resignation. Because the Comptroller of the Currency is appointed after Senate confirmation, see 12 U.S.C. § 2, the President could designate Mr. Otting if the Vacancies Reform Act were available. Accordingly, we considered whether the President could use that statute or whether section 4512(f ) provides the exclusive means for designating an Acting Director of FHFA. 3 Consistent with our previous opinions about materially similar offices, we concluded and advised that the President may use the Vacan- cies Reform Act to designate an Acting Director of FHFA.

2 Director Watt created a vacancy by resigning from office. See 5 U.S.C. § 3345(a). If the Director had sought to hold over after the expiration of his term, the Vacancies Reform Act would not have been available unless he were removed or otherwise left office before his successor’s appointment. See id. §§ 3345(a), 3349b. Separately, HERA provides that a “vacancy in the position of Director that occurs before the expiration of the term for which a Director was appointed” shall be filled through appointment by the President with the Senate’s advice and consent. 12 U.S.C.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Keim v. United States
177 U.S. 290 (Supreme Court, 1900)
Sebelius v. Cloer
133 S. Ct. 1886 (Supreme Court, 2013)
Epic Systems Corp. v. Lewis
584 U.S. 497 (Supreme Court, 2018)
Patrick Collins v. Steven Mnuchin, Secretar
896 F.3d 640 (Fifth Circuit, 2018)
Swan v. Clinton
100 F.3d 973 (D.C. Circuit, 1996)
Guedes v. Bureau of Alcohol, Tobacco, Firearms, & Explosives
356 F. Supp. 3d 109 (D.C. Circuit, 2019)
Collins v. Mnuchin
908 F.3d 151 (Fifth Circuit, 2018)

Cite This Page — Counsel Stack

Bluebook (online)
Designating an Acting Director of the Federal Housing Finance Agency, Counsel Stack Legal Research, https://law.counselstack.com/opinion/designating-an-acting-director-of-the-federal-housing-finance-agency-olc-2019.