Legal Sidebari

Organizing Executive Branch Agencies: Who
Makes the Call?
June 27, 2018
In a series of executive orders, directives, and publicly released recommendations, the Trump
Administration has proposed reorganizing the executive branch. The reorganization proposals range from
restructuring entities within an existing agency, to moving entities from one existing agency to another, to
consolidating existing agencies into newly created departments, to privatizing certain government
agencies. The Administration has indicated that it considers some of these proposals to be within its
existing authority, while others may require new legislation authorizing such action. These orders and
proposals have prompted a recurring question concerning the composition of the federal government: who
decides how to organize agencies and departments within the executive branch? The ultimate answer to
this question is Congress. Legislative enactments create executive agencies and delegate authority to
those entities to carry out various statutory functions and duties. But executive branch agencies also
typically enjoy some discretion in determining how best to structure themselves to carry out their
statutory responsibilities, provided that reorganization does not conflict with their governing statutes or
legislative funding restrictions. This Legal Sidebar lays out the applicable legal considerations relevant to
analyzing potential agency reorganizations; for consideration of the potential policy implications of such
executive branch action, see this CRS Insight.
Constitutional Principles
As an initial matter, the respective constitutional authorities of the political branches guide any discussion
of the organization of executive branch agencies. Agencies within the executive branch are established
pursuant to legislation enacted by Congress. In particular, Congress may act pursuant to its specific,
enumerated authorities to establish such agencies. Congress’s power to establish agencies may be
enhanced by the Necessary and Proper Clause, which permits Congress to enact laws that are convenient,
useful, or conducive to the exercise of Congress’s enumerated powers. The Necessary and Proper Clause
also enables Congress to enact legislation to assist in the execution of other provisions of the Constitution,
including aiding the President in carrying out his own constitutional duties (e.g., the establishment of the
Office of the Pardon Attorney in the Department of Justice to assist the President in carrying out the
pardon power). Agencies created by Congress generally are limited to taking actions authorized by law
and must comply with statutory restrictions placed on those agencies’ structure and scope of authority.
Congressional Research Service
https://crsreports.congress.gov
LSB10158
CRS INSIGHT
Prepared for Members and
Committees of Congress

---

Congressional Research Service
2
This means that efforts to reorganize executive branch entities must locate power to do so within existing
statutory authority or additional legislation permitting the action.
The Constitution also separates the power to create executive branch offices from the power to appoint
the leadership of those entities. The Appointments Clause of the Constitution provides that those principal
“officers” not expressly mentioned in the Constitution (i.e., individuals who exercise significant authority
and report directly to the President), but “established by law,” must be appointed by the President and
confirmed by the Senate. Congress “may by law” place the power of appointment for “inferior officers”
with the President alone, a department head, or a court of law. The Constitution thus provides that
Congress establishes executive branch offices via enacted legislation (other than those executive branch
components expressly created by the Constitution), but places the power of appointment of the heads of
executive branch departments with the President, subject to Senate confirmation. The Appointments
Clause therefore offers another constraint upon the executive branch’s ability to reorganize itself without
congressional authorization. Any reorganization plan that aims to unilaterally create a free-standing
constitutional “office” likely requires additional legislation to implement, and that office must be headed
by an officer appointed by the President and confirmed by the Senate. Notably, the executive branch itself
has concluded that the President generally lacks independent power to create a new federal office headed
by a principal officer.
Further, Congress enjoys the power of the purse on account of its spending power and the prohibition the
Appropriations Clause places upon the spending of money drawn from the Treasury except pursuant to an
authorizing statute. And under the Anti-Deficiency Act, federal officers and employees are barred from
spending money that exceeds appropriated funds. The consequence of these statutory and constitutional
constraints upon agencies’ use of federal funds not only affects how those entities may spend allocated
money, but also limits executive discretion to transfer functions performed by one executive branch
component to another. If Congress appropriates funds to a specific executive branch entity to implement a
particular function or duty, the executive branch may not reassign those funds to a different entity to carry
out those authorities without further legislative authorization.
Nevertheless, Congress’s authority over the structure and functions of executive agencies and
departments is not all-encompassing. External constraints found elsewhere in the Constitution may place
some limits on congressional control over agency functions. For example, Congress cannot compel the
State Department to perform functions which contravene the President’s exclusive power to recognize a
foreign state. The Constitution also vests the President with the power to execute the laws and permits the
appointment of executive branch officers, confirmed by the Senate, to help him do so. And while the
Appointments Clause restrains the ability of the executive branch to unilaterally create and appoint its
own principal officers, it also bars Congress from creating an agency headed by a principal officer over
whom Congress, rather than the President, retains control.
More generally, because delegations of statutory authority are often written broadly, at least some
residuum of discretion is typically inherent in the execution of the law. In fact, some statutes explicitly
allow certain agencies to reorganize within circumscribed limits; others authorize agencies to manage
their own affairs, which may include establishing offices or delegating authority; and another authorizes
the President to delegate powers statutorily granted to him. In sum, statutory grants of authority to
executive branch agencies often expressly or impliedly confer those agencies with some discretion over
how they organize themselves to carry out their responsibilities under the law.
Reorganization Practice for Executive Agencies
As a practical matter, individual agencies often reorganize themselves within the statutory limitations
placed by Congress. Statutory authorizations to an agency often do not precisely specify a particular
entity that must carry out a function or duty. What might be referred to as an “intra-agency”

---

Congressional Research Service
3
reorganization could include delegating, re-delegating, or even sub-delegating duties and functions within
an agency as authorized by statute. Likewise, an intra-agency reorganization might involve the
establishment, modification, or transfer of various entities pursuant to discretionary authority conferred by
statute. For example, pursuant to its statutory authority to organize the Department of Homeland Security
(DHS), the Secretary of DHS moved the Federal Air Marshal Service from the Transportation Security
Administration (TSA) to another DHS component, Immigration and Customs Enforcement, in 2003, and
then moved it back to TSA in 2005. Moreover, as previously noted, the President is authorized by statute
to delegate functions and duties expressly vested in him by Congress from one agency to another. For
instance, the President has sometimes authorized the Secretary of the Treasury to carry out the powers
vested to President by the International Emergency Economic Powers Act when declaring a national
emergency.
Authorizing legislation has been understood as necessary for government-wide reorganizations which
involve, for example, transferring entities from one agency or department to another, or combining two or
more agencies into a newly created department. In some instances, details of an executive reorganization
were largely established via legislation that did not delegate notable reorganization authority to the
President, such as the National Security Act of 1947 (and its amendment in 1949), which, among other
things, created the Department of the Air Force and reorganized the military branches into the Department
of Defense. In other instances, Congress has explicitly granted the President substantial reorganization
authority. For example, under a since-expired statute, the President was authorized to submit wide-
ranging reorganization plans to Congress that would go into effect unless one or both houses of Congress
passed a resolution rejecting the plan (a procedure known as a “legislative veto”). This process was used
to create the Environmental Protection Agency. However, Congress allowed that reorganization authority
to expire shortly after the Supreme Court, in a different context, ruled that legislative vetoes were
unconstitutional. More recently, Congress expressly permitted the President to transfer certain executive
branch functions and duties into the newly established DHS, subject to a joint resolution of disapproval
(that reorganization authority also has since expired).
The extent of discretion afforded under various historical reorganization authorities conferred by
Congress has typically remained untested. This is perhaps because of difficulties establishing standing in
federal court to challenge a reorganization. When disputes have arisen between Congress and the
executive branch concerning agency reorganization, such disputes often have been worked out between
the political branches through accommodation and compromise.
The limited number of cases that address delegations of agency authority have typically involved an
agency head’s delegating power to a lower-level official. Courts generally have upheld such delegations
of authority unless a statute has precluded the action. Courts have also observed that agencies often
possess statutory authority to establish entities within those agencies to carry out their statutory duties and
functions. That said, agencies cannot contradict the terms of a governing statute or a relevant
appropriations measure.
Application to the Trump Administration’s Proposed Executive Branch
Reorganization
The Trump Administration has indicated that it considers some of its reorganization proposals to be
within its existing administrative discretion, although “more significant changes” will require
congressional action. As discussed above, determining the extent of the executive branch’s power to
reorganize requires consideration of the scope of a particular agency’s statutory authority. In other words,
how much discretion has Congress bestowed on an agency to reshape itself?
Some, though not necessarily all, of the Trump Administration’s reorganization proposals appear likely to
require authorizing legislation from Congress. For instance, proposals to transfer an entity or function

---

Congressional Research Service
4
vested by Congress in a particular agency to another agency, or to combine statutorily created entities
into a new department, likely require new legislation authorizing the action. Likewise, a proposal to
privatize an agency and eliminate it from the federal government would require congressional
authorization (privatization of federal government agencies may raise additional constitutional questions
not addressed in this Sidebar). Whether a proposed reorganization that would transfer functions or duties
within an agency to another part of the same agency requires congressional authorization would depend
on the particular governing statute and appropriations specific to that agency. And a plan that would
redelegate authority that is statutorily vested in the President from one agency head to another is unlikely
to require new legislation authorizing the move given existing statutory authorization (assuming the plan
does not violate a relevant appropriations provision). Executive authority to implement any reorganization
proposal ultimately will depend on the circumstances of the particular plan at issue and the precise scope
of authority delegated by Congress.


Author Information

Jared P. Cole

Legislative Attorney




Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
CRS Reports, as a work of the United States Government, are not subject to copyright protection in the United
States. Any CRS Report may be reproduced and distributed in its entirety without permission from CRS. However,
as a CRS Report may include copyrighted images or material from a third party, you may need to obtain the
permission of the copyright holder if you wish to copy or otherwise use copyrighted material.

LSB10158 · VERSION 3 · NEW

---