President Trump has selected Neomi Rao, a law professor who contends that the president may remove members of independent agency boards – presumably including the NCUA – as his regulatory chief.
Rao, a law professor at George Mason University, must be confirmed by the Senate before taking office as director of the Office of Management and Budget’s Office of Information and Regulatory Affairs.
Rao has not specifically written about the NCUA board. However, in law review articles and congressional testimony, she has said that the president has power over independent agencies that has never been used or challenged.
That power includes the ability to at will remove a member of an independent agency board – a greatly expanded view of presidential authority.
“All agencies, including the so-called independent agencies, must answer to the President,” she wrote in a 2014 article in the Alabama Law Review.
She added, “The President must be able to remove these officers at will and Congress cannot limit or regulate this authority.”
And in 2011, in an analysis of a case decided by the Supreme Court, she wrote, “The Court’s reasoning strongly suggests that statutory limits on the President’s removal power, such as those protecting the officers of the independent agencies, are unconstitutional.”
That case challenged the Public Company Accounting Oversight Board.
Currently, NCUA board members are nominated for six-year terms. The terms are staggered and no more than two members may belong to the same political party. Board nominees are subject to Senate confirmation. Currently, there is one vacancy on the board.
The House has passed legislation that would require independent agencies to submit proposed and final rules to OIRA. That legislation is pending in the Senate.
Rao has also argued that the president has the power to remove the director of the CFPB at will.
“Agencies that implement the laws, such as the CFPB, undoubtedly exercise the executive power and therefore must be within the control of the President,” she told the Senate Judiciary Committee in 2015.
The issue of the removal of the CFPB director is tied up in federal court, although some Republicans – most notably House Financial Services Chairman Jeb Hensarling (R-Texas) – have said that Trump has the power to fire Director Richard Cordray and should do so immediately.
Rao is the founder and director of George Mason’s Center for the Study of the Administrative State. Before going to George Mason, Rao was an associate counsel and special assistant to President George W. Bush. She also served as counsel to the Senate Judiciary Committee.
