Limitations on Presidential Power to Create a
   New Executive Branch Entity to Receive and Administer
           Funds Under Foreign Aid Legislation

The President lacks constitutional and statutory authority to create a new entity within the
  Executive Branch to receive and adm inister funds appropriated under the International Secu­
  rity and D evelopm ent Act o f 1985 (ISD A).

The A ppointm ents Clause in the Constitution requires that “offices” o f the United States be
  established “by Law .” Any agency created to receive and adm inister funds appropriated under
  the ISD A would have to be headed by an officer o f the United States, who would occupy an
  “office” o f the U nited States. Such new offices o f the United States must be created or
  authorized by C ongress through enactm ent of legislation.

Presidential creation o f the United States Sinai Support M ission under Executive Order No.
   11896 does not provide persuasive precedent for Presidential creation o f a new agency to
   adm inister funds under the ISDA. In that situation, the President was able to rely upon
   authorization provided by §631 o f the Foreign Assistance Act of 1961, which gave the
   President pow er to establish “m issions” abroad.

                                                                                  August 23, 1985

         M   em orandum      O   p i n io n f o r t h e   C o un sel   to the   P r e s id e n t


  As you know, § 722(g) of the recently enacted International Security and
Development Act of 1985 (ISDA) authorizes $27 million to be appropriated
“for hum anitarian assistance to the Nicaraguan democratic resistance.” That
section provides, in part:
         Effective upon the date o f enactment of this Act, there are
         authorized to be appropriated $27,000,000 for humanitarian
         assistance to the Nicaraguan democratic resistance. Such assis­
         tance shall be provided to such department or agency of the
         United States as the President shall designate, except the Central
         Intelligence Agency or the Department of Defense.
131 Cong. Rec. 21248 (1985). T he President has not yet designated an agency
or departm ent to receive the assistance authorized by the ISDA. Certainly, this
legislation authorizes the President to designate an existing agency or depart­
ment o f the United States, such as the State Department, the Agency for
International Development, or the Executive Office of the President, to receive
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and thereupon to disburse the assistance. This designation could be accom­
plished in several ways, from a formal executive order to an oral directive from
the President.
   A more difficult question is whether the President could create a new entity
within the Executive Branch, independent of existing agencies and depart­
ments, to receive the assistance and administer the program. We conclude that
in these circumstances the President lacks constitutional and statutory authority
to do so.
   Our conclusion is based on the language in the Appointments Clause o f the
Constitution, which appears to vest responsibility for creating offices of the
United States in Congress:
       [The President] shall nominate, and by and with the Advice and
       Consent of the Senate, shall appoint Ambassadors, other public
       Ministers and Consuls, Judges of the supreme Court, and all
       other Officers o f the United States, whose Appointments are not
       herein otherwise provided for, and which shall be established by
       Law . . . .
U.S. Const, art. II, § 2, cl. 2 (emphasis added). To our knowledge the question
has never been definitively adjudicated, but the language of the Appointments
Clause and the historic practice of the Executive and Legislative Branches
suggests strongly that offices of the United States must be created by Congress.
Professor Corwin has noted, for example:
       The Constitution . . . by the “necessary and proper” clause as­
       signs the power to create offices to Congress, while it deals with
       the appointing p o w er in the . . . words of Article II, section 2,
       paragraph 2 . . . . An appointment is, therefore, ordinarily to an
       existing office, and one which owes its existence to an act of
       Congress.
Corwin, The President: Offices and Pow ers 83 (1948). See also The Constitu­
tion o f the United States o f America, Analysis and Interpretation, 92d Cong.,
2d Sess. 523(1973):
       That the Constitution distinguishes between the creation o f an
       office and appointment thereto for the generality of national
       offices has never been questioned. The former is by law and
       takes place by virtue of Congress’s power to pass all laws
       necessary and proper for carrying into execution the powers
       which the Constitution confers upon the government of the
       United States and its departments and officers.
This dichotomy between creation of the office and appointment to the office is
consistent with the historic view of the Executive and Legislative Branches as
respects the proper division of constitutional responsibility. Congress has
provided by statute for the establishment of Executive Branch agencies and
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particular positions within those agencies, and the President or heads of those
agencies select individuals to fill those positions. Except as specifically pro­
vided by law, the President assigns responsibilities to those agencies and
positions to carry out the laws. This understanding has also generally been
reflected in the Executive Branch’s acquiescence in the need for reorganization
legislation in order to restructure or consolidate agencies within the Executive
Branch.
   We believe that any agency created by the President to implement § 722(g)
would, o f necessity, have to be directed by an officer of the United States
within the meaning o f Buckley v. Valeo, 424 U.S. 1, 126 (1976) (per curiam),
who would occupy an “office” o f the United States. Because that office would
be created independent of any other agencies or departments of the Executive
Branch, that office would clearly be a new office. Therefore we do not believe
that, absent statutory authorization, the President would have authority to
create such an office.1
   W e have not found adequate statutory authority either in the ISDA or in the
Foreign Assistance Act of 1961, 22 U.S.C. §§ 2151-2429a, to allow the Presi­
dent to create a new office to implement the humanitarian assistance program.
Under the ISDA, the President “shall designate” “such agency or department of
the United States” as he deems appropriate to administer the program. On its
face, that language appears to contemplate that the assistance will go to an
existing agency or department. At least in the absence of some legislative
history suggesting that Congress understood that the program would be admin­
istered through a new agency (which we have not found), we cannot read that
language affirmatively to authorize the President to create an entity outside of
existing agencies or departments. In similar language, the Foreign Assistance
Act provides authority to the President to delegate functions “to such agency or
officer o f the United States Government as he shall direct.” 22 U.S.C. § 2381.
Again, there is nothing in that language to suggest that Congress intended or
contemplated that the President could create a wholly new administrative
entity, outside structures within the Executive Branch, to fulfill those statutory
responsibilities. Therefore, we do not believe that the President could create a
new agency outside of existing Executive Branch agencies and departments
and designate that agency to receive the appropriated funds and implement the
program of hum anitarian assistance.

  1 W e do not m ean to suggest that the P resident does not have some residuum o f inherent constitutional
authority to create offices o r agencies, based on the direction in Article II, § 1, that the “executive Power”
shall be vested in the President, and the m andate in A rticle II, § 3 that he “take C are that the Laws be
faithfully ex ecu ted .” Such authority seems to be contem plated by 31 U .S.C. § 1347, which provides that “[a]n
agency in existence fo r m ore than one year m ay not use am ounts otherw ise available for obligation to pay its
expenses w ithout a specific appropriation o r specific authorization by law," and specifically refers to
agencies “established by executive order.” S ection 1347 obviously cannot be read as an affirm ative grant of
authority to the President to create agencies by executive order, and we therefore do not believe that we can
rely on that language here to overcome the express language o f the A ppointm ents Clause. There may be
cases, how ever — in a national emergency, fo r exam ple — in which we would conclude that the President
m ay, in effect, create an office in order to c a rry out constitutional responsibilities that otherwise could not be
fulfilled.

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    We are aware of one entity that has been advanced as precedent for Presiden­
 tial creation of such an agency. In Executive Order No. 11896 (Jan. 13, 1976),
 reprinted in 41 Fed. Reg. 2067 (1976), the President created the United States
 Sinai Support Mission to assist in the implementation of the “United States
 Proposal for the Early Warning System in Sinai.” The letter prepared by the
 Office of Management and Budget to the Attorney General supporting the
executive order recited that the mission was intended to be a “separate, inde­
 pendent mission, outside of the Department of State.”
    We do not believe that Executive Order No. 11896 is a clear precedent for
creation o f an independent agency to implement the Nicaraguan humanitarian
aid program. As the OMB letter notes, the President was able in that instance to
rely on the specific congressional authorization provided by § 631 of the
Foreign Assistance Act of 1961, 22 U.S.C. § 2391, which gives the President
the power to establish “missions” abroad. This specific authority would not
appear to be available here. Second, the circumstances surrounding the adop­
tion of the Joint Resolution of October 13, 1975, Pub. L. No. 94-110, 89 Stat.
572 (1975), by which Congress authorized the establishment of a monitoring
force to implement the “United States Proposal for the Early Warning System
in Sinai,” provide some evidence that Congress contemplated the creation of a
new agency to fulfill the objective of the Resolution. Congress was specifically
aware that a force of two hundred civilians was needed to monitor the system.
As there were few precedents for such a civilian monitoring force and no
agency with obvious expertise in providing such services, it is not unreasonable
to infer that Congress contemplated that the President, pursuant to his broad
authorization to implement the monitoring proposal, might create a new agency
to serve as the monitoring force.
    As set forth above, § 722(g) of the ISDA, however, does not provide similar
support for an inference that Congress intended to empower the President to
create a new agency. Furthermore, the Sinai Support Mission received its
allocation of funds from the Secretary of State rather than the President, see
Exec. Order No. 11896, § 5, and the Secretary of State was ordered to exercise
“continuous supervision and general direction” of the activities of the Mission,
id. at § 1(b). The vesting of the combined power to supervise and allocate funds
in the Secretary raises a serious question as to the formal independence of the
Mission and suggests that the Mission should, as a technical matter, probably
be considered to have been within the Department of State. Thus, we do not
view the creation of the Sinai Mission as particularly useful precedent here.
    In conclusion, we believe that the assistance authorized for Nicaraguan
humanitarian relief must be channeled through an existing department or
agency of the United States. We believe that creation of a new agency to
administer the program outside of the confines of existing agencies and depart­
ments would raise substantial constitutional questions, and we therefore could
not approve a Presidential directive purporting to establish such an agency. The
question of which agency or department should be designated to provide the
assistance authorized by § 722(g) is one of policy; aside from the prohibition
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against use of the Central Intelligence Agency or the Department of Defense,
the ISDA gives no guidance and places no limitations on the choice of agency
or department.

                                                  Ra lph W . T arr
                                         Acting A ssistant Attorney General
                                              Office o f Legal Counsel




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