H.R. 4975: TOO LATE Act
Sponsor
Earl Carter
Republican · GA-1
Bill Progress
Latest Action · Aug 15, 2025
Referred to Financial Services, and in addition to the Committee on Rules, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned. for review
Why it matters
With interest rates still central to inflation, jobs, and borrowing costs, H.R. 4975 would give the President a new tool to remove the Federal Reserve Chair based on a specific 200-basis-point test lasting two consecutive quarters.
Congress then has a mandatory oversight role. Not later than 30 days after the President issues the statement, the House Committee on Financial Services and the Senate Committee on Banking, Housing, and Urban Affairs must hold hearings to analyze the justification. The bill also defines “Federal funds target rate” very specifically as the upper bound of the target range for the Federal funds rate established by the Federal Open Market Committee, which matters because the removal test depends on that exact number.
What does H.R. 4975 do?
President can remove Fed Chair after 200-basis-point miss
The bill lets the President remove the Chair of the Board of Governors of the Federal Reserve System if the Federal funds target rate deviates by more than 200 basis points from the average generated by any two of three listed benchmarks, and the deviation lasts for two consecutive quarters.
Three benchmark test includes 5-year Treasury spread
The removal test uses any two of three benchmarks: the Implicit Price Deflator for Personal Consumption Expenditures; the spread between a 5-year Treasury bond and a 5-year Treasury Inflation-Protected Security; and the gap between the Board’s unemployment estimates and Congressional Budget Office projections.
President must publish a justification statement
Before or when removing the Fed Chair, the President must issue a statement that gives justification, includes references to benchmark data, discusses the conduct of monetary policy, submits the statement to Congress, and makes it publicly available.
Congressional hearings required within 30 days
Not later than 30 days after the President issues the justification statement, the House Committee on Financial Services and the Senate Committee on Banking, Housing, and Urban Affairs must hold hearings to analyze the reasons for the Chair’s removal.
Bill defines target rate as upper bound
The bill defines the “Federal funds target rate” as the upper bound of the target range for the Federal funds rate set by the Federal Open Market Committee, narrowing the removal test to one specific figure rather than the whole target range.
Amends Section 10 of Federal Reserve Act
H.R. 4975 amends Section 10 of the Federal Reserve Act, cited at 12 U.S.C. 241 et seq., by redesignating existing paragraph (12) as paragraph (11) and inserting a new paragraph (12) titled “Cause for removal.”
Who benefits from H.R. 4975?
Presidents seeking more control over Fed leadership
The bill gives the President a clearer legal pathway to remove the Fed Chair when a measurable threshold is met: a deviation of more than 200 basis points for two consecutive quarters.
Congressional oversight committees
The House Committee on Financial Services and the Senate Committee on Banking, Housing, and Urban Affairs would get a guaranteed review role, with hearings required within 30 days after a removal justification is issued.
Public and financial market watchers
They would get more transparency because any removal would require a public justification statement with benchmark data and an explanation of monetary policy decisions.
Lawmakers favoring rules-based monetary accountability
The bill turns a broad debate about Fed performance into a concrete test tied to three named benchmarks, a 200-basis-point threshold, and a two-consecutive-quarter duration.
Who is affected by H.R. 4975?
Chair of the Federal Reserve Board
The Fed Chair would face a new statutory removal risk if the upper bound of the federal funds target range diverges by more than 200 basis points from the average of any two benchmarks for two straight quarters.
Federal Open Market Committee and Board staff
Because the bill defines the relevant rate as the upper bound set by the Federal Open Market Committee and compares policy against Board unemployment estimates and market-based measures, internal forecasting and rate-setting decisions would come under sharper political scrutiny.
Borrowers, savers, and investors
They could be indirectly affected if the threat of removal changes how the Fed sets rates, especially since the bill centers on the federal funds target rate and 5-year Treasury and TIPS market signals that influence broader borrowing costs.
Congressional Budget Office
CBO projections would become part of a statutory removal benchmark because one of the three tests compares the Board’s unemployment estimates to Congressional Budget Office projections.
H.R. 4975 Common Questions
Can the President remove the Fed Chair for missing interest rate targets by 200 basis points?
Yes. Under the TOO LATE Act (SEC. 2), the President could remove the Fed Chair if the federal funds target rate is more than 200 basis points off the average of any two listed benchmarks for two consecutive quarters.
How long would the Fed rate have to miss the benchmark before the Chair can be removed?
Under the TOO LATE Act (SEC. 2(A)), the deviation must last for two consecutive quarters before the President can remove the Chair.
What are the benchmarks used to judge whether the Fed Chair can be removed?
According to H.R. 4975 SEC. 2(A), the test uses any two of three benchmarks: PCE implicit price deflator, the 5-year Treasury minus 5-year TIPS spread, and the Board's unemployment estimates relative to CBO projections.
Does the bill use the upper bound of the federal funds rate range or the whole range?
It uses the upper bound only. Under the TOO LATE Act (SEC. 2(D)), 'Federal funds target rate' means the upper bound of the target range set by the FOMC.
Can the President remove the Fed Chair without publicly explaining why?
No. Under the TOO LATE Act (SEC. 2(B)), the President must issue a justification statement, submit it to Congress, and make it publicly available.
What must the President's statement include when removing the Fed Chair?
According to H.R. 4975 SEC. 2(B), the statement must include references to benchmark data and a discussion of the conduct of monetary policy.
Which congressional committees would have to hold hearings if the Fed Chair is removed?
Under the TOO LATE Act (SEC. 2(C)), the House Financial Services Committee and the Senate Banking, Housing, and Urban Affairs Committee must hold hearings.
How soon would Congress have to hold hearings after the President removes the Fed Chair?
According to H.R. 4975 SEC. 2(C), the required House and Senate committee hearings must happen within 30 days after the President issues the justification statement.
Does the bill compare Fed unemployment estimates to Congressional Budget Office projections?
Yes. Under the TOO LATE Act (SEC. 2(A)), one benchmark is the difference between the Board's unemployment estimates and CBO projections.
Does H.R. 4975 amend Section 10 of the Federal Reserve Act?
Yes. According to H.R. 4975 SEC. 2, the bill amends Section 10 of the Federal Reserve Act and adds a new paragraph (12) on 'Cause for removal.'
Based on H.R. 4975 bill text
HR4975 Legislative Journey
House: Committee Action
Aug 15, 2025
Referred to the Committee on Financial Services, and in addition to the Committee on Rules, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
About the Sponsor
Earl Carter
Republican, Georgia's 1st congressional district · 11 years in Congress
Committees: Energy and Commerce, the Budget
View full profile →
Committee Sponsors
Rules Committee
0 of 13 committee members cosponsored
No committee members have cosponsored this bill
Financial Services Committee
0 of 54 committee members cosponsored
No committee members have cosponsored this bill
38 Republicans across these committees haven't cosponsored yet. Mobilize their constituents
H.R. 4975 Quick Facts
- Committee
- Rules
- Chamber
- House
- Policy
- Finance and Financial Sector
- Introduced
- Aug 15, 2025
Referred to Financial Services, and in addition to the Committee on Rules, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned. for review
Aug 15, 2025
Official Sources
Official Congress.gov page for the TOO LATE Act with bill text, actions, and status.
Official Federal Reserve page explaining the Board of Governors, including the Chair role affected by this bill.
Official FOMC page relevant because the bill defines the federal funds target rate as the upper bound set by the FOMC.
Official Federal Reserve explanation of policy tools and the federal funds rate targeted by the bill's removal test.
Official BEA page for PCE price data, relevant to the bill's benchmark referencing the implicit price deflator for personal consumption expenditures.
Official CBO topic page relevant because the bill uses CBO projections as part of one removal benchmark.
Official U.S. Code page for Title 12 banking law, relevant because the bill amends Section 10 of the Federal Reserve Act at 12 U.S.C. 241 et seq.
H.R. 4975 Bill Text
“To amend the Federal Reserve Act to establish procedures for removal of the Chairman of the Board of Governors of the Federal Reserve System, and for other purposes.”
Source: U.S. Government Publishing Office
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