WASHINGTON (AP) — In a second-term Cabinet reshuffle, President Barack Obama tapped San Antonio MayorJulian Castro on Friday to be the nation's next housing secretary, giving a prominent national platform to one of the Democratic Party's most celebrated up-and-comers.

Joined by Castro and Vice President Joe Biden, Obama also announced he was nominating current Housing and Urban Development Secretary Shaun Donovan to run the White House budget office — an opening Obama created when he asked his former budget chief to take over the Health and Human Services Department last month.

"Just because you are of modest means does not mean that your aspirations or your opportunity ought to be limited, and it certainly means you can have the talent to succeed and achieve the American Dream," Castrosaid as he accepted the nomination in the State Dining Room of the White House.

The 39-year-old Castro was propelled into the national spotlight two years ago when Obama chose him to deliver the keynote address at the Democratic National Convention — a political baptism by fire not unlike the president's own rise to prominence when Obama keynoted the 2004 convention. Friday's announcement gives another major boost to Castro's profile, just as Democrats are eyeing him as a potential vice presidential candidate in 2016.

As a Democrat, Castro's options for climbing the political ladder were severely constrained in Texas, where every statewide office is held by a Republican and Democrats haven't won a statewide race in 20 years. In elevating Castro to a Cabinet-level post, Obama gives Castro perhaps his best chance to establish his credibility nationally as Democrats seek to shore up a bench of promising candidates for future races.

"The national scene in Washington is where politicians go to cut their teeth for any sort of national aspirations," said Maria Cardona, a Democratic strategist who advised Hillary Rodham Clinton's 2008 presidential campaign. "This will give him an opportunity to show off what he can do."

Castro, who is Mexican-American, would become one of the highest-ranking Hispanic officials in government if confirmed by the Senate. He comes to Washington with a compelling personal narrative: The son of a single mother, he attended Harvard Law School before serving three terms as San Antonio's mayor. His identical twin brother, Democrat Joaquin Castro, represents Texas in Congress.

Referring to Castro as an "all-star," Obama urged the Senate to confirm both Castro and Donovan quickly and without games.

"They are proven leaders. They are proven managers. They are going to be effective and most importantly, they've got huge heart," Obama said.

Donovan, 48, is highly regarded inside the White House as a strong manager. He is an affordable housing advocate whose work overseeing the federal government's response to the destruction Hurricane Sandy unleashed on the East Coast in October 2012 has earned glowing praise from White House officials, including Obama.

Obama praised Donovan for making the agency more efficient, saving taxpayer dollars and building strong neighborhoods that have reduced homelessness.

"Here's the problem: When you're good at your job, people always want you to do even more," Obama said.

As director of the White House Office of Management and Budget, Donovan would have influence over administration policy and spending. If confirmed by the Senate as expected, Donovan will replace Sylvia Mathews Burwell, whom Obama recently tapped to become secretary of Health and Human Services following Kathleen Sebelius' resignation and the fallout from the disastrous rollout of HealthCare.gov. Burwell is awaiting confirmation.

Obama had sought to bring Castro into the administration in the past, but he decided to stay in the job he says he looked forward to while growing up. Castro handily won a third term in San Antonio last year.

Javier Palomarez, president and chief executive officer of the U.S. Hispanic Chamber of Commerce, saidCastro is a "visionary leader" who has done more than anyone in San Antonio to address the city's housing needs.

"Mayor Castro is not only an exemplary leader within the Hispanic community, but by all measure, a well-suited candidate to lead the department," Palomarez said. "With great consistency, Mayor Castro has set aside political partisanship in the name of good policy decision making. We hope his confirmation process will proceed with that same collaborative spirit."

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 (Photo: AP Photo/Charles Dharapak, File)