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It-tiding cooperative associations or other organizations of producers of any agricultural commodity, or upon its own metlon, the boiirtl shall investigate the supply mul marketing situation in respect of such agricultural commodity.

"(b) Whenever upon such investigation the board finds—•

"First. That there is or may be during the ensuing year a seasonal or year's total surplus, produced in the United States and national in extent, that is in excess of the requirements for the orderly marketing of any agricultural commodity or In excess of the domestic reiiuiretnents for the commodity;

"Second. That the operation of the provisions of section 5 (relating to loans to cooperative associations or corporations (-.ented and controlled by one or more cooperative associations) will not be effective to control such surplus because of the inability or unwillingness of the cooperative associations engaged in handling the commodity, or corporations created and controlled by one or more such cooperative associations, to control such surplus with the assistance of such loans; and

"Third. That the durability, the conditions of preparation, processing, and preserving, and the methods of marketing of the commodity are such that the commodity is adapted to marketing as authorized by this section ;—

then the board, after publicly declaring its findings, shall arrange for marketing any part of the commodity by means of marketing agreements with cooperative associations engaged in handling the commodity or corporations created and controlled by one or more cooperative associations. Such marketing shall continue during a marketing period which shall terminate at such time as the board finds that such arrangements are no longer necessary or advisable for carrying out the policy declared l>y section 1.

"(c) A marketing agreement shall provide either—

"(I) For the withholding by a cooperative association, or corporation created and controlled by one or more cooperative associations, during such period as shall be provided in the agreement, of any part of the commodity delivered to such cooperative association or associations by its members. Any such agreement shall provide for the payment from the stabilization fund for the commodity of the costs arising out of such withholding; or

"(2) For the purchase by a cooperative association, or corporation credited and controlled by one or more cooperative associations, of any part, of the commodity not delivered to such cooi>erative association or associations by its members, and for tue withholding and disposal of the commodity so purchased. Any such marketing agreement shall provide for the payment from the stabilization fund for the commodity of the amount of the losses, costs, and charges arising out of the purchase, withholding, iintl disposal, or out of contracts therefor, and for the payment into the stabilization fund for the commodity of profits (after repaying all advances from the stabilization fund iind deducting ail costs and charges, provided for in the agreement) arising out of the purchase, withholding, and disposal, or out of contracts therefor.

"(d) The board may, in its discretion, provide in any such marketing agreement for financing any withholding, purchase, or disposal under such agreement, through advances from the stabilization found for the commodity. Such financing shall be upon such terms as the board may prescribe, but no such advance shall bear interest.

"(e) If the board is of the opinion that there are two or more eoiip<-rative associations or corporations created and controlled by one or more cooperative associations capable of carrying out auy marketing agreement, the board in entering into the agreement shall not unreasonably discriminate against any such association or corporation in favor of any other such association or corporation. If the board is of the opinion that there is no such cooperative association or corporation created and controlled by one or more cooperative associations capable of carrying out auy marketing agreement for purchase, withholding, and disposal, then the board may enter into the agreement with other agencies but shall not unreasonably discriminate between such other agencies.

'•(f) During a marketing period fixed by the board for any commodity, the board may enter into marketing agreements for the purchase, withholding, and disposal of the food products of each commodity, and all provisions of this section applicable to m.-irki'ting agreements for the purchase, withholding, and dispivsul of the commodity, shall apply to the agreements in respect of its food products.

"(g) Any decision of the board relating to the commencement, extension, or termination of a marketing period shall require the affirmative vote of a majority of the appointed members in office.

"(h) The powers of the board under this section in respect of any agricultural commodity shall be exercised in such man

ner, and the marketing agreements entered into by the board during any marketing period shall be upon such terms, as will, in the judgment of the board, carry out the policy declared by section 1.

"(i) The United States shall not be liable, directly or indirectly, upon agreements under this act in respect of agricultural commodities, in excess of the amounts available in the stabilization, premium insurance, and revolving funds.

"EQUALIZATION FEE

"Sec. 9. (a) In order to carry out marketing and uonpreinium insurance agreements in respect of any agricultural commodity without loss to the revolving fund, each marketed unit of such agricultural commodity produced in the United States shall, throughout any marketing period in respect of such commodity, contribute ratably its equitable share of the losses, costs, and charges arising out of such agreements. Such contributions shall be made by means of an equalization fee apportioned and paid as a regulation of interstate and foreign commerce in the commodity. It shall be the duty of the board to apportion and collect such fee in resitect of such commodity as hereinafter provided.

"(b) Prior to the commencement of any marketing period in respect of any agricultural commodity, and thereafter from time to time during such marketing period, the board shall estimate the probable losses, costs, and charges to be paid under marketing agreements in respect of such commodity and under nonpremium insurance agreements in respect of such commodity as hereinafter provided. Upon the basis of such estimates, the board shall from time to time determine and publish the amount of the equalization fee (if any is required under such estimates) for each unit of weight, measure, or value designated by the board, to be collected upon such unit of such agricultural commodity during any part of the marketing period for the commodity. Such amount is referred to in this Act as the 'equalization fee.' At the time of determining and publishing any equalization fee the board shall specify the time during which the particular fee shall remain in effect and the place and manner of its payment and collection.

"(c) Under .such regulations as the board may prescribe, any equalization fee determined upon by the board shall be paid, in respect of each marketed unit of such commodity, upon one of the following: The transportation, processing, or sale of such unit. The equalization fee shall not be collected more than once in respect of any unit. The board shall determine, in the case of each class of transactions in the commodity, whether the equalization fee shall be paid upon transportation, processing, or sale. The board shall make such determination upon the basis of the most effective and economical means of collecting the fee with respect to each unit of the commodity marketed during the marketing period.

"(d) When any equalization fee is collected with respect to cattle or swine, an equalization fee equivalent in amount, as nearly as may be, shall be collected, under such regulations as the board may prescribe, upon the first sale or other disposition of any food product derived in whole or in part from cattle or swine, respectively, if the food product was on hand and owned at the time of the commencement of the marketing period: Prodded, That any food product owned in good faith hy retail dealers at the time of the commencement of the marketing period shall be exempt from the operation of this subdivision.

"(e) Under such regulations as the board may prescribe, the equalization fee determined under this section for any agricultural commodity produced in the United States shall in addition be collected upon the importation of each designated unit of the agricultural commodity imported into the United States for consumption therein, and an equalization fee, in an amount equivalent as nearly as may be. shall be collected upon the importation, of any food product derived in whole or in part from the agricultural commodity and imported into the United States for consumption therein.

"(f) The board may by regulation require any person engaged in the transportation, processing, or acquisition by purchase of any agricultural commodity produced in the United States, or in the importation of any agricultural commodity or food product thereof—

"(1) To tile returns under oath and to report, in respect of his transportation, processing, or acquisition of such commodity produced in the United States or in respect of his importation of the commodity or food product thereof, the amount of equalization fees payable thereon and such other facts as may be necessary for their payment or collection.

"(2) To collect the equalization fee as directed by the board and to account therefor.

"(g) The board, under regulations prescribed by it, is authorized to pay to any such person required to collect such fees a reasonable charge for his services.

"(h) Every person who, in violation of the regulations prescribed by tlie board, fails to collect or account for any equalization fee shall be liable for its amount aud to a penalty equal to one half its amount. Such amount and penalty may be recovered together in n civil suit brought by the board in the name of the United States.

"(i) As used in this section—

"(1) In the case of grain the term 'processing' means milling of grain for market or the first processing in any manner for market (other than cleaning or drying) of grain not so milled, and the term 'sale' means a sale or other disposition in the United States of grain for milling or other processing for market, for resale, or for delivery by a common carrier— occurring during a marketing period in respect of grain.

"(2) In the cafe of cotton the term 'processing' means spinning, milling, or any manufacturing of cotton other than ginning; the term 'sale' means a sale or other disposition in the Uriiled States of cotton for spinning, milling, or any manufacturing other than ginning, or for delivery outside the United States; aud the term 'transportation' means the acceptance of cotton by a common carrier for delivery to any person for spinning, milling, or any manufacturing of cotton other than ginning, or for delivery outside the United States—occurring during a marketing period in respect of cotton.

"(3) In the case of livestock, the term 'processing' means slaughter for market by a purchaser of livestock, aud the term 'sale' means a sale or other disposition in the United States of livestock destined for slaughter for market without intervening holding for feeding (other than feeding in transit) or fattening—occurring during a marketing period in respect of livestock.

"(4) In the case of tobacco, the term 'sale' means a sale or other dis]K>sitiou to any dealer in leaf tobacco or to any registered manufacturer of the products of tobacco. The term 'tobacco' means leaf tobacco, stemmed or uristeinmed.

"(5) In the case of grain, livestock, and tobacco, the term 'transportation' means the acceptance of the commodity by a common carrier for delivery.

"(6) In the case of any agricultural commodity other than grain, cotton, livestock, or tobacco, the board shall, in connection with its specification of the place and manner of payment and collection of the equalization fee, further specify the particular type of processing, sale, or transportation in respect of which the equalization fee is to be paid and collected.

"(7) The term 'sale' does not include a transfer to a cooperative association for the purpose of sale or other disposition by such association on account of the transferor; nor a transfer of title in pursuance of a contract entered into before, and at a specified price determined before, the commencement of a marketing period in respect of the agricultural commodity. In case of the transfer of title in pursuance of a contract entered into after the commencement of a marketing period in respect of the agricultural commodity, but entered into at a time when, and at a specified price determined at a time during which a particular equalization fee is in effect, then the equalization fee applicable in respect of such transfer of title shall be the equalization fee in effect at the time when such specified price was determined.

"stabilization Pi;nds

"Sec. 10. (a) For each agricultural commodity as to which marketing agreements are made by the board there shall be established, in accordance with regulations prescribed by the board, a stabilization fund. Such fund shall be administered by and exclusively under the control of the board, and the board shall have the exclusive power of expending the moneys in such fund.

"(b) There shall be deposited to the credit of the stabilization fund for any agricultural commodity (1) advances from the revolving fund as hereinafter authorized, (2) profits arising out of marketing agreements in respect of the commodity, (3) repayments of advances for financing the purchase, withholding, or disposal of the commodity, and (4) equalization fees collected in respect of the commodity and its imported food products.

"(c) In order to make the payments required by a marketing or nonpremium insurance agreement in respect of any agricultural commodity, and in order to pay the salaries and expenses of experts, the board may, in its discretion, advance to the stabilization fund for such commodity out of the revolving fund such amounts as may be necessary.

"(d) The deposits to the credit of a stabilization fund shall be made in a public depositary of the United States. All general laws relating to the embezzlement, conversion, or to the improper handling, retention, use, or disposal of public moneys of the United States shall apply to the profits and equalization fees payable to the credit of the stabilization fund and to moneys deposited to the credit of the fund or withdrawn there

from but in the custody of any officer or employee of the United States.

"(e) There shall be withdrawn from the stabilization fund for any agricultural commodity (1) the payments required by marketing or nonpremium insurance agreements in respect of the commodity, (2) the salaries and expenses of such expert* as the board determines shall be payable from such fund, (3) repayments into the revolving fund of advances made from the revolving fund to the stabilization fund, together with interest on such amounts at the rate of 4 per cent per annum, nud (4) service charges payable for the collection of equalization fees.

"Insurance

"Sec. 11. (a) In order (hat a cooperative association handling any staple agricultural commodity may with reasonable security make payments to its members at the time of delivery of such commodity by the members, fairly reflecting the current market value of such agricultural commodity, the board is authorized to enter into an agreement, uix>n .such terms and conditions as it may prescribe, for the insurance of such cooperative association against price decline as hereinafter provided. Such insurance agreement may be entered into by the board only with respect to any such agricultural commodity which, in the judgment of the board, is regularly traded in upon an exchange in sufficient volume to establish a recognized basic price for the market grades of such commodity, and then only when such exchange lias accurate price records for the commodity covering a period of years of sufficient length, in the judgment of the board, to serve as a basis upon which to calculate the risks of the insurance.

"(b) Any such agreement for insurance against price decline shall provide for the insurance of the cooperative association for any twelve months' period commencing with the delivery season for the commodity against loss to such association or its members due to decline in the average market price for the commodity during the time of sale by the association from the average market price for the commodity during the time of delivery to the association. The measure of such decline, where a decline occurs, shall be the difference between the average market price weighted for the days and volume of delivery to the association by its members, and the average market price weighted for the days and volume of sales by the association. In computing such average market prices the board shall use the daily average cash prices paid for the basic grade of such commodity in the exchange designated in the agreement. Any such agreement shall cover only so much of the commodity delivered to the association as is produced by the members of the association aud as is reported by the association for coverage under the agreement.

"(c) Whenever in the judgment of the board the use of such insurance agreements in respect of any commodity will stabilize the market substantially in the interest- of the producers of the commodity whether or not members of a cooperative association dealing in the commodity, then the board, during the continuance of any marketing period for the commodity as provided in section 8, may enter into nonpremium, or if the board deems it advisable, premium insurance agreements with cooperative associations dealing in the commodity. Whenever in the judgment of the board the use of such insurance agreements will not so stabilize the market, then the board may enter into premium insurance agreements only with the cooperative associations.

"(d) Payments required under nonpremium insurance agreements in respect of any commodity shall be made out of the stabilization fund for the commodity. Payments under premium insurance agreements in respect of any commodity shall I* made out of the premium insurance fund for the commodity to be established by the board under such regulations as it may prescribe.

"(e) For insurance under a premium insurance agreement the cooperative association shall pay a premium, to be determined by the board prior to the making of the insurance agreement, upon each unit of the commodity reported by the association for coverage under the insurance agreement. Such premium shall be calculated with due regard to the past price records in established markets for the commodity. The premiums applicable to the commodity in the successive twelve months' periods shall be adjusted with due regard to the experience of the board under preceding insurance agreements. There shall be deposited in the premium insurance fund for any commodity the premiums paid by cooperative associations under premium insurance agreements in respect of the commodity, and advances from the revolving fund in such amounts as the board deems necessary for the operation of the fund. There shall be disbursed from tlie premium insurance fund for any commodity (1) the payments required by any premium insurance agreement in respect of Mip commodity, and (2) repayments into the revolving fund of advances made from the revolving fund to such premium insurance fund, together with interest on such advances at the rate of J per cent Ik.t annum.

"REVOLVING Kt'ND

"Skc. 12 (a). There is hereby authorized to be appropriated, out of any money in the Treasury not otherwise appropriated, the sum of $400,000,00(1: Provided; That at least $200,000,000 of such sum shall be made available by the board solely for use in making advances to the stabilization funds for agricultural couiaiodities in respect of which marketing periods are commenced; and in the allocation <>f such amount among the stabilization funds of the several commodities, the board shall take into consideration the values of the respective commodities.

"(b) All moneys appropriated in pursuance of the authorization made by this section shall be administered by the board and used as a revolving fund in accordance with the provisions of this Act. The Secretary of the Treasury shall deposit in the revolving fund such portions of the amounts appropriated therefor as the board from time to time deems necessary.

"EXAMINATION'S OK BOOKS AND ACCOPNTK OP HOAHD

"Sec. 13. Expenditures by the board from the stabilization or premium insurance funds shall be made by the authorized officers or agents of the board upon receipt of itemized vouchers therefor, approved by such officers as the hoard may designate. All other expenditures by the board, including expenditures for loans and advances from the revolving fund, shall be allowed and paid upon the presentation of itemized vouchers therefor, ai>proved by the chairman of the board. Vouchers so made for expenditures from the revolving fund or from any stabilization or premium insurance fund shall be final and conclusive upon all officers of the Government; except that all financial transactions of tlie board (including the payments required by any marketing or insurance agreement) shall, subject to the above limitations, be examined by the General Accounting Office, at stich times and in such manner as the Comptroller General of the I'nited States may by regulation prescribe. Such examination in respect of expenditures from the revolving fund or from any stabilization or premium insurance fund shall be for the sole pnqiose of making a report to the Congress and to the board of expenditures and agreements in violation of law. together with such recommendations as the. Comptroller General deems advisable concerning the receipts, disbursements, and application of the funds administered by the board.

"COOPERATION WITH EXECUTIVE DEPARTMENTS

"Sbc. 14. (a) It shall be the duty of any governmental establishment in the executive branch of the Government, upon request by the board, or upon Executive order, to cooperate with and render assistance to the board in carrying out any of the provisions of this act and the regulations of the board. The hoard shall, in cooperation with any such governmental establishment, avail itself of the services and facilities of such governmental establishment in order to avoid preventable expense or duplication of effort.

"(b) Upon request by the board the President, by Executive order, (1) may transfer any officer or employee from any department or independent establishment in the executive branch of the Government, irrespective of his length of service in such department or independent establishment, to the service of the. board, and (2) may direct any governmental establishment to fnrnlsh the board with such information and data pertaining to the functions of the board as may be contained in the recordsof the governmental establishment; except that the President shall not direct that the board be furnished with any information or data supplied by any person in confidence to any governmental establishment, In pursuance of any provision of law or of any agreement with the governmental establishment.

"(c) The board may cooperate with any State or Territory, or department, agency, or political subdivision thereof, or with any person.

"GENERAL DEFINITION'S

"SRC. 15. (a) As used in this act—

"(1) The term 'person' means individual, partnership, corI*>ratic>n, or association.

"(2) The term 'United States.' when used in a geographical sense, means continental United States and the Territory of Hawaii.

"(3) The term 'cooperative association' means an association of persons engaged in the production of agricultural products, as farmers, planters, ranchers, dairymen, or nut or fruit growers, organized to carry out any purpose specified in section 1 ')f the act entitled 'An act to authorize association of producers of agricultural products,' approved February 18, 1922, if such association is qualified under such act.

"(b) The provisions of sections 8, 9, and 10 shall not apply to perishable fruits and vegetables.

"(c) Whenever any agricultural commodity has regional or market classifications or types which in the judgment of the board are so different from each other in use or marketing methods as to require their treatment as separate commodities under this act, the board may determine upon and designate one or more such classifications or types for such treatment.

"ADMINISTRATIVE APPROPRIATION

"Sec. 16. For expenses in the administration of the functions vested in the hoard by this act, there is hereby authorized to be appropriated, out of any money in the Treasury not otherwise appropriated, the sum of $500,000, to bo available to the board for such expenses (including salaries and expenses of the members, officers, and employees of the board and the per diem compensation and expenses of members of the commodity advisory councils) incurred prior to July 1, 1929.

"SEPARABILITY OF PROVISIONS

"Sec. 17. If any provision of this act is declared unconstitutional or the applicability thereof to any person, circumstance, commodity, or class of transactions in respect of any commodity, is held invalid, the validity of the remainder of the act and the applicability of such provision to other persons, circumstances, commodities, and classes of transactions shall not be affected thereby.

"COOPERATIVE ASSOCIATION'S ACT

"sec. 18. (a) Nothing in this act is intended or shall be construed to repeal or modify any provision of the act entitled 'An act to authorize association of producers of agricultural products,' approved February 18, 1922.

"PENALTIES

"SEC. 19. (a) The provisions of sections 123 and 124 of the Penal Code, approved March 4, 1909, as amended, shall apply to any member, officer, or employee of the board; and. in addition, it shall be held a violation of section 123 of such code if any member, officer, or employee of the board at any time speculates, directly or indirectly, in any agricultural commodity.

"(b)" It shall I* unlawful (1) for any cooperative association, or corporation created and controlled by one or more cooperative associations or other agency if such agency is acting for or on behalf of the board under any marketing agreement, or (2) for any director, officer, or employee of any such association, corporation, or agency, to which information has been imparted in confidence by the board, to disclose such information in violation of any regulation of the board. Any such association, corporation, or agency, or director, officer, or employee thereof, violating any provision of this subdivision, shall be fined not more than $10,000 or imprisoned not more than 10 years, or both.

"SHOBT TITLB

"Sec. 20. This act may be cited as the 'surplus control act.'"

And the House agree to the same.

G. N. Haugkn,
Fred S. Purxell,
T. S. Williams,
D. H. Kincheloe.

Managers on the part of the House.
Chas. L. Mcnary,
Jos. E. Ransdell,
F. R. Gooniwo,
Art-hub Capper,
Managers on the part of the Senate.

STATEMENT

The managers on the part of the House at the conference on the disagreeing votes of the two Houses on the bill (S. 3555) to establish a Federal farm board to aid in the orderly marketing and in the control and disposition of the surplus of agricultural commodities in interstate and foreign commerce, submit the following statement in explanation of the effect of the action agreed upon by the conferees and recommended in the accompanying conference report:

The House amendment struck out all of the Senate bill after the enacting clause. The Senate recedes from its disagreement to the amendment of the House, with an amendment which is a substitute for both the Senate bill and the House amendment. The essential differences between the Senate bill and the House amendment, and the nature of the corresponding provisions of the substitute agreed upon by the conferees, are set forth in the following discussion:

1. Qualifications of board memlx'rs: The Senate bill required that a member of the board must be either a producer of some one or more agricultural products, or interested in nnd truly representative of agriculture. The House amendment contained no such requiiement. The substitute adopts the provision in the Senate bill.

2. Adjustment of production: The Senate bill directed the board to advise proiUicers in the development of suitable programs of planting or breeding in order that the maximum benefits under the bill might be realized. It also authorized the board to refuse to commence a marketing period, or to terminate an existing marketing period on 12 months' notice, in case producers substantially disregarded the advice of the board us to a suitable program of planting or breeding, or in case of a substantial increase in planting or breeding over the preceding five-year average.

The House amendment contained the same provision for advice as to a suitable program of planting or breeding, but stated the purpose of such advice to lie in order that burdensome crop surpluses might be avoided or minimized. The House amendment also provided for advice to producers on all matters connected with the adjustment of production, and further authorized the board to refuse to make loans to cooperative associiitii/ns for the purchase of crop surpluses in case producers substantially disregarded the advice of the board or substantially increased the planting or breeding of any commodity above the average for the preceding five years.

The substitute retains the provision of the Senate bill and the House amendment for advice as to a suitable program of planting or breeding, adding thereto the House statement of the object sought; i. e., so that burdensome crop surpluses might be avoided or minimized. The House provision for advice on matters relating to the adjustment of production also is adopted in the substitute. The substitute further retains the provision authorizing refusal to make loans in the event of abnormally increased production that appeared in the House amendment, while the provision in the Senate bill authorizing the board under such conditions to refuse to make marketing agreements is 'omitted. The substitute stresses the influence which the board can exercise through advice and leadership in the development of a sound program of planting and breeding, and recognizes that in the case of marketing agreements under which the cost of organized handling of the surplus would be borne by all the producers through equalization fees, the equalization fees themselves would automatically reflect upon the producers the penalties of an abnormally increased surplus, thus making unnecessary the omitted Senate provision.

3. Organization of advisory councils: The Senate bill provided that whenever the board was organized or whenever it determined that any agricultural commodity might require stabilization through marketing agreements or whenever the cooperative associations or other organizations representative of producers of the commodity applied to the board, then the board should constitute an advisory council. It was further provided that the council should be a private agency of seven members elected annually by the cooperative associations or other farm organizations representative of the commodity.

The House amendment provided that an advisory council for an agricultural commodity should be created prior to the commencement of a marketing period for such commodity. Under the House amendment the advisory council was composed of seven members fairly representative of the producers of the commodity and selected by the board. In making its selections the board was restricted to nominees in lists submitted by (1) cooperative associations, (2) other organizations representing the producers of the commodity, (3) governors, and ,(4) heads of agricultural departments in States where the commodity is produced.

Tlie substitute retains the provisions of the House bill with amendments making It clear that the advisory councils are governmental and not private agencies and that the cooperative associations, other organizations, governors, and heads of agricultural departments need not submit a joint list of nominees but may submit separate lists. Only cooperative associations, other organizations, governors, and heads of agricultural departments of States that during the preceding five crop years, according to the estimates of the United States Department of Agriculture, produced an average of 3 per cent or more of the average annual total domestic productions of the commodity, are, under the substitute, entitled to submit such Jists. This restriction confines the submission of lists to those Stales which are the principal producers of the commodity.

Under the substitute, members of the advisory council are paid a per diem compensation from Treasury appropriations, uml the councils are governmental nnd not private agencies and exercise no executive powers or functions in connection with the enforcement of the law, but merely, as hereinafter set forth, act as agents of the Congress, in conjunction with the board, to ascertain the existence of the contingencies of fact upon which marketing periods are to commence or terminate and upon which estimates for equalization fees nre to be based.

4. Concurrent action of advisory councils: The Senate bill

contained several provisions requiring the approval or concurrence of the advisory council for a particular commodity before any action of the board with regard to that commodity would be effective. Thus, the Senate bill provided that the advisory council must concur in the findings of the board before a marketing period could be commenced or terminated, and must concur in the estimate upon which the equalization fee was based before the fee could be collected. Again, the Senate bill contained duplicate provisions requiring the concurrence of the advisory council in the findings of the board as to termination of the marketing period, the approval by the advisory council of any decision of the board relating to the commencement or termination of the marketing period, and the concurrence of the advisory council in the estimate upon which the equalization fee is baaed. Finally, the Senate bill provided that all actions of the board having exclusive application to an agricultural commodity were subject to the approval of the advisory council. This last provision would apparently cover not only commencement and termination of marketing periods and collection of equalization fees but also the making of individual loans or individual insurance contracts, the payments of losses, costs, and charges upon marketing agreements, the obtaining of advances from the revolving fund for use of the stabilization funds or insurance funds, the repayment of such advances, the appointment of experts, and the making of regulations with regard to particular commodities, and a great number of minor matters.

The House amendment in but a single provision set forth that a marketing period could not be commenced or terminated, and that an equalization fee could not be collected unless the advisory council determined that the findings of the board iu connection with the commencement or termination of the marketing period or the estimate of the board in connection with the determination of the amount of the equalization fee were supported by the evidence and facts considered by the board, and that substantially all the material facts and evidence available were considered by the board.

The House amendment thus vested the advisory council with power, to be exercised concurrently with the power of the board, to examine the facts upon which the board's decision to commence or terminate a marketing period is based, or to approve the estimates which form the basis for determining the amount of equalization fees. Substantially the same delegation of power as to findings of fact is made to both governmental agencies, and their joint agreement is required as to the presence of certain prescribed conditions before part of the legislative power exercised in the bill becomes effective. The procedure by which the advisory council reaches its determination in these matters is set forth in the House amendment in some detail. After the Iward makes its determination as to the particular findings or estimate, it is required to submit a statement thereof to the appropriate advisory council. The advisory council must act within 15 days after receiving such statement. The advisory council iu its determination is confined to the record built up by the board as a basis for its finding or estimate and can not act arbitrarily or capriciously. It can not reach a determination contrary to that of the board unless it finds that the board's determination is not supported by the evidence and facts in the board's record. An exception is made in the event that the advisory council determines that the board has failed to consider substantially all the material facts and evidence available; in other words, that its record was incomplete in substantial particulars and lacked material facts and evidence. In that event the determination of the advisory council would fail to accord with the determination of the board, and the board would be notified in what respect such record was lacking, and would then have to reach a new determination upon the basis of a completed record.

The House amendment sets forth a clearly intelligible principle to which the advisory councils must conform and a clearly intelligible procedure through which they must act—all in such detail as to avoid any possibility of an improper delegation of legislative power to the advisory councils. The advisory councils act in conjunction with the board as the agents of Congress to ascertain and declare the existence of the contingencies upon which its expressed will is lo take effect.

The substitute retains the House provisions in lieu of the Senate provisions.

5. Loans to cooperative associations: The Senate bill provided for loans only to cooperative associations, in an aggregate amount not to exceed $230,000,000, for the following purposes: (a) To assist cooperative associations in controlling the surplus of any agricultural commodity; (b) to assist cooperative associations in acquiring facilities for preparing, handling, storing, or processing agricultural commodities; and (c) to provide cooperative associations with funds to be. used as capital for agricultural credit corporations. Loans for the purposes here set forth under (b) and (c) were limited in the aggregate to $25.000.000.

The House amendment authorized loans not only to cooperative associations but also to corporations created and controlled by them. The aggregate amount of all loans was limited in the House amendment to $400,000.000. The Ilouse amendment authorized such loans not only for- tlie purposes specified in the Senate bill but for the following additional purposes: (a) To provide cooperative associations or corporations created and controlled by them with working capital, and (b) to furnish nidi associations or corporations with funds for necessary expenditures in consolidating, federating, or extending their membeiship. Under the House amendment loans for the latter purpose were limited in the aggregate to $2,000,000.

The House amendment specified that loans must be on such terms as would afford adequate assurance of repayment and carry out the policy declared in section 1. It further specified that loans for purposes other than to assist in controlling surplus?, might be secured by members' marketing contracts, and i: •• ii'i within 20 years by means of a charge deducted from deliveries under members' marketing contracts.

The House amendment also sets forth in detail the conditions ti> which a corporation created and controlled by cooperative associations must conform in order to be eligible for loans. Its by-laws were required to be satisfactory to the board and to insure continued control by cooperative associations. Its records and accounts were required to be kept as prescribed by the board. The board was authorized to investigate its financinl condition and business methods, and there were provisions for reserve funds and patronage dividends.

The substitute contains the House provision for loans to corporations created and controlled by cooperative associations, as well as to cooperative associations themselves, but omits the detailed statement of conditions to which such corporations must conform in order to be eligible for loans. These detailed pruviMoiis are not included in the substitute for the reason that the board is given the general power to prescribe terms and conditions under which loans are to be made, and thus has abundant authority to require satisfactory, by-laws, satisfactory proof of cooperative control, and accounting and business methods acceptable to the board, as well as to reserve the right to examine the financial condition and business methods of any borrowing corporation if it should U't-ojue necessary.

The aggregate limit on all loans is fixed in the substitute in conformity with the two Senate provisions which made .$200,UOU.OOU of the revolving fund available for stabilization funds ami limited loans in the aggregate to $250,000,000, except that in the substitute what appeiirs to be an inconsistency in the amounts of the two Senate allotments totaling $450,000,000 out of a revolving fund of $400.000,000. is avoided by the fixing of the aggregate amount of all loans at .$200,000.000.

The substitute incorporates also the authorization of loans fi.r working capital, and to assist in consolidating or extending the membership of cooperative associations or corporations created by them, except that the limit on loans for the latter purpose is fixed at $1,000,000 instead of $2.000,000 as in the House amendment.

The provision in the Senate bill for the amortized repayment of loans is adopted in the substitute instead of the House provision, thus avoiding any implication that such loans were intended primarily for cooperative associations having members' marketing contracts. The substitute also adopts the language Hint was used in the House amendment as to the terms and conditions on which loans might be made, requiring adequate assurance of repayment, and conformity to the policy declared in section 1, in the case of each loan. The substitute places the same limit on the aggregate amount of loans (other than loans to assist in controlling surpluses) at $2:5.000.000. which was provided in both the Senate bill and the Ilouse amendment.

6. Investigation by board: The House amendment provided that Hie board, upon request by any leading cooperative association or upon its own motion, might Investigate with respect to any agricultural commodity and make certain determinations of fact. These determinations were roughly whether a surplus 'if tin commodity exists or threatens to exist, whether the existence or threatened existence of &uch surplus depresses or may depress the price of the commodity below the actual average cost of production for the preceding live years, and whether the commodity and its products are adaptable to storage and future disposal. The Senate bill contained no such provision. The substitute omits it for the reason that substantially all the power conferred by it on the board is included in the general powers vested in the board, or in the power of the board to investigations prior to commencement of marketing pe

riods. The provision is. therefore, unnecessary, particularly when the exercise of the power it confers is unrelated, as a condition precedent to any of the major activities of the board.

7. Definition of surplus: In connection with the loan provisions the Senate bill provided for a finding that there was or might be during the ensuing year a domestic, regional or national, seasonal or year's total surplus, with respect to the commodity.

The House amendment for the purpose of clarification only described the surplus as a seasonal or year's total surplus, produced in the United States and either local or national in extent. The House bill thus emphasizes that while the loan provisions deal only with surpluses of domestic production, on the other hand it is immaterial whether the particular surplus with respect to which the loans for controlling surpluses ar« made, is nation-wide and exists wherever the commodity is produced or exists merely as to particular regions comparatively local in character. The House amendment also emphasiz-s that the loan provisions relate to surplus irrespective of whether the surplus is arrived at on the basis of the total production for the year or whether, in the event that there is no year's total surplus, that nevertheless there is during certain seasons of production a temporary seasonal surplus.

The substitute as agreed to by the conferees retains the provisions of the House amendment.

Similar descriptions of surplus were found in both the Senate bill and the House amendment in connection with the marketing agreement provisions, except for the fact that there was no authorization to deal with local surpluses by means of marketing agreements. The House description of surplus was agaiu retaiiiKl in the substitute in connection with the findings precedent to marketing agreements.

8. Purchases subject to prevailing competitive conditions: The Senate bill provided that the price at which any part of a surplus was to be purchased or disposed of under marketing agreements should not be fixed in the agreements, but that all such purchases and disposals should be made subject to the prevailing competitive conditions of the markets in which they occurred.

The substitute follows the House amendment in omitting this provision in the belief that the provision was unnecessary. This follows, inasmuch as purchases would obviously have to be made in open markets, and that the board is not authorized to fix prices but that any adjustment in prices would result by reason of (lie price levels established by the tariff and other existing legislation and by reason of the orderly disposal of the surplus brought about because of its control in strong and friendly hands under the marketing; agreements which the board is empowed to make with cooperative associations or other agencies.

!). Fee on meat products on hand: The House amendment contained a provision, not found in the Senate bill, under which the board was directed, when any equalization fee was levied on cattle or swine, to impose and collect a similar fee of not less per pound than the fee imposed on cattle or swine, on their food products on hand and owned by any individual or corporation at the commencement of a marketing period for cattle or swine. Sales of such food products owned by retail dealers were excepted. The substitute contains a provision substantially like that of the House amendment, directing that when any equalization fee is collected with respect to cattle or swine, an equalization fee equivalent in amount, as nearly as may be, shall be collected on the first sale of any food product derived from cattle or swine, respectively, if the food product was on hand at the time of the commencement of the marketing period. The substitute likewise exempts from the equalization fee, sales of any food product owned in good faith by retail dealers at the time of the commencement of a marketing period.

10. Fees on importation: The House amendment contained a provision for the collection of an equalization fee during a marketing period in respect of any agricultural commodity on its importation into the United States, and for the collection of substantially tin equivalent fee on the importation of any food product of the commodity, with corresponding references throughout the amendment to the collection and use of such fees collected on importation. The Senate bill contained no such provisions. The substitute adopts the provisions of the House amendment.

11. Allocation of revolving fund: The Senate bill provided that at least $200.000,000 of the revolving fund should be available and used as a stabilization fund for financing the purchase, withholding, or disposal of agricultural commodities in the event that a marketing period should be declared for one or more of such commodities and that such fund should be allocated ratably to the stabilization funds for the several commodities according to the values of tlieir respective exportable sur

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