Full text of Agricultural Adjustment Act

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73d CONGRESS.

SESS. I .

CHS.

24, 25 .

MAY 3,12, 1933 .

certain judgment for $9,277,666 .17 entered in the office of the clerk
of the District Court of the United States for the Southern District
of California at Los Angeles on January 14, 1933, against the Pan
American Petroleum Company, a corporation, to release from claim
or lien under said judgment such part or portions of the property
and assets of the said Pan American Petroleum Company and the
Richfield Oil Company of California, in such manner and with such
reservations as shall seem to him proper and advisable, in consideration of payments to the United States to apply upon said
judgment, of not less than the sum of $5,000,000, and in connection
therewith to release any claims of the United States against purchasers of oil and petroleum products from the leases commonly
known as " E ", " I ", and " G " leases, or also known as Visalia
010042, 010043, and 010097 leases in naval petroleum reserve numbered 1, Kern County, California, and to consent, in the premises,
to the assignment of other oil and gas leases in said naval petroleum
reserve numbered 1, now part of the unmortgaged assets of Pan
American Petroleum Company, with the concurrence of the Secretary of the Navy and to the assignment of other oil and gas leases,
also part of the unmortgaged assets of Pan American Petroleum
Company, of the United States outside the said naval petroleum
reserve numbered 1, with the consent of the Secretary of the Interior,
said assignments to be authorized only to assignees otherwise duly
qualified under existing laws : Provided, That the authority herein
granted is permissive only, and shall not be construed as a declaration of approval by Congress of the compromise herein authorized
to be made, and that said authority shall not be exercised by the
Attorney General unless in his judgment said compromise shall
appear to him to be for the best interests of the United States .
Approved, May 3, 1933 .

31

Approval
plied .

o plaIIai~

not

im_

of authority

[CHAPTER 25 .1
AN ACT
To relieve the existing national economic emergency by increasing agricultural
purchasingspower, to raise revenue for extraordinary expenses incurred by
reason of ch eergency, to provide emergency relief with respect to agricultural indebtedness, to provide for the orderly liquidation of joint-stock
land banks, and for other purposes .

may 12,1933 .

[H,
u e o. 1
[Pub lic, No 0.j

Agricultural AdjustBe it enacted by the Senate and House o f Representatives o f the nip
United States of America in Congress assembled,
Post, pp . 199, 354 .

TITLE I-AGRICULTURAL ADJUSTMENT

A .RICULTUR tL
JUSTMENT
.

AD-

DECLARATION OF EMERGENCY

That the present acute economic emergency being in part the conse- Declaration of emer .
quence of a severe and increasing disparity between the prices of geIIcy .
agricultural and other commodities, which disparity has largely
destroyed the purchasing power of farmers for industrial products,
has broken down the orderly exchange of commodities, and has seriously impaired the agricultural assets supporting the national credit
structure, it is hereby declared that these conditions in the basic
industry of agriculture have affected transactions in agricultural
commodities with a national public interest, have burdened and
obstructed the normal currents of commerce in such commodities,
and render imperative the immediate enactment of title I of this Act.

73d CONGRESS . SESS. I. CH. 25 .

32
Declaration of policy .

Balanceand c nsumpduction
consumption to be established,
etc.

Base period, except
for tobacco

.

For tobacco .

Correcting
inequalities

present

Protecting consumors 'interest.

COTTON OPTION CONTRACTS .

Duties of designated
agencies .

MAY 12, 1933.

DECLARATION OF POLICY

SEo. 2. It is hereby declared to be the policy of Congress-

(1) To establish and maintain such balance between the production and consumption of agricultural commodities, and such marketing conditions therefor, as will reestablish prices to farmers at a
level that will give agricultural commodities a purchasing power
with respect to articles that farmers buy, equivalent to the purchasing power of agricultural commodities in the base period . The base
period in the case of all agricultural commodities except tobacco
shall be the prewar period, August 1909-July 1914. In the case of
tobacco, the base period shall be the postwar period, August 1919July 1929.
(2) To approach such equality of purchasing power by gradual
correction of the present inequalities therein at as rapid a rate as is
deemed feasible in view of the current consumptive demand in
domestic and foreign markets .
(3) To protect the consumers'7 interest by readjusting farm production at such level as will not increase the percentage of the
consumers' retail expenditures for agricultural commodities, or
products derived therefrom, which is returned to the farmer, above
the percentage which was returned to the farmer in the prewar
period, August 1909-July 1914 .
PART 1-COTTON OPTION CONTRACTS

SEC. - 3. The Federal Farm Board and all departments and other
agencies of the Government, not including the Federal intermediate
credit banks, are hereby directedCotton on hand to be
(a) To sell to the Secretary of Agriculture at such price as may
sold to Secretary of
Agriculture .
be agreed upon, not in excess of the market price, all cotton now
owned by them .
Acquiring full title
(b) To take such action and to make such settlements as are neceson which money has
been loaned, etc .
sary in order to acquire full legal title to all cotton on which money
has been loaned or advanced by any department or agency of the
United States, including futures contracts for cotton or which is
held as collateral for loans or advances and to make final settlement
of such loans and advances as follows
Method of settlements .
(1) In making such settlements with regard to cotton, including
operations to which such cotton is related, such cotton shall be taken
over by all such departments or agencies other than the Secretary
. equal
amount loaned
of Agriculture at a price or sum equal to the amounts directly or
indirectly loaned or advanced thereon and outstanding, including
senior loans.
loans by the Government department or agency and any loans senior
thereto, plus any sums required to adjust advances to growers to
90 per centum of the value of their cotton at the date of its delivery
Collateral.
in the first instance as collateral to the department or agency
Computation.
involved, such sums to be computed by subtracting the total amount
already advanced to growers on account of pools of which such
cotton was a part, from 90 per centum of the value of the cotton to
be taken over as of the time of such delivery as collateral, plus
unpaid accrued carrying charges and operating costs on such cotton,
less, however, any existing assets of the borrower derived from net
income, earnings, or profits arising from such cotton, and from
operations to which such cotton is related ; all as determined by the
Cotton held as col- department or agency making the settlement,
lateral for loans, etc .
(2) The Secretary of Agriculture shall make settlements with
respect to cotton held as collateral for loans or advances made by
him on such terms as in his judgment may be deemed advisable,

73d CONGRESS. SESS. I. CH. 25 .

MAY 12, 1933 .

33

of
and to carry out the provisions of this section, is authorized to lostIndemnification
receipts .
indemnify or furnish bonds to warehousemen for lost warehouse
receipts and to pay the premiums on such bonds .
of, o Secretary
When full legal title to the cotton referred to in (b) has been of ASale
gric
acquired, it shall be sold to the Secretary of Agriculture for the
purposes of this section, in the same manner as provided in (a) .
(c) The Secretary of Agriculture is hereby authorized to purchase Purchase authorized .
the cotton specified in paragraphs (a) and (b) .
Secretary may borSEC. 4. The Secretary of Agriculture shall have authority
to row,
using warehouse
receipts as collateral .
borrow money upon all cotton in his possession or control and Post, p . 1058 .
deposit as collateral for such loans the warehouse receipts for such
cotton.
Reconstruction
FiSEC. 5. The Reconstruction Finance Corporation is hereby author- nance Corporation.
Loans by, authorized and directed to advance money and to make loans to the Secre- .ized.
tary of Agriculture to acquire such cotton and to pay the classing
carrying, and merchandising costs thereon, in such amounts and
upon such terms as may be agreed upon by the Secretary and the
Reconstruction Finance Corporation, with such warehouse receipts
as collateral security : Provided, however, That in any instance Proviso.
Security other than
where it is impossible or impracticable for the Secretary to deliver warehouse receipts .
such warehouse receipts as collateral security for the advances and
loans herein provided to be made, the Reconstruction Finance
Corporation may accept in lieu of all or any part thereof such other
security as it may consider acceptable for the purposes aforesaid,
including an assignment or assignments of the equity and interest
of the Secretary in warehouse receipts pledged to secure other ObligationsofCorpo.
indebtedness . The amount of notes, bonds, debentures, and other ration
increased .
such obligations which the Reconstruction Finance Corporation is Vol. 47, p. 9.
authorized and empowered to issue and to have outstanding at any
one time under existing law is hereby increased by an amount
sufficient to carry out the provisions of this section .
Option contracts to
SEC . 6. (a) The Secretary of Agriculture is hereby authorized to sell cotton to producer
in
producenter into option contracts with the producers of cotton to sell to tion,""19330"'P
.
anyy such producer an amount of cotton to be agreed upon not in
excess of the amount of reduction in production of cotton by such
producer below the amount produced by him in the preceding crop Post, p . 601greement
year, in all cases where such producer agrees in writing to reduce to reduce production .
the amount of cotton produced by him in 1933, below his production
in the previous year, by not less than 30 per centum, without increase
in commercial fertilization per acre .
Nontransferable op(b) To any such producer so agreeing to reduce production the tion contracts .
Secretary of Agriculture shall deliver a nontransferable-option
contract agreeing to sell to said producer an amount, equivalent to
the amount of his agreed reduction, of the cotton in the possession
and control of the Secretary .
Producer's option to
at price paid by
(c) The producer is to have the option to buy said cotton at the buy,
Secretary.
average price paid by the Secretary for the cotton procured under
section 3, and is to have the right at any time up to January 1, 1034,
to exercise his option, upon proof that he has complied with his
contract and with all the rules and regulations of the Secretary of
Agriculture with respect thereto, by taking said cotton upon pay- Secretary may sell,
ment by him of his option price and all actual carrying charges on for producer's account .
such cotton ; or the Secretary may sell such cotton for the account of Net profits to inure
such producer, paying him the excess of the market price at the date to producer .
of sale over the average price above referred to after deducting all
actual and necessary carrying charges : Provided, That in no event Liability for lo,; .
shall the producer be held responsible or liable for financial loss
incurred in the holding of such cotton or on account of the carrying Use of land restricted.
charges therein : Provided further, That such agreement to curtail
86637 °-34-3

34

Undisposed cotton .
Similar contracts and
restrictions to be provided .

Provisions for selling,
by Secretary .
Post, p . 210 .
Provisos.
Total disposition by
March 1, 1936'
Additional option
contracts .

73d CONGRESS .

Protection, marketing, etc .
Advances, deduction
for inspection costs,
etc .

To enter into marketing agreements with
respect to any agricultural commodity, etc .
Not to be held as violating antitrust laws .

Proviso .

Duration of agreement .
Loans to parties entering agreement ; limitation .
Vol . 47, p. 6.

1933 .

PART 2-COMMODITY BENEFITS

General powers .

Storage of nonperishable commodities on
the farm, etc .

12,

cotton production shall contain a further provision that such cotton
producer shall not use the land taken out of cotton production for
the production for sale, directly or indirectly, of any other nationally
produced agricultural commodity or product .
(d) If any cotton held by the Secretary of Agriculture is not
disposed of under subsection (c), the Secretary is authorized to enter
into similar option contracts with respect to such cotton, conditioned
upon a like reduction of production in 1934, and permitting the
producer in each case to exercise his option at any time up to
January 1, 1935.
SEC. 7. The Secretary shall sell the cotton held by him at his
discretion, but subject to the foregoing provisions : Provided, That
he shall dispose of all cotton held by him by March 1, 1936 :
Provided further, That the Secretary shall have authority to enter
into additional option contracts for so much of such cotton as is not
necessary to comply with the provisions of section 6, in combination
with benefit payments as provided for in part 2 of this title .

Commodity benefits.

Secretary of Agriculture .
To reduce produetion of basic agricultural commodities .
Post, p . 676 .
Rental or benefit
payments .

SESS . I. CH. 25 . MAY

GENERAL POWERS
SEC . 8 . In order to effecuate 1 the declared policy, the Secretary
of Agriculture shall have power(1) To provide for reduction in the acreage or reduction in the
production for market, or both, of any basic agricultural commodity,
through agreements with producers or by other voluntary methods,
and to provide for rental or benefit payments in connection therewith
or upon that part of the production of any basic agricultural commodity required for domestic consumption, in such amounts as the
Secretary deems fair and reasonable, to be paid out of any moneys
available for such payments . Under regulations of the Secretary of
Agriculture requiring adequate facilities for the storage of any
non-perishable agricultural commodity on the farm, inspection and
measurement of any such commodity so stored, and the locking and
sealing thereof, and such other regulations as may be prescribed
by the Secretary of Agriculture for the protection of such commodity
and for the marketing thereof, a reasonable percentage of any benefit
payment may be advanced on any such commodity so stored . In any
such case, such deduction may be made from the amount of the
benefit payment as the Secretary of Agriculture determines will
reasonably compensate for the cost of inspection and sealing, but
no deduction may be made for interest .
(2) To enter into marketing agreements with processors, associations of producers, and others engaged in the handling, in the
current of interstate or foreign commerce of any agricultural commodity or product thereof, after due notice and opportunity for
hearing to interested parties. The making of any such agreement
shall not be held to be in violation of any of the antitrust laws of
the United States, and any such agreement shall be deemed to be
lawful : Provided, That no such agreement shall remain in force
after the termination of this Act . For the purpose of carrying out
any such agreement the parties thereto shall be eligible for loans
from the Reconstruction Finance Corporation under section 5 of the
Reconstruction Finance Corporation Act . Such loans shall not be
in excess of such amounts as may be authorized by the agreements .
1So in original.

73d CONGRESS . SESS . I . CH. 25 . MAY 12, 1933 .

35

To issue licenses, per(3) To issue licenses permitting processors, associations of pro- mitting
handling of
any
comducers, and others to engage in the handling, in the current of modagricultural
us or competing
interstate or foreign commerce, of any agricultural commodity or prod ct thereof.
product thereof, or any competing commodity or product thereof . Terms of issue .
Such licenses shall be subject to such terms and conditions, not in
conflict with existing Acts of Congress or regulations pursuant thereto, as may be necessary to eliminate unfair practices or charges that
prevent or tend to prevent the effectuation of the declared policy and
the restoration of normal economic conditions in the marketing of
Licenses may be sussuch commodities or products and the financing thereof . The Secre- pended
or revoked .
tary of Agriculture may suspend or revoke any such license, after due
notice and opportunity for hearing, for violations of the terms or
order ficonditions thereof . Any order of the Secretary suspending or nalSecretary's
.
revoking any such license shall be final if in accordance with law .
Any such person engaged in such handling without a license as Penalty for violation .
required by the Secretary under this section shall be subject to a fine
of not more than $1,000 for each day during which the violation
continues.
require licensee
(4) To require any licensee under this section to furnish such toTofurnish
reports and
keep system of acreports as to quantities of agricultural commodities or products to
counts .
thereof bought and sold and the prices thereof, and as to trade
practices and charges, and to keep such systems of accounts, as may
be necessary for the purpose of part 2 of this title .
Removal, on which
(5) No person engaged in the storage in a public warehouse of warehouse
receipt is
any basic agricultural commodity in the current of interstate or outstanding, unlawful .
foreign commerce, shall deliver any such commodity upon which
a warehouse receipt has been issued and is outstanding, without
prior surrender and cancellation of such warehouse receipt . Any Punishment for .
person violating any of the provisions of this subsection shall, upon
conviction, be punished by a fine of not more than $5,000, or by
of license
imprisonment for not more than two years, or both . The Secretary forRevocation
violation.
of Agriculture may revoke any license issued under subsection (3) of
this section, if he finds, after due notice and opportunity for hearing, Post, p . 672.
that the licensee has violated the provisions of this subsection .

PROCESSING TAX

Processing tax.

Levy of, to meet ecoSEC. 9. (a) To obtain revenue for extraordinary expenses incurred nomic
emergencies .
by reason of the national economic emergency, there shall be levied Post, p. 676 .
Rental, etc ., payprocessing taxes as hereinafter provided . When the Secretary of ments .
Agriculture determines that rental or benefit payments are to be
made with respect to any basic agricultural commodity, he shall
proclaim such determination, and a processing tax shall be in effect Effective date of tax .
with respect to such commodity from the beginning of the marketing
year therefor next following the date of such proclamation . The etc.Levy, assessment,
processing tax shall be levied, assessed, and collected upon the first
domestic processing of the commodity, whether of domestic production or imported, and shall be paid by the processor. The rate Rate.
of tax shall conform to the requirements of subsection (b) . Such
rate shall be determined by the Secretary of Agriculture as of the
date the tax first takes effect, and the rate so determined shall, at
such intervals as the Secretary finds necessary to effectuate the
declared policy, be adjusted by him to conform to such requirements .
The processing tax shall terminate at the end of the marketing year Termination.
current at the time the Secretary proclaims that rental or benefit
payments are to be discontinued with respect to such commodity .
The marketing year for each commodity shall be ascertained and

36
Proviso c
Manufacturers' sales
tax computed .
Vol . 47, p. 259 .

73d CONGRESS. SESS. I .

CH. 25. MAY 12, 1933 .

prescribed by regulations of the Secretary of Agriculture : Provided
That upon nyarticle upon which a anufacturers' sales tax is
levied under the authority of the Revenue Act of 1932 and which
manufacturers' sales tax is computed on the basis of weight, such
manufacturers' sales tax shall be computed on the basis of the weight
of said finished article less the weight of the processed cotton
contained therein on which a processing tax has been paid .
Rate to equal differ(b) The processing tax shall be at such rate as equals the difference between current
farm price and fair ence between the current average farm price for the commodity and
exchange value .
Factors to be con- the fair exchange value of the commodity ; except that if the Secree
sidered
taryhas reason to believe that the tax at such rate will cause such
Post. ,>. s 71.
reduction in the quantity of the commodity or products thereof
domestically consumed as to result in the accumulation of surplus
stocks of the commodity or products thereof or in the depression of
the farm price of the commodity, then he shall cause an appropriate
investigation to be made and afford due notice and opportunity for
To prevent accumuhearing to interested parties . If thereupon the Secretary finds that
lation of surplus and de
pression of farm price .
such result will occur, then the processing tax shall be at such rate
as will prevent such accumulation of surplus stocks and depression
aotein content of
of the farm price of the commodity . In computing the current
w er
average farm price in the case of wheat, premiums paid producers
for protein content shall not be taken into account .
Fair exchange value
(c) For the purposes of part 2 of this title, the fair exchange
defined .
value of a commodity shall be the price therefor that will give the
commodity the same purchasing power, with respect to articles
farmers buy, as such commodity had during the base period speciHow ascertained •
fied in section 2 ; and the current average farm price and the fair
exchange value shall be ascertained by the Secretary of Agriculture
from available statistics of the Department of Agriculture .
" Processing" de- (d) As used in part 2 of this title(1) In case of wheat, rice, and corn, the term " processing 11
fmed .
Post, pp, 528, 670 .
means the milling or other processing (except cleaning and drying)
of wheat, rice, or corn for market, including custom milling for toll
as well as commercial milling, but shall not include the grinding or
cracking thereof not in the form of flour for feed purposes only .
(2) In case of cotton, the term "processing" means the spinning, manufacturing, or other processing (except ginning) of cotton ; and the term " cotton " shall not include cotton linters .
(3) In case of tobacco, the term "processing" means the manufacturing or other processing (except drying or converting into
insecticides and fertilizers) of tobacco .
(4) In case of hogs, the term " processing " means the slaughter
Post, p . 1242 .
of hogs for market .
Post, pp 528, 675,
(5) In the case of any other commodity, the term "processing"
1242.
means any manufacturing or other processing involving a change
in the form of the commodity or its preparation for market, as
defined by regulations of the Secretary of Agriculture ; and in
prescribing such regulations the Secretary shall give due weight
to the customs of the industry .
Pyramiding tax, prof(e) When any processing tax, or increase or decrease therein,
iteering, etc .
Measures to prevent . takes effect in respect of a commodity the Secretary of Agriculture,
in order to prevent pyramiding of the processing tax and profiteering in the sale of the products derived from the commodity, shall
Information to be make public such information as he deems necessary regarding
published .
(1) the relationship between the processing tax and the price paid
to producers of the commodity, (2) the effect of the processing tax
upon prices to consumers of products of the commodity, (3) the
relationship, in previous periods, between prices paid to the producers of the commodity and prices to consumers of the products

73d CONGRESS . SESS . I.

CH. 25.

thereof, and (4) the situation in foreign countries relating to prices
paid to producers of the commodity and prices to consumers of the
products thereof .
MISCELLANEOUS

10. (a) The Secretary of Agriculture may appoint such
officers and employees, subject to the provisions of the Classification
Act of 1923 and Acts amendatory thereof, and such experts as are
necessary to execute the functions vested in him by this title ; and
the Secretary may make such appointments without regard to the
civil service laws or regulations : Provided, That no salary in excess
of $10,000 per annum shall be paid to any officer, employee, or expert
of the Agricultural Adjustment Administration, which the Secretary shall establish in the Department of Agriculture for the administration of the functions vested in him by this title. Title II of the
Act entitled "An Act to maintain the credit of the United States
Government ", approved March 20, 1933, to the extent that it provides for the impoundment of appropriations on account of reductions in compensation, shall not operate to require such impoundment
under appropriations contained in this Act .
(b) The Secretary of Agriculture is authorized to establish, for
the more effective administration of the functions vested in him by
this title, State and local committees, or associations of producers,
and to permit cooperative associations of producers, when in his
judgment they are qualified to do so, to act as agents of their members and patrons in connection with the distribution of rental or
benefit payments .
(c) The Secretary of Agriculture is authorized, with the approval
of the President, to make such regulations with the force and effect
of law as may be necessary to carry out the powers vested in him
by this title, including regulations establishing conversion factors
for any commodity and article processed therefrom to determine
the amount of tax imposed or refunds to be made with respect
thereto. Any violation of any regulation shall be subject to such
penalty, not in excess of $100, as may be provided therein .
(d) The Secretary of the Treasury is authorized to make such
regulations as may be necessary to carry out the powers vested in
him by this title .
(e) The action of any officer, employee, or agent in determining
the amount of and in making any rental or benefit payment shall
not be subject to review by any officer of the Government other
than the Secretary of Agriculture or Secretary of the Treasury .
(f) The provisions of this title shall be applicable to the United
States and its possessions, except the Philippine Islands, the Virgin
Islands, American Samoa, the Canal Zone, and the island of Guam .
(g) No person shall, while acting in any official capacity in the
administration of this title, speculate, directly or indirectly, in any
agricultural commodity or product thereof, to which this title applies, or in contracts relating thereto, or in the stock or membership
interests of any association or corporation engaged in handling,
processing, or disposing of any such commodity or product . Any
person violating this subsection shall upon conviction thereof be
fined not more than $10,000 or imprisoned not more than two years,
or both.
(h) For the efficient administration of the provisions of part 2
of this title, the provisions, including penalties, of sections 8, 9,
and 10 of the Federal Trade Commission Act, approved September
26, 1914, are made applicable to the jurisdiction, powers, and duties
of the Secretary in administering the provisions of this title and to
SEC .

37

MAY 12, 1933 .
Post, p . 675 .

Miscellaneous .

Officers

and employees.
Appointment, under
Classification Act .
Vol . 42, p . 1488 ; Vol.
45, p . 776; Vol . 46, p.
1003 .
U .S.C ., p . 65; Supp.
VI, p. 31 .
Appointments outside civil service .
Proviso .
Salary restriction .

"Economy Act" provisions not applicable.
Ante, p . 15 .

Cooperative produc.
ers associations may act
as distributing agents
of benefit payments .

Conversion factors for
any commodity, etc .,
may be established .
Determination of tax,
etc .

Penalty for violation .
Regulations authorized.

Determination of
amount of rental, ete .,
payment* review restrictions .

Provisions not applicable to designated
possessions of U .S .
Post. p . 675 .
Speculation in agricultural commodities .
Persons administering title forbidden .

Penalty for .

Power to secure information, etc .
Vol . 38, pp. 722, 723 .
U.S .C ., p . 358 .

73d CONGRESS. SESS . I .

38

Hearings.

Enforcement, etc., of
agreement .

CH . 25. MAY 12, 1933 .

any person subject to the provisions of this title, whether or not a
corporation . Hearings authorized or required under this title shall
be conducted by the Secretary of Agriculture or such officer or
employee of the Department as he may designate for the purpose .
The Secretary may report any violation of any agreement entered
into under part 2 of this title to the Attorney General of the United
States, who shall cause appropriate proceedings to enforce such
agreement to be commenced and prosecuted in the proper courts of
the United States without delay .
COMMODITIES

"Basic agricultural
commodity ."
Products included .
1184ost, pp . 528, 670,
Authority to exclude
any commodity .

SEC. 11. As used in this title, the term "basic agricultural commodity " means wheat, cotton, field corn, hogs, rice, tobacco, and milk
and its products, and any regional or market classification, type, or
grade thereof ; but the Secretary of Agriculture shall exclude from
the operation of the provisions of this title, during any period any
such commodity or classification, type, or grade thereof if he finds,
upon investigation at any time and after due notice and opportunity
for hearing to interested parties, that the conditions of production,
marketing, and consumption are such that during such period this
title can not be effectively administered to the end of effectuating
the declared policy with respect to such commodity or classification,
type, or grade thereof .
APPROPRIATION

Appropriation for administrative expenses,
etc.
Post, pp . 528, 605, 678.

Available until expended .
Supplemental funds
for expansion of markets, etc.

Administrative
penses.

ex-

Estimate of needs .

Advances .

Services, etc., in the
District of Columbia .

Transfer of
authorized .

funds

SEC . 12. (a) There is hereby appropriated, out of an money in
the Treasury not otherwise appropriated, the sum of 100,000,000
to be available to the Secretary of Agriculture for administrative
expenses under this title and for rental and benefit payments made
with respect to reduction in acreage or reduction in production for
market under part 2 of this title . Such sum shall remain available
until expended .
(b) In addition to the foregoing, the proceeds derived from all
taxes imposed under this title are hereby appropriated to be available to the Secretary of Agriculture for expansion of markets and
removal of surplus agricultural products and the following purposes
under part 2 of this title : Administrative expenses, rental and benefit payments, and refunds on taxes . The Secretary of Agriculture
and the Secretary of the Treasury shall jointly estimate from time
to time the amounts, in addition to any money available under subsection (a), currently required for such purposes ; and the Secretary
of the Treasury shall, out of any money in the Treasury not otherwise appropriated, advance to the Secretary of Agriculture the
amounts so estimated . The amount of any such advance shall be
deducted from such tax proceeds as shall subsequently become available under this subsection .
(c) The administrative expenses provided for under this section
shall include, among others, expenditures for personal services and
rent in the District of Columbia and elsewhere, for law books and
books of reference, for contract stenographic reporting services, and
for printing and paper in addition to allotments under the existing
law . The Secretary of Agriculture shall transfer to the Treasury
Department, and is authorized to transfer to other agencies, out of
funds available for administrative expenses under this title, such
sums as are required to pay administrative expenses incurred and
refunds made by such department or agencies in the administration
of this title .

73d CONGRESS . SESS . I.

CH. 25 . MAY 12, 1933.

39

TERMINATION OF ACT

13 . This title shall cease to be in effect whenever the President finds and proclai ms that the national economic emergency in
relation to agriculture has been ended ; and pending such time the
President shall by proclamation terminate with respect to any basic
agricultural commodity such provisions of this title as he finds are
not requisite to carrying out the declared policy with respect to such
commodity. The Secretary of Agriculture shall make such investigations and reports thereon to the President as may be necessary to
aid him in executing this section .
SEC .

Termination of Act .
Post, p . 677 .

Investigations, etc.,
by Secretary of Agriculture .

SEPARABILITY OF PROVISIONS
SEC. 14. If any provision of this title is declared unconstitutional,
or the applicability thereof to any person, circumstance, or commodity is held invalid the validity of the remainder of this title and the
applicability thereof to other persons, circumstances, or commodities
shall not be affected thereby .
SUPPLEMENTARY REVENu

PROVISIONS

Separability clause .

Supplementary reve.
nue provisions .

EXEMPTIONS AND COMPENSATING TAXES
Exempting eommodSEC . 15. (a) If the Secretary of Agriculture finds, upon investiga'ties
of l g value from
tion at any
y time and after due notice and opportunity for hearing to processin tax .
interested parties, that any class of products of any commodity is
of such low value compared with the quantity of the commodity Post, pp . 675, 1241 .
used for their manufacture that the imposition of the processing
tax would prevent in whole or in large part the use of the commodity in the manufacture of such products and thereby substantially
reduce consumption and increase the surplus of the commodity, then
the Secretary of Agriculture shall so certify to the Secretary of the
Treasury, and the Secretary of the Treasury shall abate or refund
any processing tax assessed or paid after the date of such certification with respect to such amount of the commodity as is used in the
manufacture of such products .
(b) No tax shall be required to be paid on the processing of any No tax on processing
commodity by or for the producer thereof for consumption by his bopumptcers for home
own family, employees, or household ; and the Secretary of Agriculture is authorized, by regulations, to exempt from the _Payment of
the processing tax the processing of commodities by or r the producer thereof for sale by him where, in the judgment of the Secretary, the imposition of a processing tax with respect thereto is
unnecessary to effectuate the declared policy .
Tax refund on prod(c) Any person delivering any product to any organization for ucts
for charitable dis.
charitable distribution or use shall, if such product or the com- tribution .
Post, p . 973 .
modity from which processed, is under this title subject to tax,
be entitled to a refund of the amount of any tax paid under this
title with respect to such product so delivered .
to ascertain
(d) The Secretary of Agriculture shall ascertain from time to andSecretary
proclaim where tax
time whether the payment of the processing tax upon any basic causes disadvantages
agricultural commodity is causing or will cause to the processors in competition .
thereof disadvantages in competition from competing commodities
by reason of excessive shifts in consumption between such commodities or products thereof . If the Secretary of Agriculture finds, after
investigation and due notice and opportunity for hearing to interested parties, that such disadvantages in competition exist, or will
exist, he shall proclaim such finding . The Secretary shall specify it9ad e copemmg
in this proclamation the competing commodity and the compensating tax rate to be specified .
rate of tax on the processing thereof necessary to prevent such

40
Rate to be altered
accordingly .

Limitation .

Equalizing tax imposed on imports .
Post, p . 676.

Proviso .
Taxes
on articles
from U .S . possessions
not included herein .

To be expended for
benefit of agriculture .

Post, p. 676

73d CONGRESS . SESS . I . CH. 25 . MAY 12, 1933 .
disadvantages in competition . Thereafter there shall be levied,
assessed, and collected upon the first domestic processing of such
competing commodity a tax, to be paid by the processor, at the rate
specified, until such rate is altered pursuant to a further finding
under this section, or the tax or rate thereof on the basic agricultural
commodity is altered or terminated . In no case shall the tax imposed
upon such competing commodity exceed that imposed per equivalent
unit, as determined by the Secretary, upon the basic agricultural
commodity.
(e) During any period for which a processing tax is in effect with
respect to any commodity there shall be levied, assessed, collected,
and paid upon any article processed or manufactured wholly or in
chief value from such commodity and imported into the United
States or any possession thereof to which this title applies, from
any foreign country or from any possession of the United States
to which this title does not apply, a compensating tax equal to the
amount of the processing tax in effect with respect to domestic
processing at the time of importation : Provided, That all taxes
collected under this subsection upon articles coming from the possessions of the United States to which this title does not apply shall
not be covered into the general fund of the Treasury of the United
States but shall be held as a separate fund and paid into the Treasury
of the said possessions, respectively, to be used and expended by the
governments thereof for the benefit of agriculture . Such tax shall
be paid prior to the release of the article from customs custody or
control .
FLOOR STOCKS

Floor stocks .
Tax adjustments.

Levy, etc., of tax on
date processing
tax
takes effect.
Post, p . 676 .

Corresponding
refund, etc ., on termination of tax.

Stocks in retail trade
not affected .
Exceptions .

Refund,
etc ., not
applicable .
Post, pp. 678, 1241 .

SEC. 16 . (a) Upon the sale or other disposition of any article
processed wholly or in chief value from any commodity with respect
to which a processing tax is to be levied, that on the date the tax
first takes effect or wholly terminates with respect to the commodity,
is held for sale or other disposition (including articles in transit)
by any person, there shall be made a tax adjustment as follows
(1) Whenever the processing tax first takes effect, there shall be
levied, assessed, and collected a tax to be paid by such person equivalent to the amount of the processing tax which would be payable
with respect to the commodity from which processed if the processing
had occurred on such date .
(2) Whenever the processing tax is wholly terminated, there shall
be refunded to such person a sum (or if it has not been paid, the
tax shall be abated) in an amount equivalent to the processing tax
with respect to the commodity from which processed .
(b) The tax imposed by subsection (a) shall not apply to the
retail stocks of persons engaged in retail trade, held at the date the
processing tax first takes effect ; but such retail stocks shall not
be deemed to include stocks held in a warehouse on such date, or
such portion of other stocks held on such date as are not sold or
otherwise disposed of within thirty days thereafter . The tax refund
or abatement provided in subsection (a) shall not apply to the retail
stocks of persons engaged in retail trade, held on the date the
processing tax is wholly terminated.
EXPORTATIONS

Export refund .
Post, p . 676 .

SEC. 17. (a) Upon the exportation to any foreign country (including the Philippine Islands, the Virgin Islands, American Samoa,
and the island of Guam) of any product with respect to which a tax
has been paid under this title, or of any product processed wholly
or in chief value from a commodity with respect to which a tax

73d CONGRESS . SESS . I . CH. 25. MAY 12, 1933 .
has been paid under this title the exporter thereof shall be entitled
at the time of exportation to a refund of the amount of such tax .
(b) Upon the giving of bond satisfactory to the Secretary of the
Treasury for the faithful observance of the provisions of this title
requiring the payment of taxes, any person shall be entitled, without
payment of the tax, to process for such exportation any commodity
with respect to which a tax is imposed by this title, or to hold for
such exportation any article processed wholly or in chief value
therefrom.

41

Processing for exportation .
Tax free,under bond .
Post, pp . 676, 678 .

EXISTING CONTRACTS

Existing contracts.

SEC. 18. (a) If (1) any processor, jobber, or wholesaler has, prior
to the date a tax with respect to any commodity is first imposed
under this title, made a bona fide contract of sale for delivery on or
after such date, of any article processed wholly or in chief value from
such commodity, and if (2) such contract does not permit the
addition to the amount to be paid thereunder of the whole of such
tax then (unless the contract prohibits such addition) the vendee
shall pay so much of the tax as is not permitted to be added to the
contract price.
(b) Taxes payable by the vendee shall be paid to the vendor at
the time the sale is consummated and shall be collected and paid to
the United States by the vendor in the same manner as other taxes
under this title. In case of failure or refusal by the vendee to pay
such taxes to the vendor, the vendor shall report the facts to the
Commissioner of Internal Revenue who shall cause collections of
such taxes to be made from the vendee .

Prior contracts for
delivery after effective
date.

Payment by vendee.

Collection and payment by vendor.

Report of failure .

COLLECTION OF TAXES
SEC . 19 . (a) The taxes provided in this title shall be collected by
the Bureau of Internal Revenue under the direction of the Secretary
of the Treasury. Such taxes shall be paid into the Treasury of the
United States.
(b) All provisions of law, including penalties, applicable with
respect to the taxes imposed by section 600 of the Revenue Act of
1926, and the provisions of section 626 of the Revenue Act of 1932,
shall, in so far as applicable and not inconsistent with the provisions
of this title, be applicable in respect of taxes imposed by this title
Provided, That the Secretary of the Treasury is authorized to permit
postponement, for a period not exceeding ninety days, of the
payment of taxes covered by any return under this title.
(c) In order that the payment of taxes under this title may not
impose any immediate undue financial burden upon processors or
distributors, any processor or distributor subject to such taxes shall
be eligible for loans from the Reconstruction Finance Corporation
under section 5 of the Reconstruction Finance Corporation Act .

TITLE II-AGRICULTURAL CREDITS

Collection of taxes .

Provisionsgoverning
collections .
Vol. 44, p . 93 ; Vol . 47,
p . 269 .

Proviso .
Postponements.
Post, p . 1242.
Loans to processors.
Post, p. 677 .
Vol . 47, p . 6 .

AGRICULTURAL CREDITS .

PART 1-AMENDMENTS TO FEDERAL FARM LOAN ACT
ISSUANCE OF BONDS BY LAND BANKS
SECTION 21 . Section 32 of the Federal Farm Loan Act, as amended
(U .S.C., title 12, sec . 991), is amended by adding at the end thereof
the following new paragraph
" Until such time as the Farm Loan Commissioner determines that
Federal farm-loan bonds (other than those issued under this paragraph) are readily salable in the open market at a yield not in excess
of 4 per centum per annum, but in no case more than two years after

Emergency Farm
Mortgage Act of 1933 .
Federal Farm Loan
Act amendments.
Vol . 39, p . 384; Vol.
42, p . 105 .
U .S .C ., p . 314 .
Federal land banks
may issue farm loan
bonds.
Post, p . 346 .

73d CONGRESS . SESS . I. CH. 25 . MAY 12,1933 .

42
For making new
loans .
Purchasing outstanding farm mortgages .
Vol . 39, p . 372; U .S .C .
p . 306.
Maximum issue; denominations, etc .
Interest guaranteed .

Payment by Secretary if issuing bank
unable.
Appropriation authorized .
To become obligation
against such bank .

Use, for refinancing
outstanding loans .

Final issue .
Borrower may tender interest-guaranteed
bonds in payment .

Acceptance at par
authorized .

Farm mortgages .
Vol . 39, p .
amended .
U .S .C ., p . 306 .
Post, p . 347.

this paragraph takes effect, Federal land banks may issue farm-loan
bonds as authorized under this Act, for the purpose of making new
loans, or for purchasing mortgages or exchanging bonds for mortgages as provided in paragraph ' Second' of section 13 of this Act .
The aggregate amount of the bonds issued under this paragraph
shall not exceed $2,000,000,000, and such bonds shall be issued in such
denominations as the Farm Loan Commissioner shall prescribe, shall
bear interest at a rate not in excess of 4 per centum per annum, and
shall be fully and unconditionally guaranteed as to interest by the
United States, and such guaranty shall be expressed on the face
thereof. In the event that it shall appear to the Farm Loan Commissioner that the issuing bank or banks will be unable to pay upon
demand, when due, the interest on any such bonds, the Secretary of
the Treasury shall, upon the request of the Commissioner, pay the
amount thereof, which is hereby authorized to be appropriated out
of any money in the Treasury not otherwise appropriated. Upon
the payment of such interest by the Secretary of the Treasury the
amount so paid shall become an obligation to the United States of
the issuing bank or banks and shall bear interest at the same rate
as that borne by the bonds upon which the interest has been so paid .
After the expiration of one year from the date this paragraph takes
effect, if in the opinion of the Farm Loan Commissioner any part of
the proceeds of the bonds authorized to be issued under this paragraph is not required for the purpose of making new loans or for
purchasing mortgages or exchanging bonds for mortgages as herein
provided, such bonds may be issued within the maximum limit herein
specified for the purpose of refinancing any outstanding issues of
Federal farm-loan bonds ; but no such bonds shall be issued after
two years from the date this paragraph takes effect for the purpose
of such refinancing. Any borrower who obtains a loan from a
Federal land bank after the date this paragraph takes effect may, at
any time after the expiration of five years from the date such loan
was made, tender to such bank on any regular installment date, bonds
issued under this paragraph in an amount not to exceed the unpaid
principal of his loan, and the bonds so tendered shall be accepted
by the bank at par in payment of any part of such unpaid principal."
PURCHASE, REDUCTION, AND REFINANCING OF FARM MORTGAGES

372,

Purchase, reduction,
refinancing, etc .

Limitation on price .

Proviso .
Mortgagor's rights .
Vol . 39, pp . 365, 367;
U .S .C ., pp. 302-304.

SEC. 22. Paragraph " Second " of section 13 of the Federal Farm
Loan Act, as amended, is amended by adding at the end thereof the
following new sentence
" In order to reduce and/or refinance farm mortgages, to invest
such funds as may be in its possession in the purchase of first
mortgages on farm lands situated within the Federal land-bank
district within which it is organized or for which it is acting, or to
exchange farm-loan bonds for any duly recorded first mortgages on
farm lands executed prior to the date this paragraph, as amended,
takes effect, at a price which shall not exceed in each individual
case the amount of the unpaid principal of the mortgage on the date
of such purchase or exchange, or 50 per centum of the normal value of
the land mortgaged and 20 per centum of the value of the permanent
insured improvements thereon as determined upon an appraisal
made pursuant to this Act, whichever is the smaller : Provided, That
any mortgagor whose mortgage is acquired by a Federal land bank
under this paragraph shall be entitled to have his farm-mortgage
indebtedness refinanced in accordance with the provisions of sections
7 and 8 of this Act on the basis of the amount paid by the bank for
his mortgage ."

73d CONGRESS . SESS. I . CH. 25 . MAY 12, 1933.

43

EXTENSION OF LOANS
SEC . 23 . Paragraph "Tenth " of section 13 of the Federal Farm vx nsi p. 14.e ~
Loan Act, as amended (U .S.C., title 12, sec. 781), is amended by p uns .me p . vi,
adding at the end thereof the following : The terms of any such Term not to exceed
capacity to
extension shall be such as will not defer the collection of any borrower's
meet .
obligation due by any borrower which, after investigation by the Post, p. 1060 .
bank of the situation of such borrower, is shown to be within his
capacity to meet . In the case of any such extension made prior to
the expiration of five years from the date this paragraph as amended
takes effect, or in the case of any deferment of principal as provided
in paragraph `Twelfth' of section 12 of this Act, it shall be the
duty of the Secretary of the Treasury, on behalf of the United doreauId-in sburpl~
States, upon the request of the Federal land bank making the to cover extension, etc.
extension, and with the approval of the Farm Loan Commissioner,
to subscribe at such periods as the Commissioner shall determine,
to the paid-in surplus of such bank an amount equal to the amount
of all such extensions and deferments made by the bank during the
preceding period . Such subscriptions shall be subject to call, in t Sablscriptionssubject
whole or in part, by the bank with the approval of the Commissioner
upon thirty days' notice . To enable the Secretary of the Treasury Sum authorized for .
to make such subscriptions to the paid-in surplus of the Federal
land banks, there is hereby authorized to be appropriated the sum
of $50,000,000, to be immediately available and remain available
until expended . Upon payment to any Federal land bank of the
amount of any such subscription, such bank shall execute and deliver
a receipt therefor to the Secretary of the Treasury in form to be
prescribed by the Farm Loan Commissioner . The amount of any Repayment .
subscriptions to the paid-in surplus of any such bank may be repaid
in whole or in part at any time in the discretion of the bank and
with the approval of the Farm Loan Commissioner, and the Commissioner may at any time require such subscriptions to be repaid
in whole or in part if in his opinion the bank has resources available
therefor."

u

REDUCTION OF INTEREST ON LOANS AND DEFERMENT OF PRINCIPAL
SEC . 24. Section 12
(U.S.C., title 12, sees .

of the Federal Farm Loan Act, as amended
771-772), is amended by adding at the end
thereof
the
following
new
paragraph
«
Twelfth . Notwithstanding the provisions of paragraph' < Second,
the rate of interest on any loans on mortgage made through national
farm-loan associations or through agents as provided in section 15,
or purchased from joint-stock land banks, by any Federal land
bank, outstanding on the date this paragraph takes effect or made
through national farm-loan associations within two years after
such date, shall not exceed 41/2 per centum per annum for all interest
payable on installment dates occurring within a period of five years
commencing sixty days after the date this paragraph takes effect ;
and no payment of the principal portion of any installment of any
such loan shall be required during such five-year period if the borrower shall not be in default with respect to any other condition or
covenant of his mortgage . The foregoing provisions shall apply
to loans made by Federal land banks through branches, except that
the rate of interest on such loans for such five-year period shall
be 5 per centum in lieu of 41/2 per centum . The Secretary of the
Treasury shall pay each Federal land bank, as soon as practicable
after October 1, 1933, and after the end of each quarter thereafter,
such amount as the Farm Loan Commissioner certifies to the Secre-

Loans and deferment
of principal.
Vol . 39, p .
amended.
U .S .C . p.306.

372,

Interest rate on loans
by national farm-loan
associations r307 ced .

Payment of princi.
pal suspended if borrower not in default .

bankp loans
rate reduced .

; toland

to compensation
Appropriation ior .
Post, p. 279.

for

73d CONGRESS.

44

SESS. I.

CH. 25 . MAY 12, 1933.

tary of the Treasury is equal to the amount by which interest payments on mortgages held by such bank have been reduced, during
Less any savings the preceding quarter, by reason of this paragraph ; but in any case
effected.
in which the Farm Loan Commissioner finds that the amount of
interest payable by such bank during any quarter has been reduced
Post, p . 48 .
by reason of the refinancing of bonds under section 32 of this Act,
the amount of the reduction so found shall be deducted from the
Final payments.
amount payable to such bank under this paragraph . No payments
shall be made to a bank with respect to any period after June 30,
1938. There is authorized to be appropriated, out of any money
Appropriation au- in the Treasury not otherwise appropriated, the sum of $15,000,000
thorized.
Post, p . 279 .
for the purpose of enabling the Secretary of the Treasury to make
payments to Federal land banks which accrue during the fiscal year
ending June 30, 1934, and such additional amounts as may be necessary to make payments accruing during subsequent fiscal years .
INCREASE OF AMOUNT OF LOANS TO BORROWERS
Federal land bank
mortgage loans.
Maximum limit increased.
Vo1. 42, p . 1476 .
U.S .C ., p . 306.
Restriction .

SEC . 25. Paragraph "Seventh " of section 12 of the Federal Farm
Loan Act, as amended (U.S.C., title 12, sec . 771) (relating to the
limitations as to amount of loans), is amended by striking out
" $25,000 " and inserting " $50,000, but loans to any one borrower
shall not exceed $25,000 unless approved by the Farm Loan
Commissioner ."
DIRECT LOANS

Federal
Act,
Vol.meed.
p.

Loan

SEC . 26. Section 7 of the Federal Farm Loan Act, as amended,
is amended by striking out the last paragraph and inserting in lieu
thereof the followin g new paragraphs
Direct loans on first
mortgages to farmers
" Whenever it shall appear to the Farm Loan Commissioner that
able to apply to
Federal land bank, etc . national farm-loan associations have not been formed in any locality
in the continental United States, or that the farmers residing in
the territory covered by the charter of a national farm-loan association are unable to apply to the Federal land bank of the district for
loans on account of the inability of the bank to accept applications
from such association, the- Farm Loan Commissioner shall authorize
said bank to make direct loans to borrowers secured by first morton farm lands situated within any such locality or territory .
- provisions govern- gages
Except as herein otherwise specifically provided, all provisions of
this Act applicable with respect to loans made through national
farm-loan associations shall, insofar as practicable, apply with
respect to such direct loans, and the Farm Loan Commissioner is
authorized to make such rules and regulations as he may deem
necessary with respect to such direct loans .
Interest rate.
" The rate of interest on such direct loans made at any time by any
Federal land bank shall be one-half of 1 per centum per annum
in excess of the rate of interest charged to borrowers on mortgage
loans made at such time by the bank through national farm-loan
Borrower required to iiSSOC1at10IIS.
covenant for propor"Each borrower who obtains a direct loan from a Federal land
stock in such
bank shall subscribe and pay for stock in such bank in the sum of
bank,
$5 for each $100 or fraction thereof borrowed . Such stock shall
Use as collateral sebe held by such Federal land bank as collateral security for the loan
cmtity, etc .
of the borrower and shall participate in all dividends . Upon full
upon
payment of the loan such stock shall, if still outstanding, be canloans repayment .
celed at par, or, in the event that such stock shall have become
impaired, at the estimated value thereof as approved by the Farm
Loan Commissioner, and the proceeds thereof shall be paid to the
borrower .

.c,

30.

73d CONGRESS .

SESS . I . CH . 25.

MAY

12, 1933 .

45

`~ Each such borrower may covenant in his mortgage that, when- naBoronerrngto
join
coveassociation when
there are ten or more borrowers who have obtained from a loan
locally formed .
Federal land bank direct loans under the provisions of this section
aggregating not less than $20,000, and who reside in a locality which
may, in the opinion of the Farm Loan Commissioner, be conveniently
covered by the charter of and served by a national farm-loan association, he will unite with such other borrowers to form a national
farm-loan association . Such borrowers shall organize the associa- Organization, etc•
tion subject to the requirements and the conditions specified in this
section, so far as the same may be applicable, and in accordance with
rules and regulations of the Farm Loan Commissioner . As soon as Exchange of stock.
the organization of the association has been approved by the Farm
Loan Commissioner, the stock in the Federal land bank held by
each of the members of such association shall be canceled at par, and
in lieu thereof the bank shall issue in the name of the association an
equal amount of stock in said bank, which stock shall be held by said
collateral
bank as collateral security as provided in this section with respect seHnrityo
to other loans through national farm-loan associations . Thereupon
there shall be issued to each such member an amount of capital useIsasofeapitalstock;
collateral .
stock in the association equal to the amount which he previously
held in said bank, which stock shall be held by said association as colLiability for paylateral security as provided in section 8 of this Act . The board of ment
of mortgages .
directors of said association shall adopt a resolution authorizing
and directing its secretary-treasurer on behalf of said association to
endorse, and thereby become liable for the payment of, the mortgages taken from its charter members by the Federal land bank .
When it shall appear to the satisfaction of the Farm Loan Commis- Interest reduced
when conditions comsioner that all the foregoing conditions have been complied with > plied
with .
and upon the granting of the charter by the Farm Loan Commissioner, the interest rate paid by each charter member of such association whose loan is in good standing shall, beginning with his
next regular installment date, be reduced to the rate of interest paid
by borrowers on new loans made through national farm-loan associations in the same Federal land-bank district at the time the said
loan was made to such charter member .
for direct
" Charges to be paid by applicants for direct loans from a Federal I.e...
land bank shall not exceed amounts to be fixed by the Farm Loan
Commissioner and shall in no case exceed the charges which may
be made to applicants for loans and borrowers through national Vol . 39, pp . 369, 372
farm-loan associations under the provisions of sections 11 and 13
of this Act."
LOANS TO RECEIVERS
SEC . 27. Any receiver appointed by the Federal Farm Loan Board
pursuant to section 29 of the Federal Farm Loan Act, as amended,
or any receiver appointed by a district court of the United States,
is authorized, for the purpose of paying taxes on farm real estate
owned by the bank or securing the mortgages held by it, with the
approval of the Farm Loan Commissioner, to borrow from the
Reconstruction Finance Corporation and to issue receiver's certificates against the assets of such bank as security for any loan received
from the Corporation under this section, and such certificates shall
constitute a prior lien on such assets . The Reconstruction Finance
Corporation is authorized to make loans to such receivers for the purposes of this section .

Receivers to borrow
on security of receiver's
certificates for paying
taxes, etc .
Vol . 39, p . 381.

Prior lien constituted .

Reconstruction Finance Corporation to
make such loans .

46

'3d CONGRESS . SESS . I . CH . 25 . MAY 12, 1933 .
FEDERAL FARM-LOAN BONDS AS SECURITY FOR ADVANCES
RESERVE BANKS

Farm loan bonds as
security
advances

deal

Banks
.338, p . 263,
Vol. 39, p. 384; Vol .

44

Antep . 41 .

Joint-stock
banks .

PART 2-JOINT-STOCK LAND BANKS
LIMITATIONS ON

Fi-

Loans to joint-Stock
land banks, to provide
orderly liquidation ..

Interest rate .

Maxiniumamount,

Collateral security .

Appraisal of.
U .S . C ., p .304.
Loans not to exceed
60 percent of collateral
value ..
Fees

Agreement by bank
to reduce interest upon
all first mortgages to
6percent.

Not to
proceed
. mortgagor to
default

ISSUE OF

BONDS AND LENDING

SEC . 29 . After the date of enactment of this Act, no joint-stock
land bank shall issue any tax-exempt bonds or make any farm loans
except such as are necessary and incidental to the refinancing of
existing loans or bond issues or to the sale of any real estate now
owned or hereafter acquired by such bank.
LOANS

Reconstruction

rWERAL

SEC. 28 . The eighth paragraph of section 13 of the Federal Reserve
Act, as amended, is amended by inserting before the period at the
end thereof a comma and the following : " or by the deposit or pledge
of bonds issued pursuant to the paragraph added to section 32 of the
Federal Farm Loan Act, as amended by section 21 of the Emergency
Farm Mortgage Act of 1933."

I a n d

Limitations on issue
ofbonds and lending,

BY

TO

JOINT-STOCK LAND BANKS

TO

PROVIDE FOR ORDERLY LIQUIDATION

SEC . 30. (a) The Reconstruction Finance Corporation is authorized and directed to make available to the Farm Loan Commissioner,
out of the funds of the Corporation, the sum of $100,000,000, to be
used, for a period not exceeding two years from the date of enactment of this Act, for the purpose of making loans to the joint-stock
land banks organized and doing business under the Federal Farm
Loan Act, as amended, at a rate of interest not to exceed 4 per
centum per annum, payable annually . Such loans shall be made
upon application therefor by such banks and upon compliance with
the requirements of this section . The amount which may be loaned
hereunder to any such bank shall not exceed an amount having the
same proportion to the said $100,000,000 as the unpaid principal of
the mortgages held by such bank on the date of enactment of this
Act bears to the total amount of the unpaid principal of the mortgages held by all the joint-stock land banks on such date .
(b) Any joint-stock land bank applying for a loan under this
section shall deliver to the Farm Loan Commissioner as collateral
security therefor first mortgages or purchase-money mortgages on
farm lands, first mortgages on farm real estate owned by the bank
in fee simple, or such other collateral as may be available to said
bank, including sales contracts and sheriff's certificates on farm
lands . The real estate upon which such collateral is based shall be
appraised by appraisers appointed under the Federal Farm Loan
Act, as amended, and the borrowing bank shall be entitled to borrow
not to exceed 60 per centum of the normal value of such real estate as
determined by such appraisal . Fees for such appraisals shall be
paid by the applicant banks in such amounts as may be fixed by the
Farm Loan Commissioner. No such loan shall be made until the
applicant bank, under regulations to be prescribed by the Farm
Loan Commissioner (1) shall have agreed to grant to each borrower
then indebted to the bank under the terms of a first mortgage a
reduction to 5 per centum per annum in the rate of interest specified in such mortgage, beginning at his next regular installment date
occurring more than sixty days after the date of enactment of this
Act, and (2) shall have agreed to the satisfaction of the Commissioner that during a period of two years from the date of enactment
of this Act the bank will not proceed against the mortgagor on
account of default

73d

CONGRESS . SESS .

I. CH. 25 . MAY 12, 1933.

the terms of its mortgage and will not foreclose its mortgage unless
the property covered by such mortgage is abandoned by the mortgagor or unless, in the opinion of the Commissioner, such foreclosure is necessary for other reasons . Such loans shall be made to
aid the orderly liquidation of any such bank in accordance with such
plan as may be approved by the Farm Loan Commissioner . Before
any such plan is approved by the Commissioner he shall be satisfied
that the plan carries out the purposes of this section and that such
part of the proceeds of the loan as is devoted to settlements with
bondholders will be used only to effect an equitable settlement with
all bondholders. After the plan has been approved by the Commissioner he shall require the bank to mail a copy thereof to all its
known bondholders and to publish a notice setting forth its provisions in at least three newspapers having general circulation .

47
ceNot too fooreo se a exwhen
ment, etc .

Approval necessary .

Notice to bondholders, etc .

LOANS BY THE FARM LOAN COMMISSIONER TO JOINT-STOCK LAND BANKS
POR EMERGENCY PURPOSES
Farm Loan Commis.
SEC . 31 . (a) Out of the funds made available to him under see- sioner
.
Loans by, to jointtion 30, the Farm Loan Commissioner is authorized to make loans, stock
banks, for
in an aggregate amount not exceeding $25,000,000, at a rate of interest certainland
emergencies .
not to exceed 4 per centum per annum, to any joint-stock land bank
for the purpose of securing the postponement for two years from
the date of the enactment of this Act of the foreclosure of first mortgages held by such banks on account of (1) default in the payment fault ccointeref deof interest and principal due under the terms of the mortgage, and princip al .
(2) unpaid delinquent taxes, excluding interest and penalties, which "'in"uenttases,etc.
may be secured by the lien of said mortgage :- Provided, That during Provisos . rate dnrin g
the period of postponement of foreclosure such bank shall charge period.
the mortgagor interest at a rate not exceeding 4 per centum per
annum on the aggregate amount of such delinquent taxes and
defaulted interest and principal with respect to which loans are
made pursuant to this section . The amount loaned to any joint-stock sa Reappraisalunnecesland bank under this section shall be made without reappraisal :
Provided, That the amount loaned with respect to any mortgage on Maximum loan on
account of unpaid principal shall not exceed 5 per centum of the cipaluntofnnpaiaprintotal unpaid principal of such mortgage, and the total amount
loaned to any such land bank with respect to any mortgage shall not
exceed 25 per centum of the total unpaid principal of such mortgage .
(b) No such loan shall be made with respect to any mortgage
iitions for makd
unless the Farm Loan Commissioner is satisfied that the mortgagor, inCo
Default ofmortgagor .
after exercising ordinary diligence to pay his accrued delinquent
taxes, and meet accrued interest and principal payments, has
defaulted thereon ; and unless the bank shall have agreed to the satisBank will not forefaction of the Farm Loan Commissioner that during such two-year close
.
period the bank will not foreclose such mortgage unless the prop- Exceptions.
erty covered thereby is abandoned by the mortgagor or unless in
the opinion of the Farm Loan Commissioner such foreclosure is
necessary for other reasons.
Loan to be secured
(c) Each such loan shall be secured by an assignment to the Farm by assignment of tax
Loan Commissioner of the lien of the taxes and/or of the bank's lien, mortgage, etc.
mortgage with respect to which the loan is made : Provided, That status' of assigned
the part of each such lien so assigned representing the interest and lien .
principal due and unpaid in any such mortgage which has been
assigned to the farm loan registrar shall be subordinate to the
existing lien of the bank for the balance of the indebtedness then or
thereafter to become due under the terms of such mortgage ; but the
Additional collateral
Farm Loan Commissioner may require the bank to furnish addi- m ay
be required .
tional collateral as security for such loan, if such collateral is
available to the bank .

48

73d CONGRESS. SESS . I.

CH. 25 . MAY 12, 1933.

Rules, etc ., authorized .

(d) The Farm Loan Commissioner is authorized to make such
rules and regulations as may be necessary to carry out the purposes
of this section and to make the relief contemplated immediately
available .

Loans to farmers by
Farm Loan Commissioner.

PART 3-LOANS TO FARMERS BY FARM LOAN COMMISSIONER
REDUCTION OF DEBTS AND REDEMPTION OF FORECLOSED FARMS

SEC. 32 . The Reconstruction Finance Corporation is authorized
and directed to allocate and make available to the Farm Loan Coinmissioner the sum of $200,000,000, or so much thereof as may be
necessary, to be used for the purpose of making loans as hereinafter
provided to any farmer, secured by a first or second mortgage upon
security .
the whole or any part of the farm property, real or personal,
Maximum amount, including crops, of the farmer . The amount of the mortgage given
including existing inby any farmer, together with all prior mortgages or other evidences
debtedness .
o f indebtedness secured by such farm property of the farmer, shall
not
exceed 75 per centum of the normal value thereof, as determined
L S C
., p . 304 .
upon an appraisal made pursuant to the Federal Farm Loan Act, as
Post, p . 347 .
amended ; nor shall a loan in excess of $5,000, be made to any one
repayenAmortization plan of farmer . Every mortgage made under this section shall contain
an agreement providing for the repayment of the loan on an amortization plan by means of a fixed number of annual or semiannual
installments, sufficient to cover (1) interest on unpaid principal at
a rate not to exceed 5 per centum per annum and (2) such payments
equal in amount to be - applied on principal as will extinguish the
debt within an agreed period of not more than ten years or, in the
case of a first or second mortgage secured wholly by real property
and made for the purpose of reducing and refinancing an existing
mortgage within an ,agreed period no greater than that for which
loans may be made under the Federal Farm Loan Act, as amended,
Proaiso .
Payments on prin- from the date the first payment on principal is due : Provided, That
ci st 3
if ended during the first three years the loan is in effect payments of interest
first years,
not m
default .
only ay be required if the borrower shall not be in default with
respect to any other condition or covenant of his mortgage. No
Agreem
er of prior mortgageortiahbold- loan shall be made under this section unless the holder of any prior
mortgage or instrument of indebtedness secured by such farm property arranges to the satisfaction of the Farm Loan Commissioner
to limit his right to proceed against the farmer and such farm
Purposes set forth .
property for default in payment of principal. Loans under this
Refinancing indebt- Section shall be made for the following purposes only
: (1) Refinancedness
ing, either in connection with proceedings under chapter VIII
Vol . 47, p . 1467 .
of the Bankruptcy Act of July 1, 1898, as amended (relating
to agricultural compositions and extensions), or otherwise, any
Providing working indebtedness, secured or unsecured, of the farmer, (2) providing
capital .
Redemption or re- working capital for his farm operations, and (3) enabling any
of
farm farmer to redeem and/or repurchase farm property owned by him
purchase
Post, p. 929.
prior to foreclosure which has been foreclosed at any time between
July 1, 1931, and the date of the enactment of this Act, or which is
Chargesn borrowers. foreclosed after the enactment of this Act . The provisions of paragraph "Ninth" of section 13 of the Federal Farm Loan Act, as
amended (relating to charges to applicants for loans and borrowers
from the Federal land banks), shall, so far as practicable, apply to
"Farmer" defined.
loans made under this section . As used in this section, the terni
" farmer " means any individual who is bona fide engaged in farming
operations, either personally or through an agent or tenant, or the
principal part of whose income is derived from farming operations,
and includes a personal representative of a deceased farmer .
duteccttloans~able for
Post, pp . 345, 34e,
347, 1060.

73d CONGRESS . SESS . I.

CH. 25 . MAY 12, 1933 .

REGULATIONS
SEC . 33 . The Farm Loan Commissioner is authorized to make
such rules and regulations, and to appoint, employ, and fix the compensation of such officers, employees, attorneys, and agents as may
be necessary to carry out the purposes of this title and to make the
relief contemplated by this title immediately available, without
regard to the provisions of other laws applicable to the employment
and compensation of officers and employees of the United States
Provided, That no salary or compensation in excess of $10 .000 shall
be paid to any person employed under the terms of the foregoing
section.

49
Regulations .
Authority of Farm
Loan Commissioner to
make ; to fix componsation rates, etc.

Salary restriction .

FACILITIES OF FEDERAL LAND BANKS AND NATIONAL FARM LOAN ASSOCIATIONS MADE AVAILABLE

SEC . 34. The Federal land banks and the national farm loan
associations are authorized, upon request of the Farm Loan Commissioner, to make available to him their services and facilities to aid
in administering the provisions of this title .

Facilities made available .

PENALTIES

35 . Any person who shall knowingly make any material false
representation for the purpose of obtaining any loan under part 3
of this title, or in assisting in obtaining any such loan, shall, upon
conviction thereof, be fined not more than $1,000, or imprisoned not
more than six months, or both .
SEC .

PART 4-REFINANCING oI AGRICULTURAL IMPROVEMENT DISTRICT

Penalties_

Refinancing of agricultural improvement
cultural
district indebtedness .

INDEBTEDNESS FOR THE BENEFIT OF FARMERS
LOANS BY RECONSTRUCTION FINANCE CORPORATION

Loans by Reconstruction Finance Corporation .
Amount authorized,
to reduce and refinance
indebtedness of draindistricts .
agPost, pp
111o,
lzs9.

SEC. 36 . The Reconstruction Finance Corporation
is authorized
11
and empowered to make loans as hereinafter provided, in an aggregate amount not exceeding $50,000,000 ; to drainage districts, levee districts, levee and drainage districts, irrigation districts, and similar
districts, duly organized under the laws of any State, and to political State subdivision a g subdivisions of States, which prior to the date of enactment of this Act, ricultural projects .
have completed projects devoted chiefly to the improvement of lands
for agricultural purposes . Such loans shall be made for the purpose of
enabling any such district or political subdivision (hereafter referred
and condito as the " borrower ") to reduce and refinance its outstanding indebt- ti
incurred in connection with any such project, and shall be on'*
pp 6,714 .
subject to the same terms and conditions as loans made under section Vol . 47,
5 of the Reconstruction Finance Corporation Act, as amended ; except p. 67.c ., Supp . VII,
that (1) the term of any such loan shall not exceed forty years ; (2) Term limitation
.
each such loan shall be secured by refunding bonds issued to the Security .
Corporation by the borrower which are a lien on the real property
within the project or on the amount of the assessments levied on
such property by the borrower pursuant to State law, or by such Bonds not to issue
Corporation's
other collateral as may be acceptable to the Corporation ; (3) the without
borrower shall agree not to issue during the term of the loan any Consent .
bonds so secured except with the consent of the Corporation ; (4) Payment of excess
interest,
the borrower shall pay to the Corporation, until all bonds of the overoperation,
outstanding
borrower held by the Corporation are retired, an amount equal to bondsuntilretired
.
the amount by which the assessments against the real property within Post, p .1110 .
the project collected by the borrower exceed the costs of operation
56637°-34

4

50

73d CONGRESS .

SESS . I .

CH . 25 .

MAY 12, 1933.

and maintenance of the project and interest on its outstanding obliCorrespondingreduc- ations ; and (5) the borrower shall agree, to the satisfaction of the
tion of indebtedness to g
borrower.
Corporation, to reduce the outstanding indebtedness to the borrower
Post, p.1269 .
of the landowners within such project by an amount corresponding
to that by which the indebtedness of the borrower is reduced by
Pro rata basis .
reason of the operation of this section, to distribute the amount of
such reduction among such landowners on a pro rata basis, to cancel
Cancellation
to equal and retire its outstanding bonds in an aggregate amount equal to
distribreduction so
the amount of the reduction so distributed, and to permit the Coruted*
Corporatlon
to par- poration, in the case of the payment of the bonds of the borrower
ticipate
.
or the liquidation of such project, to participate in such payment
or in the proceeds of such liquidation on the basis of the face amount
of the bonds so retired plus the face amount of the bonds held by
Requirements to be the Corporation as security for the loan . No loan shall be made
met before loan made . under this section until the Reconstruction Finance Corporation (A)
has caused an appraisal to be made of the property securing and/or
underlying the outstanding bonds of the applicant, (B) has determined that the project of the applicant is economically sound, and
Post, p 1269.
(C) has been satisfied that an agreement has been entered into
between the applicant and the holders of its outstanding bonds under
which the applicant will be able to purchase or refund such bonds
at a price determined by the Corporation to be reasonable after
taking into consideration the average market price of such bonds
over the six months' period ending March 1, 1933, and under which
a substantial reduction will be brought about in the amount of the
outstanding indebtedness of the applicant .
Advances to reclamaSEC . 37 . The Reconstruction Finance Corporation, upon request
lion l . 47 p
t5°Vol. ii, of the Secretary of the Interior, is authorized and empowered to
p .388.
advance from funds made available by section 2 of the Act of
Maximum amount . January 22, 1932 (47 Stat .L . 5), to the reclamation fund created
by the Act of June 17, 1902 (32 Stat .L . 388), such sum or sums
Repa yment .
as the Secretary of the Interior may deem necessary, not exceeding
$5,000,000, for the completion of projects or divisions of projects
now under construction, or projects approved and authorized . Funds
so advanced shall be repaid out of any receipts and accretions accruManner of expendi- ing to the reclamation fund within such time as may be fixed by
ture .
Interest rate.
the Reconstruction Finance Corporation, not exceeding five years
from the date of advance, with interest at the rate of 4 per centum
per annum . Sums so advanced may be expended in the same way
as other moneys in the reclamation fund .
Increase of lending
power of Corporation .
Vol . 47, p . 9.
Post, p . 319.

PART 5-INCREASE

OF

SEC. 38 . In order to provide funds to carry out the purposes of
this title, the amount of notes, debentures, bonds, or other such obligations which the Reconstruction Finance Corporation is authorized
and empowered under section 9 of the Reconstruction Finance Corporation Act, as amended, to have outstanding at any one time, is
hereby increased by $300,000,000.

Farm Loan Commis- PART 6-FUNCTIONS
sioner.
Functions of, under
Executive orders.
Vol. 47, p . 413 .

LENDING POWER OF RECONSTRUCTION FINANCE
CORPORATION

OF

FARM LOAN COMMISSIONER UNDER EXECUTIVE
ORDERS

SEC . 39. If and when any executive order heretofore transmitted
to the Congress pursuant to title IV of part II of the Legislative
Appropriation Act of 1933, as amended, shall become effective, all
functions, powers, authority, and duties conferred upon or vested in
the Farm Loan Commissioner by this title shall be held and exer-

51

73d CONGRESS . SESS . I . CH . 25 . MAY 12, 1933 .
cised by him subject to all the terms and conditions in any such
Executive order the same as if such functions, powers, authority, and
duties were specifically named in such Executive order or orders .
PART 7-MISCELLANEOUS
PERFECTING ORGANIZATION FARM CREDIT ADMINISTRATION

Miscellaneous.
Farm Credit Administration .

of GovSEC. 40. The Governor of the Farm Credit Administration is Authority
ernor of, to perfect
authorized, in carrying out the powers and duties now or hereafter organization, etc .
vested in him or the Farm Credit Administration by law or under
Vol . 47, p . 413 .
any Executive order made under title IV of part II of the Legislative Appropriation Act of 1933, as amended, to establish, and to fix
the powers and duties of, such divisions, agencies, corporations, and
instrumentalities as he may deem necessary to the efficient functioning
of the Farm Credit Administration and the successful execution of
the powers and duties so vested in the Governor and the Farm Credit
No restriction on
Administration . This section shall not be construed to restrict the authority
of President.
authority of the President under title IV of such Act, as amended
Proviso
.
Provided, That no salary or compensation shall be paid to any of- Salary limitation .
ficer, agent, or other person employed under this section in excess
of $10,000 per annum .

Loans to fruit growers .
Appraising security
SEC . 41 . That in making loans to owners of groves and orchards, at fair value .
including citrus-fruit groves and other fruit groves and orchards,
the Federal land banks, the farm land banks, and all Government
agencies making loans upon such character of property may, in
appraising the property offered as security, give a reasonable and
fair valuation to the fruit trees located and growing upon said
property and constituting a substantial part of its value .
LOANS TO FRUIT GROWERS

PART 8-SHORT TITLE
SEC . 42 . This title may be cited as the "Emergency Farm
Mortgage Act of 1933 ."

Short title .

Financing : Coining
TITLE III-FINANCING-AND EXERCISING POWER CONFERRED BY money, etc .
SECTION 8 OF ARTICLE I OF THE CONSTrrUTIoN : To COIN MONEY
AND TO REGULATE THE VALUE THEREOF
SEC. 43 . Whenever the President finds, upon investigation, that
(1) the foreign commerce of the United States is adversely affected
by reason of the depreciation in the value of the currency of any
other government or governments in relation to the present standard
value of gold, or (2) action under this section is necessary in order
to regulate and maintain the parity of currency issues of the United
States, or (3) an economic emergency requires an expansion of credit,
or (4) an expansion of credit is necessary to secure by international
agreement a stabilization at proper levels of the currencies of various
governments, the President is authorized, in his discretion(a) To direct the Secretary of the Treasury to enter into agreements with the several Federal Reserve banks and with the Federal
Reserve Board whereby the Federal Reserve Board will, and it is
hereby authorized to, notwithstanding any provisions of law or
rules and regulations to the contrary, permit such reserve banks
to agree that they will, (1) conduct, pursuant to existing law,
throughout specified periods, open market operations in obligations
of the United States Government or corporations in which the

Discretionary authority of the President .
Post, p . 343 .
When U .S . commerco adversely affected by foreign currency
depreciation .
Fixing parity of currency issues .
Economic emergency
requires credit expansion .
Stabilization by international agreement .
Conduct, through
Federal Reserve Board,
open market operaCons in U.S . obligations, etc.
Post, p . 168 .

52

73d CONGRESS . SESS . I . CH . 25 . MAY 12, 1933.

United States is the majority stockholder, and (2) purchase directly
and hold in portfolio for an agreed period or periods of time
Treasury bills or other obligations of the United States Government
in an aggregate sum of $3,000,000,000 in addition to those they may
then hold, unless prior to the termination of such period or periods
Suspension of reserve the Secretary shall consent to their sale . No suspension of reserve
requirements not to
impose graduated tax requirements of the Federal Reserve banks, under the terms of secon any deficiency in
tion 11(c) of the Federal Reserve Act, necessitated by reason of
reserves .
Vol . 38, p . 262.
operations under this section, shall require the imposition of the
.S
C
,
p.
276.
U
graduated tax upon any deficiency in reserves as provided in said
Interest or discount section 11(c) . Nor shall it require any automatic increase in the
rates.
rates of interest or discount charged by any Federal Reserve bank,
as otherwise specified in that section . The Federal Reserve Board,
Measures to prevent with the approval of the Secretary of the Treasury, may require
undue credit expanthe Federal Reserve banks to take such action as may be necessary,
sion .
in the judgment of the Board and of the Secretary of the Treasury,
to prevent undue credit expansion .
If unable to secure
(b) If the Secretary, when directed by the President, is unable
assent of Federal Reserve banks to author- to secure the assent of the several Federal Reserve banks and the
.
ized agreements, etc
Federal Reserve Board to the agreements authorized in this section,
or if operations under the above provisions prove to be inadequate
to meet the purposes of this section, or if for any other reason
Authority of Presiadditional measures are required in the judgment of the President
dent.
to meet such purposes, then the President is authorizedUnited States notes
(1) To direct the Secretary of the Treasury to cause to be issued
may be issued.
in
such amount or amounts as he may from time to time order,
Vol. 12, p . 345 .
United States notes, as provided in the Act entitled "An Act to
authorize the issue of United States notes and for the redemption
of funding thereof and for funding the floating debt of the United
States", approved February 25, 1862, and Acts supplementary
Size, color, denomithereto and amendatory thereof, in the same size and of similar color
nations, etc .
to the Federal Reserve notes heretofore issued and in denominations
of $1, $5, $10, $20, $50, $100, $500, $1,000, and $10,000 ; but notes
Purposes of issue defined .
issued under this subsection shall be issued only for the purpose of
meeting maturing Federal obligations to repay sums borrowed by
the United States and for purchasing United States bonds and
Proviso .
Retirement of bonds other interest-bearing obligations of the United States : Provided,
so purchased .
That when any such notes are used for such purpose the bond or
other obligation so acquired or taken up shall be retired and canIssues, amounts, etc .
celed. Such notes shall be issued at such times and in such amounts
as the President may approve but the aggregate amount of such
Appropriation
for
notes outstanding at any time shall not exceed $3,000,000,000 . There
annual cancellation .
is hereby appropriated, out of any money in the Treasury not otherwise appropriated, an amount sufficient to enable the Secretary of
the Treasury to retire and cancel 4 per centum annually of such
outstanding notes, and the Secretary of the Treasury is hereby
directed to retire and cancel annually 4 per centum of such outNotes, etc., to be
standing notes . Such notes and all other coins and currencies herelegal tender .
Post, p . 113 .
tofore or hereafter coined or issued by or under the authority of
the United States shall be legal tender for all debts public and
private.
President, byw
proclaeight
(2) By proclamation to fix the weight of the gold dollar in grains
mation, may fix
of gold dollar .
nine
tenths fine and also to fix the weight of the silver dollar in
Silver dollar .
Post, p. 344 .
grains nine tenths fine at a definite fixed ratio in relation to the gold
dollar at such amounts as he finds necessary from his investigation
to stabilize domestic prices or to protect the foreign commerce
Unlimited coinage of
gold and silver dollar against the adverse effect of depreciated foreign currencies, and
at fixed ratio .
to provide for the unlimited coinage of such gold and silver at
the ratio so fixed, or in case the Government of the United States
Purchasedirectlyand
hold Treasury bills, etc .,
additional to present
holdings .

73d CONGRESS.

53

SESS. I. CH. 25. MAY 12, 1933 .

enters into an agreement with any government or governments
under the terms of which the ratio between the value of gold and
other currency issued by the United States and by any such government or governments is established, the President may fix the weight
of the gold dollar in accordance with the ratio so agreed upon, and
such gold dollar, the weight of which is so fixed, shall be the standard
unit of value, and all forms of money issued or coined by the United
States shall be maintained at a parity with this standard and it
shall be the duty of the Secretary of the Treasury to maintain such
parity, but in no event shall the weight of the gold dollar be fixed
so as to reduce its present weight by more than 50 per centum .
SEC. 44. The Secretary of the Treasury, with the approval of the
President, is hereby authorized to make and promulgate rules and
regulations covering any action taken or to be taken by the President under subsection (a) or (b) of section 43 .
SEC . 45. (a) The President is authorized, for a period of six
months from the date of the passage of this Act, to accept silver in
payment of the whole or any part of the principal or interest now
due, or to become due within six months after such date, from any
foreign government or governments on account of any indebtedness
to the United States, such silver to be accepted at not to exceed the
price of 50 cents an ounce in United States currency. The aggreate value of the silver accepted under this section shall not exceed
200,000,000 .
(b) The silver bullion accepted and received under the provisions
of this section shall be subject to the requirements of existing law
and the regulations of the mint service governing the methods of
determining the amount of pure silver contained, and the amount
of the charges or deductions, if any, to be made ; but such silver
bullion shall not be counted as part of the silver bullion authorized
or required to be purchased and coined under the provisions of
existing law .
(c) The silver accepted and received under the provisions of this
section shall be deposited in the Treasury of the United States, to
be held, used, and disposed of as in this section provided .
(d) The Secretary of the Treasury shall cause silver certificates
to be issued in such denominations as he deems advisable to the
total number of dollars for which such silver was accepted in payment of debts . Such silver certificates shall be used by the Treasurer
of the United States in payment of any obligations of the United
States .
(e) The silver so accepted and received under this section shall
be coined into standard silver dollars and subsidiary coins sufficient,
in the opinion of the Secretary of the Treasury, to meet any demands
for redemption of such silver certificates issued under the provisions
of this section, and such coins shall be retained in the Treasury for
the payment of such certificates on demand . The silver so accepted
and received under this section, except so much thereof as is coined
under the provisions of this section, shall be held in the Treasury
for the sole purpose of aiding in maintaining the parity of such certificates as provided in existing law . Any such certificates or reissued certificates, when presented at the Treasury, shall be redeemed
in standard silver dollars, or in subsidiary silver coin, at the option
of the holder of the certificates : Provided, That, in the redemption
of such silver certificates issued under this section, not to exceed one
third of the coin required for such redemption may in the judgment
of the Secretary of the Treasury be made in subsidiary coins, the
balance to be made in standard silver dollars .

Weight of gold dollar
fixed by international
agreement .

To be standard unit
of value.

Parity maintenance .
Minimum weight of
gold dollar .
Post, p . 342 .

Rules, etc ., to be
promulgated .
Ante, p. 51 .

Acceptance of silver
for ensuing six months,
indebtedness of foreign
governments.

Limitation on aggregate amount

Silver bullion to be
subject to law requirements .

Deposit in Treasury
for uses designated .

Silver
certificates,
issue of .
Post, p . 342 .

Coinage .

Redemption.

Purpose of aiding in
maintaining parity of
certificates.

Certificates redeemable in silver dollars,
etc.
Protuo.
Subsidiary coins .

54

73d CONGRESS .

Silver
certificates
may reissue .

Cancellation, etc.,c of
mutilated certificates.

Rules to be prescribed.

Federal Reserve Act,
amendment.
Vol . 38, p . 271 .
U .S .C ., p . 287.
Emergency due to
credit expansion.
Federal Reserve
Board may so declare,
and modify reserve
balances, etc.

SESS. I.

CHS . 25-27 .

MAY 12, 1933 .

(f) When any silver certificates issued under the provisions of this
section are redeemed or received into the Treasury from any source
whatsoever, and belong to the United States, they shall not be
retired, canceled, or destroyed, but shall be reissued and paid out
again and kept in circulation ; but nothing herein shall prevent the
cancelation and destruction of mutilated certificates and the issue
of other certificates of like denomination in their stead, as provided
by law .
(g) The Secretary of the Treasury is authorized to make rules and
regulations for carrying out the provisions of this section .
SEC. 46. Section 19 of the Federal Reserve Act, as amended, is
amended by inserting immediately after paragraph (c) thereof the
following new paragraph
" Notwithstanding the foregoing provisions of this section, the
Federal Reserve Board, upon the affirmative vote of not less than
five of its members and with the approval of the President, may
declare that an emergency exists by reason of credit expansion, and
may by regulation during such emergency increase or decrease from
time to time, in its discretion, the reserve balances required to be
maintained against either demand or time deposits ."
Approved, May 12, 1933 .
[CHAPTER 26 .]

May 12, 1933,
[H.R . 48 .1
[Public, No . 11 .1

Time
ime extended far
bridging, at Kansas
City, Bans .
Vol . 45, pp. 704, 1530;
Vol. 46,p .835,amended .

Amendment .

AN ACT

To extend the time for completing the construction of a bridge across the Missour! River at or near Kansas City, Kansas .
Be it enacted by the Senate and House of Representatives of the
United States o f America in Congress assembled, That the time for
completing the construction of a bridge across the Missouri River at
or near Kansas City, Kansas, authorized to be built by the Interstate
Bridge Company, its successors and assigns, by an Act of Congress
approved May 22, 1928, heretofore extended by Acts of Congress
approved March 2, 1929, and June 30, 1930, is hereby further extended two years from May 22, 1933 .
SEC . 2. The right to alter, amend, or repeal this Act is hereby
expressly reserve
Approved, May 12, 1933 .
[CHAPTER 27 .]

May 12, 1933 .
[H .R. 1596.1
[Public, No. 12.1

Pee Dee and Wacca.
maw Rivers.
Time extended for
bridging , at George. 6,

p.

amended

Amendment .

479,

AN ACT

extend the times for commencing and completing the construction of a bridge
across the Pee Dee River and a bridge across the Waccamaw River, both at or
near Georgetown, South Carolina .

To

Be it enacted by the Senate and House o f Representatives
of the
p
United States o f America in Congress assembled, That the times for
commencing and completing the construction of a bridge across the
Pee Dee River and a bridge across the Waccamaw River, both at or
near Georgetown, South Carolina, authorized to be built by the
county of Georgetown, South Carolina, by an Act of Congress approved May 29, 1930, are hereby extended one and three years, respectively, from May 29, 1933 .
SEC . 2. The right to alter, amend, or repeal this Act is hereby
expressly reserved .
Approved, May 12, 1933 .