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ANNUAL REPORT OF THE
SECRETARY OF THE TREASURY
ON THE .STATE O F THF. FINANrF.S
FOR FISCAL YEAR ENDED JUNE 30,1935

ANNUAL REPORT OF THE
SECRETARY OF THE TREASURY
ON

THE STATE OF THE
FINANCES

FOR THE FISCAL YEAR
ENDED JUNE 30

1935

UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON : 1936

TREASURY DEPARTIVIENT

Docui^ENT No. 3072
Secretary

CONTENTS
Page'

Budget results
i^
Receipts
. ^^
Income taxes
^'^
Miscellaneous internal revenue
._
Agricultural adjustment taxes
Customs
Miscellaneous receipts
Expenditures
The public debt
Issues during the year
Second Liberty Bond Act—Further amendments
Cumulative sinking fund
Refunding of Fourth Liberty Loan continued
Refunding of First Liberty Loan.
Redemption of 2 percent bonds
.
United States Savings Bonds
:
^
General Fund of the Treasury
^
Emergency legislation
f
Revenue legislation
I
Extension of temporary taxes and increaseci postal rates
Publicity of income tax returns
Revision and extension of agricultural adjustment taxes
^.
Estimates of receipts and expenditures
Fiscalyear 1936
Fiscalyear 1937
Silver, silver certificates, and national bank notes
Silver
..
.
i
Silver certificates
National bank notes
I
Bureau of Internal Revenue
.
Back taxes on incomes
Alcohol tax administration
.
Construction activities of the Treasury
)
The original public building program
Building program in the District of Columbia
Program under the Public Works Administration
^
Program under the Emergency Appropriation Act
Program for other departments
Bureau of Customs..
Nonfiscal activities
.
Coast Guard
Public Health Service
Bureau of Narcotics
.
Organization changes
'•-..•

..
._
__.

1
1
3
3
5
5
5
5
12
16
18
18
19
21
22
23
.25
26
30
30
30
30
32
36
38
41
41
42
44
44
44
44
45
45
46
46
46
47
47
48
48
48
51
52

ADMINISTRATIVE REPORTS OF BUREAUS AND DIVISIONS
Accounts and Deposits, Office of the Commissioner of
Combined statement of assets and Habilities of governmental corporations and credit agencies
Securities owned by the United States Government
.
^
Contingent liabilities of the United States
Accounting and disbursing of Emergency Relief funds appropriated
under the Emergency Relief Appropriation Act of 1935

III

55
55
55
57
57

CONTENDS

Accounts and Deposits, Office of the Commissioner of—Continued. '
Page
Obhgations of foreign governments
58
Receipts from Germany
59
Army costs
,
59
Mixed claims. United States and Germany
60
Annuities under moratorium agreement
60
Treasury administration of alien and mixed claims
60
Mixed Claims Commission: Claims against Germany
61
War Claims Arbiter
^
64
Claims of German nationals
64
Claims of Hungarian nationals.
64
German special deposit account
64
Tripartite Claims Commission
65
Claims against Austria
.
65
Claims against Hungary
65
Railroad obligations
66
Section 204
1
66
Section 207
66
Sections 209 and 212
67
Section 210__
67
Trust funds invested by the Treasury
_:_.
68
Adjusted service certificate fund
68
Civil service retirement and disability fund
68
Foreign service retirement and disability fund
69
Canal Zone retirement and disability fund
70
District of Columbia teachers' retirement fund
71
Longshoremen's and harbor workers' compensation fund
73
District of Columbia workers' compensation fund
73
Library of Congress trust fund
\^
74
United States Government life insurance fund
77
National Institute of Health gift fund_":
78
Alien property trust fund
79
General railroad contingent fund
80
Pershing Hall Memorial fund
80
Special funds
.
_-_
81
Colorado River Dam fund
81
Advances to reclamation fund
82
Division of Deposits
. 83
Section of Surety Bonds
84
Division of Bookkeeping and Warrants. .
84
Division of Disbursement
84
Appointments, Division of
i^
85
Number of employees '
.
85
Retirement of employees
86
Budget and Improvement Committee
86
Coast Guard
..
87
Protection to navigation
87
Enforcement of customs and other laws
88
Communications
89
Equipment
90
The academy, stations, bases, repair depot, engine school, repair
base, etc
92
Engineering competition
93
Personnel
.
—
93
Awards of life-saving medals
93
Appropriations and expenditures..,
94
Comptroller of the Currency
,
95
Changes in the condition of national banks
95
Reopening and reorganization of national banks
96
Summary of changes in membership in the national banking system__
98
Customs, Bureau of
.
98
Collections
.
.
...
98
Volume of business
99
Enforcement activities
_.;
._
100
Smuggling
.
.—
101
Miscellaneous
102
Investigative Unit
102
Engraving and Printing, Bureau of
104

CONTENTS

V
Page

Enrollment and Disbarment of Attorneys and Agents, Committee on
I n t e r n a l Revenue, Bureau of
General
Internal revenue collections
Refunds
.
. Additional assessments
Cost of administration
Income Tax Unit
Additional revenue
Final notices of deficiency (90-day letters)
Claims a n d overassessments
Returns on h a n d
Audit in Washington
Audit in t h e
field
T h e Technical Staff
.
:.
Miscellaneous Tax Unit
E s t a t e Tax Division
Tobacco Division
"
-..
Silver Tax Division
Sales Tax Division
Processing Tax Division
Capital Stock Tax Division
Alcohol Tax U n i t . . . :
Enforcement Division
Audit Division
,
Laboratory Division..
Accounts and CoUections Unit
Collection Accounting Division
.^
:
Collectors' Personnel, Equipment,. and Space Division
Disbursement Accounting Division
Office of the Assistant General C o u n s e l .
Assistant General Counsel's Committee
.
Reorganization Section
Appeals Division
CivU Division
'_
Compromise Section
Interpretative Division
Penal Division
Review Division
Legislative and Regulations Division. .!
Intelligence Unit
Legal Division
Mint, Bureau of t h e
Institutions of t h e M i n t Service
Coinage
.
Bullion deposit transactions
Gold operations
:
Silver operations
.
Commemorative coins
Refineries
.
;
Stock of coin a n d m o n e t a r y bullion in t h e United States
Production of gold a n d silver
Industrial consumption of gold a n d silver
Appropriations, expenses, and income
...
Narcotics, Bureau of
1
Enforcement activities
^
E x t e n t and trend of narcotic traffic
Division of Printing
Printing and binding
Stationery supplies
:
D e p a r t m e n t advertising
Engraving work
Procurement Division
Branch of Supply
PubHc Works Branch
Office of t h e Supervising Architect
Office of the Supervising Engineer
^

107
108
108
108
108
109
110
110
111
112
113
113
114
114
115
115
116
118
118
118
121
123
124
124
124
125
125
125
126
127
127
128
128
128
129
130
131
131
132
132
132
133
134
134
135
135
135
136
136
136
137
137
137
137
138
138
140
140
141
143
143
143
143
143
148
148
148

CONTENTS

Procurement Division—Continued.
PubHc Works Branch—Continued.
Section of Painting and Sbulpture
Original public building program
Program under the Public Works Administration
Relief program
Emergency construction program
^^
Private architectural services
Administration and cost of Federal buildings under the control
of the Treasury Department
Expenditures
Public Debt Service
Division of Loans and Currency....
Register of the Treasury
Division of Public Debt Accounts and Audit
'.
Division of Paper Custody
Destruction Committee
.
Public Health Service
Division of Sanitary Reports and Statistics
Division of Foreign and Insular Quarantine
.
Division of Domestic Quarantine
Division of Scientific Research
Division of Marine Hospitals and Relief
Division of Venereal Diseases
Division of Mental Hygiene
Division of Personnel and Accounts
Division of Research and Statistics
Taxation
Federal
financing
Monetary problems
..
..
Actuarial analysis
•
Secret Service Division.
Treasurer of the United States
^._
War Finance Corporation

Page
148
149
149
150
150
151
151
151
153
153
156
158
159
160
161
161
162
164
165
167
167
168
169
170
170
171
171
171
172
173
177

EXHIBITS
THE PUBLIC DEBT

Issues and Redemptions of United States Bonds, Notes, and Certificates of
Indebtedness
Exhibit 1. Offering of IJ^-percent Treasury notes of series D-1936, 2J4percent Treasury notes of series D-1938, and 3J4-percent Treasury
bonds of 1944-46 (additional)
:
.
181
Exhibit 2. Allotments on exchange subscriptions. Treasury notes of
series D-1936 and series D-1938, and Treasury bonds of 1944r-46
186
Exhibit 3. Partial redemption on April 15, 1935, of Fourth Liberty Loan
bonds before maturity (third call)
187
Exhibit 4. Offering of 3>^-percent Treasury bonds'of 1949-52, l}^-percent
Treasury notes of series E-1936, and 2}^-percent Treasury notes of
series A-1939 (additional)
192
Exhibit 5. Subscriptions and allotments, Treasury bonds of 1949-52 and
Treasury notes of series E-1936 and series A-1939
195
Exhibit 6. Offering of United States Savings Bonds, series A
197
Exhibit 7. Sales of United States Savings Bonds from March 1 to June
30 1935 _
. _ _
_
_
199
Exhibit 8. 'o"ffering of 2J4-percent Treasury bonds of l~955-60" and 1^percent Treasury notes of series A-1940___.^__
200
Exhibit 9. Allotments on exchange subscriptions. Treasury bonds of
° 1955-60 and Treasury notes of series A-1940
204
Exhibit 10. Call for redemption of 2-percent consols of 1930 and 2-percent
Panama Canal Loan bonds of 1916-36 and 1918-38 on July 1 and August
1, 1935, respectively
.
204
Exhibit 11. Call for redemption of First Liberty Loan bonds of 1932-47 on
June 15, 1935
.
210
Exhibit 12. Call for redemption on October 15, 1935, of Fourth Liberty
Loan bonds before maturity (final call)
, 214
Exhibit 13. Offering of 2%-percent Treasury bonds of 1955-60 (additional)
and 1%-percent Treasury notes of series A-1940 (additional).
217

CONTENTS

Exhibit 14. Allotments on exchange subscriptions; Treasury bonds of
1955-60 and Treasury notes of series A-1940
Exhibit 15. Refunding of the First Liberty Loan, March 15 to June 30,
1935
.__
Exhibit 16. Inviting tenders for 3-percent Treasury bonds of 1946-48
(additional)
Exhibit 17. Acceptance of tenders for Treasury bonds of 1946-48
Exhibit 18. Offering of l}^-percent Treasury notes of series B-1940
Exhibit 19. Allotments on exchange subscriptions. Treasury notes of
series B-1940
_...
Exhibit 20. Inviting tenders for 3-percent Treasury bonds of 1946-48
(additional).
Exhibit 21. Acceptance of tenders for Treasury bonds of 1946-48

Vn
Page
222
223
223
225
225
226
227
228

Issues of Treasury Bills
Exhibit 22. Inviting tenders for Treasury biUs dated July 3, 1934, and
maturing January 2, 1935.
Exhibit 23. Acceptance of tenders for Treasury bills dated July 3, 1934,
and maturing January 2, 1935
Exhibit 24. Summary of information contained in press releases issued in
connection with Treasury bills offered during the fiscal year 1935

228
229
229

Issues and Redemptions of Bonds of Government Agencies Guaranteed as to
Interest and Principal by the United States
Exhibit 25. Inviting tenders for Federal Farm Mortgage Corporation
3-percent bonds of 1944-49
Exhibit 26. Acceptance of tenders for Federal Farm Mortgage Corporation bonds of 1944-49
.._.:
Exhibit 27. Inviting tenders for Home Owners' Loan Corporation bonds,
series C, 1936 (1)4 percent), series D, 1937 (1% percent), and series E,
1938 (2 percent)
.
Exhibit 28. Acceptance of tenders for Home Owners' Loan Corporation
bonds, series C, 1936; series D, 1937; and series E, 1938
...
iExhibit 29. Offering of Home Owners' Loan Corporation IJ^-percent
bonds of series F-1939
Exhibit 30. Allotments on exchange subscriptions, Home Owners' Loan
Corporation bonds of series F-1939
Miscellaneous
Exhibit 31. An act to amend the Second Liberty Bond Act, as amended,
and for other purposes
.o
Exhibit 32. Statement for the press, January 21, 1935, giving an explanation of the bill to amend the Second Liberty Bond Act
Exhibit 33. Regulations governing United States Savings Bonds
Exhibit 34. Amendment to Department Circular No. 418, as amended
May 3, 1934, governing the sale and issue of Treasury bills
Exhibit 35. Supplement, dated June 25, 1935, to Department Circular
No. 300, July 31, 1923, prescribing regulations governing United States
bonds and transactions with the Treasury Department
Exhibit 36. Statutes relating to lost, stolen, destroyed, mutilated, and
defaced bonds and notes
Exhibit 37. Press release, September 25, 1934, respecting the guarantee
of bonds of the Federal Farm Mortgage Corporation and the Home
Owners' Loan Corporation

232
234
234
236
236
242

243
245
246
251
252
253
255

MONEY

Exhibit 38. Proclamations and orders relating to silver
Exhibit 39. Statements and official orders relating to the issue of silver
cer tificates
Exhibit 40. Statement by the Secretary of the Treasury, February 11,
1935, relating to the stabilization fund
Exhibit 41. Proclamation, February 14, 1935, extending for 2 years the
period within which the Federal Reserve Board may authorize the
Federal Reserve banks to offer, and the Federal Reserve agents to
accept, direct obligations of the United States as collateral security for
Federal Reserve notes
J:

256
262
265

265

VIII

CONTENTS
TAXATION

Exhibit 42. An act to amend certain provisions relating to publicity of
certain statements of income, approved AprU 19, 1935
Exhibit 43. Joint resolution to provide revenue, and for other purposes,
approved June 28, 1935
Exhibit 44. Processing tax rates under the Agricultural Adjustment Act,
and rates of tax on cotton ginning and tobacco sales, to June 30, 1935,
with effective dates

Page
266
266
267

OBLIGATIONS OF FOREIGN GOVERNMENTS

Exhibit 45. Statements by the Treasury Department concerning the
indebtedness of certain foreign governments to the United States
Exhibit 46. Correspondence exchanged between the Government of the
United States and various foreign governments concerning foreign
debts owing to the United States

269
271

GOVERNMENT DEPOSITS

Exhibit 47. Instructions for collecting agents regarding the receipt of
postal money orders drawn on points outside the district in which
received
_^
Exhibit 48. Supplement to regulations governing deposit of public moneys
and payment of Government checks and warrants

278
279

ORGANIZATION CHANGES

Exhibit 49. Orders changing organization and procedure in the Treasury
Department. .
Exhibit 50. Supervision of bureaus, offices, and divisions of the Treasury
Department.

279
281

MISCELLANEOUS

Exhibit 51. Executive Order No. 6869, October 10, 1934, requiring certain
financial statements to be furnished the Secretary of the Treasury
Exhibit 52. Regulations No. 1—Administrative procedure for the maintenance of the system of accounts and disbursements under the Emergency Relief Appropriation Act of 1935, established pursuant to section
II (A) of Executive Order No. 7034
Exhibit 53. Executive Order No. 6981, March 2, 1935, removing, in certain cases, restrictions imposed by Public Resolution 53, of June 27,
1934, as to payments, transfers, and deliveries of property under the
Trading with the Enemy Act and the Settlement of War Claims Act
of 1928
Exhibit 54. Letter of the Acting Postmaster General to the Secretary of the
Treasury, dated November 26, 1935, certifying extraordinary expenditures contributing to the deficiency of postal revenues for the fiscal year
1935, in pursuance of Public Act No. 316, Seventy-first Congress,
approved June 9, 1930 (40 Stat. 523)

282

283

288

289

TABLES
Explanation of bases used in tables
^
Description of accounts through which Treasury operations are effected__

293
294

RECEIPTS AND EXPENDITURES

General Tahles
Table 1. Details of receipts, by sources and accounts, for the fiscal year
1935 (warrants and daily statement bases)
:
Table 2. Details of expenditures, by organization units and accounts,
for the fiscal year 1935 (checks-issued and daily statement bases)
Table 3. Receipts, expenditures, and surplus or defioit for the fiscal years
1932 to 1935 (daily statement basis)..
Table 4. Receipts and expenditures for the fiscal years 1789 to 1935
(warrant and daily statement bases)

296
302
316
320

CONTENTS
Table 5. Summary of receipts and expenditures, and excess of receipts or
expenditures, by months, for the fiscal year 1935 (daily statement
basis)
.
*.
Table 6. Expenditures, by months, classified according to organization
units, for the fiscal year 1935 (daily staternent basis)

IX
Page
328
329

Specific Receipts and Expenditures
Table 7. Comparison of detailed internal revenue collections for the fiscal
years 1934 and 1935 (collection basis)..^
Table" 8. Internal revenue receipts, by tax sources, for the fiscal years
1916 to 1935 (collection basis)
Table 9. Internal revenue receipts, by States and Territories, for the
fiscal year 1935 (collection basis)
Table 10. Expenses of the Internal Revenue Service for the fiscal year
1935 (checks-issued basis)
Table 11. Customs duties (estimated), value of imports entered for consumption, and ratio of duties to value of dutiable imports and to value
of all imports, for the calendar years 1923 to 1934 (on basis of reports of
the Bureau of Foreign and Domestic Commerce)
Table 12. Customs duties (estimated), value of dutiable imports, and
ratio of duties to value of dutiable imports, by tariff schedules, for the
calendar years 1923 to 1934 (on basis of reports of the Bureau of Foreign
and Domestic Commerce)
:
.
Table 13. Customs receipts, expenditures, and entries, by districts, fiscal
year 1935 (collection basis)
Table 14. Panama Canal receipts and expenditures for the fiscal years
1903 to 1935 (warrant basis)
.

341
343
345
347

352

353
355
356

Estimates of Receipts
Table 15. Actual receipts for the fiscal year 1935 and estimated receipts
for the fiscal years 1936 and 1937, by sources

357

PUBLIC DEBT

Public Debt Outstanding
Table 16. Public debt outstanding June 30, 1935, by issues (revised
daily statement basis)
Table 17. Description of the public debt issues outstanding June 30,
1935 (revised daily statement basis)
Table 18. Interest-bearing debt outstanding June 30, 1935, classified
according to kind of security and callable period or payable date (revised
daily statement basis)_:
...
Table 19. Principal of the public debt outstanding at the end of each
fiscal year from 1853 to 1935 (revised daily statement basis)
...

364
368
377
378

Public Debt Operations
Table 20. Public debt retirements chargeable against ordinary receipts
during the fiscal year 1935, and cumulative totals to June 30, 1934
and 1935, by sources and issues (revised daily statement basis)
Table 21. Summary of transactions in interest-bearing and noninterestbearing securities during the fiscal year 1935 (revised daily statement
basis)
.
Table 22. Summary of transactions in interest-bearing securities, by
form of issue, during the fiscal year 1935 (revised daily statement
basis)
Table 23. Changes in interest-bearing debt, by issues, during the fiscal
year 1935 (revised daily statement basis) _^
.
Table 24. Transactions in noninterest-bearing securities, by issues, during
the fiscal year 1935 (revised daily statement basis)
Table 25. Issues, maturities, and redemptions of interest-bearing securities,
exclusive of trust account and other special issues, July 1934 through
June 1935
._
_.
Table 26. Sources of public debt increase or decrease for the fiscal years
1915 to 1935 (daily statement basis)
Table 27. Transactions on account of the cumulative sinking fund during
the fiscal year 1935 (revised daily statement basis)

380
382
384
385
389
394
397
398

CONTENTS

Table 28. Transactions on account of the cumulative sinking fund for the
fiscal years 1921 to 1935 (revised daily statement basis)
Table 29. Securities retired through the^ cumulative sinking fund, par
amount and principal cost, to June 30, 1935 (revised daily statement
basis)

Page
399
399

Interest on ihe Public Deht
Table 30. Interest on the public debt payable, paid, and outstanding
unpaid, for the fiscal year 1935 (revised daily statement basis)
'Table 31. Interest paid on the public debt, by issues, for the fiscal years
1933 to 1935 (warrant basis)
Table 32. Amount qf interest-bearing debt outstanding, the computed an-'
nual interest charge, and the computed rate of interest, for the fiscal
years 1916 to 1935, and by months from July 1929 tp June 1935 (revised
daily statement basis)

400
400

401

Contingent Liabilities
Table 33. Contingent liabilities of the United States, June 30, 1935

403

CONDITION OF THE TREASURY EXCLUSIVE OF PUBLIC DEBT LIABILITIES

Table 34. Current assets and liabilities of the Treasury at the close of the
fiscal years 1933, 1934, and 1935 (revised daily statement basis)
Table 35. Net balance in the General Fund of the Treasury at the end of
each month, fiscal year 1935 (daily statement basis)
Table 36. Securities owned by the United States Government, June 30,
1935.
.r.

406
407
408

ASSETS AND LIABILITIES OP GOVEIINMENTAL CORPORATIONS AND AGENCIES

Table 37. Combined statement of assets and liabilities of governmental
corporations and credit agericies df the United States, as of June 30,
1935
.

411

STOCK AND CIRCULATION OF MONEY IN THE UNITED STATES

Table 38. Stock of money, money in the Treasury, in the Federal Reserve
banks, and in circulation, June 30, 1913 to 1935
:
Table 39. Stock of money, by kinds, at the eiid of each fis\jal year from
1913 to 1935
.
-_
Table 40. Money in circulation, by kinds, at the end of each fiscal year
from 1913 to 1935
.
.
Table 41. Stock of money, money in the Treasury, in the Federal Reserve
banks, and in circulation, by kinds, June 30, 1935
MISCELLANEOUS

Table 42. Principal of the funded and unfunded indebtedness of foreign
governments to the United States, the accrued and unpaid interest thereon, and payments on account of principal and interest, as of November
15, 1935
Table 43. Estimated amount of securities outstanding interest on which is
wholly or partially exempt from the Federal income tax, June 30, 1913 to
1935, by type of obligor
Table 44. Estimated amount of securities outstanding interest on which
is wholly exempt from normal income tax and surtax of the Federal
Government, June 30, 1913 to 1935, by type of obligor
—
Table 45. Amount of securities outstanding interest on which is exempt
from normal income tax, but not surtax, of the Federal Government,
June 30, 1918 to 1935, by direct obligor
Table 46. United States Government direct obligations held by Federal
Reserve banks, classified by the degree of exemption of the interest
thereon from the Federal income tax, June 30, 1915 to 1935
Table 47. Net expenditures for Federal aid to States, fiscal years 1920,
1934, and 1935, and amounts appropriated for 1936, by appropriations.
Table 48. Expenditures made by the Government as direct payments to
States during the fiscal year 1935- :
^

418
420
421
422
^

423
424
425
427
428
429
432

CONTENTS

PERSONNEL

Table 49. Number of employees in the departmental service of the Treasury in Washington, by months, June 1934 to June 1935
Table 50. Number of employees in the departmental and .field services of
the Treasury, June 1934 and June 1935
Table 51. Number of persons retired, and number of persons eligible for
retirement retained, departmental and field services of the Treasury,
August 20, 1920, to June 30, 1935...
Index-.-

Page
436
437
437
439

SECRETARIES, UNDER SECRETARIES, AND ASSISTANT SECRETARIES
OF THE TREASURY DEPARTMENT DURING THE FISCAL YEARS
1934 AND 1935 ^ AND THE PRESIDENT UNDER WHOM THEY SERVED
Term of service
Official
From—

To-

Mar. 4,1933
Jan. 1,1934

Dec. 31,1933

William H. Woodin, New York...
Henry Morgenthau, Jr., New York.

May 19,1933
Nov. 17,1933
May 2,1934

Nov. 16,1933
Dec. 31,1933

Dean G. Acheson, Maryland
Henry Morgenthau, Jr.,New York
Thomas Jefferson Coolidge, Massachusetts.

Secretary of the
Treasury

President

Secretaries ofthe Treasury
Roosevelt.
Roosevelt.

Under Secretaries
Woodin
Woodin
Morgenthau-

Roosevelt.
Roosevelt.
Roosevelt.

Woodin, Morgenthau..
Woodin, Morgenthau..
Woodin
Morgenthau

Roosevelt.
Roosevelt.
Roosevelt.
Roosevelt.

Assistant Secretaries
Apr. 18,1933
June 6,1933
June 12,1933
Dec. 1,1934

Dec. 12,1933

Lawrence W. Robert, Jr., Oeorgia.
Stephen B. Gibbons, New York...
Thomas Hewes, Connecticut
Josephine Roche, Colorado

1 For officials since 1789 see Annual Report for 1932, pp. xvii to xxi, and corresponding table in Annual
Report for 1933.

PRINCIPAL ADMINISTRATIVE AND STAFF OFFICERS OF THE
TREASURY DEPARTMENT AS OF NOVEMBER 15, 1935
OFFICE OF T H E SECRETARY
Henry Morgenthau, Jr
T. J, Coolidge...
Lawrence W, Robert, Jr
Stephen B, Gibbons
Josephine Roche..
Herbert E, Gaston
Peter Grimm
Daniel W. Bell
LeRoy Barton
Cyril B. U p h a m . . .
Harold N. Graves
Henrietta S. Klotz
John Kieley
Archie Lochhead
Beriah M. Thompson
Chester T. Crowell
Eugene Sloan
Harold Riegelman
James W. Bryan.
Edwin B, Fussell
William H, McReynolds
W. N. Thompson
Charles R. Schoeneman
Harris F. Mires
Edwin R. Ballinger
Lucius Wilmerding, Jr
H. R. Sheppard
Francis C. Rose
Mary E. Switzer
W. C. Cram, Jr.
F. A. Birgfeld
W. H. Moran
L. C. Spangler
James E. Harper
Gabrielle E. Forbush

Secretary of the Treasury,
Under Secretary of the Treasury.
Assistant Secretary of the Treasury.
Assistant Secretary of the Treasury.
Assistant Secretary of the Treasury.
Assistant to the Secretary,
Assistant to the Secretary,
Assistant to the Secretary.
Assistant to the Secretary.
Assistant to the Secretary.
Assistant to the Secretary.
Assistant to the Secretary.
Assistant to the Secretary.
Technical Assistant to the Secretary.
Special Assistant to the Secretary.
Special Assistant to the Secretary.
Sp ecial Assistant to the Secretary.
Special Assistant Counsel.
Consulting Expert.
Consulting Expert,
Administrative Assistant to the Secretary.
Assistant Administrative Assistant to the Secretary.
Special Staff Assistant.
Technical Assistant.
Technical Assistant.
Technical Assistant to Mr. Grimm.
Assistant to Assistant Secretary.
Assistant to Assistant Secretary.
Assistant to Assistant Secretary.
Technical Adviser.
Chief Clerk and Superintendent.
Chief, Secret Service Division.
Chief, Division of Printing.
Chief, Division of Appointments.
Chief, Correspondence Division.

OFFICE OF T H E G E N E R A L COUNSEL
Herman Oliphant
John G. Harlan
Clarence V. Opper...
Alanson Willcox
Clinton M. Hester
C. E. Turney
Robert H. Jackson
Eli Frank, Jr

General Counsel.
Assistant to the General Counsel.
Assistant General Counsel.
Assistant General Counsel.
Assistant General Counsel.
Assistant General Counsel.
Assistant General Counsel, Bureau of Internal Revenue.
Chief Counsel, Bureau of Customs.

OFFICE OF T H E DIRECTOR OF RESEARCH AND STATISTICS
George C. Haas
Lawrence H. Seltzer
A. S. McLeod
Harry D. White
Russell R. Reagh
Aaron Director

Director.
Assistant
Assistant
Assistant
Assistant
Assistant

to the D irector.
to the Director.
to the Director.
to the Director (Government Actuary).
to the Director.

PUBLIC D E B T SERVICE
William S. Broughton
Edwin L. Kilby
Rene W. Barr
W. W. Durbin
Byrd Leavell
Marvin Wesley
Melvin R. Loafman
Maurice A. Emerson

Commissioner ofthe Public Debt.
Assistant Commissioner of the Public Debt.
Deputy Commissioner of the Public Debt.
Register of the Treasury.
Assistant Register of the Treasury.
Chief, Division of Loans and Currency.
Chief, Division of Accounts and Audit.
Chief, Division of Paper Custody.
BUREAU OF ENGRAVING AND P R I N T I N G

Alvin W. Hall
Clark R, Long
Jesse E, Swigart

Director of the Bureau of Engraving and Printing.
Assistant Director (Administration).
Assistant Director (Production).

OFFICE OF T H E COMMISSIONER OF ACCOUNTS AND DEPOSITS
Edward F, Bartelt
Maurice Collins
William T. Heffelfinger
Guy F, Allen
Joseph Greenberg
Edward D. Batchelder
Harry R. Schwalm
XIV

Commissioner of Accounts and Deposits.
Assistant Commissioner of Accounts and Deposits.
Assistant to the Commissioner.
Chief Disbursing Officer, Division of Disbursement,
Chief, Division of Bookkeeping and Warrants.
Chief, Division of Deposits.
Chief Examiner, Section of Surety Bonds.

XV
OFFICE OF THE COMPTROLLER OF THE CURRENCY
J. F. T. O'Connor...
F. G. Await.
Eugene H. Gough
Gibbs Lyons...W. P. Folger
J, E, Fouts
George R. Marble

Comptroller ofthe Currency.
Deputy Comptroller.
Deputy Comptroller.
Deputy Comptroller.
Chief National Bank Examiner.
Supervising Receiver, Insolvent National Bank Division,
Chief Clerk.

.--

OFFICE OF T H E TREASURER OF T H E U N I T E D STATES
William A. Julian
Marion Banister
George 0. Barnes
Louis P. Allen...

Treasurer ofthe United !
Assistant Treasurer.
Executive Assistant to the Treasurer.
Chief Clerk.
BUREAU OF NARCOTICS

Harry J, Anslinger

Commissioner of Narcotiiss,

Will S, Wood

Deputy Commissioner of Narcotics.
OFFICE OF T H E COMMISSIONER OF I N T E R N A L REVENUE

Guy T. Helvering
Wright Matthews
Charles T, Russell
George J, Schoeneman..
D. Spencer Bliss
Stewart Berkshire
Eldon P. King.
A. R. Marrs
Elmer L. Irey...
Bertha Wetherton

Commissioner of Internal Revenue,
Assistant to the Commissioner.
Deputy Commissioner.
Deputy Commissioner.
Deputy Commissioner.
Deputy Commissioner.
Special Deputy Commissioner.
Head, Technical Staff.
Chief, Intelligence Unit.
Special Assistant to the Commissioner.
F E D E R A L ALCOHOL ADMINISTRATION

Franklin C. Hoyt
Harris E. Willlngham...
John E. O'Neill
John L. Huntington.
John F. Moore

Federal Alcohol Administrator.
Associate Administrator.
Deputy Administrator.
Deputy Administrator.
Acting General Counsel.

BUREAU OF CUSTOMS
James H. Moyle
Frank Dow
Thomas J. (lorman

---

Commissioner of Customs.
Assistant Commissioner of Customs.
Deputy Commissioner, Customs Agency Service.
M I N T BUREAU

Nellie Tayloe Ross
Mary M. O'Reilly

Director of the Mint.
Assistant Director.

(
Hugh S. Cumming
W. F. Draper.
_.
L. R. Thompson
Francis A. Carmelia. _
Walter L. TreadwayC. E. Waller-S. L. Christian
Ralph C. Williams
R. A. Vonderlehr
D. S. Masterson
Rear Admiral H. G. Hamlet
Capt. Leon C. Covell
Comdr, Russell R. Waesche
A. T. Thorson
Oliver M. Maxam

PUBLIC H E A L T H SERVICE
_ Surgeon General.
Assistant Surgeon General.
-- Assistant Surgeon General.
Assistant Surgeon General.
Assistant Surgeon General.
. Assistant Surgeon General.
Assistant Surgeon General.
._ Assistant Surgeon General.
Assistant Surgeon General.
Chief Clerk and Administrative Officer.
U N I T E D STATES COAST GUARD
Commandant.
Assistant Commandant.
Head, Finance Division,
Budget Officer,
Technical Adviser to the Commandant.
P R O C U R E M E N T DIVISION

Rear Admiral C. J. Peoples.-W, E. Reynolds
Harry E. Collins
Leo C. Martin
_
Robert LeFevre
_
W, N. Rehlaender
Louis A. Simon
Neal A. Melick

Director of Procurement.
Assistant Director, Public Works Branch,
- Assistant Director, Supply Branch,
Assistant to Assistant Director, Public Works Branch.
Assistant to As.sistant Director, Supply Branch,
Administrative Assistant, Supply Branch.
Supervising Architect.
Supervising Engineer.

XVI
ADVISORY COMMITTEE ON ARCHITECTURAL DESIGN

Charles Z. Klauder, Chairman.
Aymar Embury II.

Louis A. Simon

Philip B, Maher.
Henry R. Shepley.

BOARD OF AWARDS

Neal A, Melick, Supervising Engineer, Chairman.
W. E. Reynolds, Assistant Director.
Louis A. Simon, Supervising Architect.
Nelson S. Thompson, Chief, Mechanical Engineering Section.

William K, Laws, Chief, Legal Section.
John H. Schaefer, Office Manager.
John Weber, Secretary.

STANDING DEPARTMENTAL COMMITTEES
B U D G E T AND I M P R O V E M E N T C O M M I T T E E
O. R. Schoeneman, Chairman.
F. A. Birgfeld, Vice Chairman.
W. N . Thompson.
D. S. Bliss.
L. C. Martin.
Edward F . Bartelt.
Harris F . Mires.

John H. Schaefer.
Arthur E. Wilson.
M. E. Slindee.
George 0 . Barnes.
Fred P. Trott.
Mary E. Switzer.
E. C. Nussear, Secretary.

C O M M I T T E E ON E N R O L L M E N T AND DISBARMENT OF ATTORNEYS AND AGENTS
Guy C. Hanna, Chairman.
W. W. Cook.

I. T. Gilruth.
C O M M I T T E E ON P E R S O N N E L

F. A. Birgfeld, Chairman.
James E. Harper.

(Vacant.)

C O M M I T T E E ON CIVIL SERVICE R E T I R E M E N T
F . A. Birgfeld, Chairman.
James E. Harper,

W. N . Thompson.
Frank Dow.

16816—36—2

ORGANIZATION OF T H E TREASURY DEPARTMENT, NOVEMBER 15, 1935

DEPARTMENT

THE

TREASURY

November 15. 1 9 3 5
SECRETARY
OF THE
TREASURY

JNDER
ADMINISTRATIV
ASSISTANT T O T

SECRETARV
A S S I S T A N T T O TH
StCBETARV
IN M A T T E R S OF
PUBLIC RELATION]

SPECIAL
TS TO THE

LEGAL

ASSISTANT SECRETARV
IH CHARGE.OF CUSTOMS.
C O A S T GUARD AND
NARCOTICS

DIVISION

ASSISTANT
IN CHARGE OF
PUBLIC HEALTH

BUREAU OF ENGAAVING

COMMISSIONER

DIVISION OP
T H E TREASURY

SECRETARY'S
CORRESPONDENCE
DIVISION

OFFICE OF T H E
HEASUB6R OP THI
UNITED STATES

O F P I C E O F THE
C O M P T R O L L E R OF
THE C O R R E N C y

DIVISION OF RESEARCH

DIVISION OF
PUBLIC DEBT
ACCOUNTS ANO AUO

GOVERNMENT ACTUARY

I
I
I

COMMISSIONER
OF ACCOUNTS
AND D E P O S I T S

DIVISION OF
B00HREEPIN8
AND WARRANTS

DISBURSEMKtn

CHART l

ANNUAL REPORT ON THE FINANCES
TREASURY DEPARTMENT,

Washington, D. (7., November 20, 19S5.
SIR: I have the honor to make the following report:
BUDGET RESULTS

Receipts
Total receipts of general and special funds during the fiscal year
1935 were $3,800,500,000, as compared with $3,115,600,000 in 1934,
RECEIPTS OF GENERAL AND SPECIAL FUNDS. FISCAL YEARS 1926 TO 1935, BY PRINCIPAL
SOURCES

1926

1927

1928

1929

1930

1931

1932

1933

1934

1935

CHART 2.

an increase of $684,900,000. Income taxes, miscellaneous internal
Tevenue, agricultural adjustment taxes, customs, and seigniorage on
silver all showed substantial increases.
The trend in receipts by major sources, from 1926 to 1935, inclusive,
is shown in the chart above. A more detailed comparison of receipts
for 1934 and 1935 is presented in the table on page 2.

REPORT OF THE SECRETARY OP THE TREASURY

Income tax receipts, wliich were 26 percent of total receipts in
1934, increased to 29 percent of total receipts in 1935. Miscellaneous internal revenue, though showing a substantial absolute
increase in 1935, declined in relation to total receipts from 47 percent
in 1934 to 43 percent in 1935.
Receipts by major sources for ihe fiscal years 1934 and 1935 *
[In millions of dollarsi
1934

Internal revenue:
I n c o m e taxes:
C u r r e n t corporation
Current individual Back taxes

-..

T o t a l income taxes (collection basis).A d j u s t m e n t to daily T r e a s u r y s t a t e m e n t basis (unrevised)
T o t a l income taxes
Miscellaneous internal r e v e n u e taxes:
Excess-profits
C a p i t a l stock
Estate
...
..
.
Gift
Distilled spirits a n d wines (including special taxes)
F e r m e n t e d m a l t liquors (including special taxes)
Tobacco
Stamp...

.
..

M a n u f a c t u r e r s ' excise:
Gasoline
A u t o m o b i l e s , t r u c k s , tires, tubes a n d p a r t s or accessories..
Electrical energy
L u b r i c a t i n g oils
All o t h e r
T o t a l m a n u f a c t u r e r s ' excise

T e l e g r a p h , telephone, r a d i o , a n d cable
T r a n s p o r t a t i o n of oil b y pipe line
Checks
Admissions
_.
Coconut, etc., oils processed
. .
All other miscellaneous internal r e v e n u e

T o t a l miscellaneous internal r e v e n u e (collection basis)
A d j u s t m e n t to daily T r e a s u r y s t a t e m e n t basis (unrevised)
T o t a l miscellaneous i n t e r n a l r e v e n u e .
Agricultural a d j u s t m e n t taxes
Total internal revenue
Customs

_
.•

Total internal revenue a n d customs
Miscellaneous receipts:
Proceeds of G o v e r n m e n t - o w n e d securities:
Foreign obligations.
All other
.
.
Seigniorage 3
All other miscellaneous receipts
.
T o t a l miscellaneous receipts
T o t a l receipts, general a n d special funds

1935

Increase ( + ) ,
decrease (—)

32L4
355.0
140.6

465.4
448.2
185.6

+144,0
+93.2
+45.0

817.0
+1,0

1, 099. 2
-.1

+282.2
-1.1

818.0

1,099.1

+281.1

2.6
80.2
104.0
9.2
90.0
169.0
425.2
66.6

6.6
9L5
140.4
7L7
195.4
215.6
459.2
43.1

+4.0
+11.3
+36.4
+62.6
+105.4
+46,6
+34,0
-23. 5

202.6
70.9
33.1
25.3
58.1

161. 5
77.3
32.6
27.8
43.1

-41.1
+6.4
-.5
+2.5
-15,0

390.0

342.3

-47.7

19.3
. 10.4
4L4
]4.6
2 61,3

19.7
9.5
26,6
15.4
24,5
13.5

+24.5
-47,8

1,483.8
-14.2

1,674. 0
-16.8

+190. 2
-2.6

1,469. 6

1,657. 2

+187.6

353.1

521. 4

+168, 3

2, 640. 7
313.4

3, 277, 7
343.4

+637.0
+30.0

2,954.1

3, 621.1

+667. 0

- 20.4
57.4
.5
83.2

.7
38.1
58.0
82.6

-19.7
-19.3
+57.5
-.6

+.4
-.9
-15,8

+.8

161.5

179.4

+17.9

3,115. 6

3,800.5

+684.9

1 Income taxe." and miscellaneous internal revenue taxes on the basis of collections, with totals adjusted
to basis nf daily Treasury statement (unrevised); agricultural adjustment taxes, customs, and miscellaneous
receipts on basis of daily Treasury statement (unrevised). General and special accounts combined. For
description of accoun rs and bases, see p. 293.
'Includes $50.2 million from tax on dividends, terminated Dec. 31,1933.
3 See footnote on o. 6.

REPORT OE THE SECRETARY OF THE TREASURY

Income taxes.—In the fiscal year 1935 income tax receipts aggregated $1,099,100,000 as compared with $818,000,000 in the fiscal
year 1934, an increase of $281,100,000. Eeceipts during the first
half of the fiscal year 1935 were based largely on incomes for the
calendar year 1933, and receipts during the second half, on incomes
reported for the calendar year 1934. Receipts during the second
half, therefore, refiected the higher levels of corporate and individual
incomes during the calendar year 1934 as compared with 1933, as weU
as the changed provisions contained in the Revenue Act of 1934,
which then became effective for the first time.
Collections of current corporation income taxes increased $144,000,000 in 1935 over the preceding year, about 62 percent of this
increase occurring in the second half of the fiscal year. Among
the changed provisions in the Revenue Act of 1934 affecting corporation income tax collections were the elimination of consolidated
returns (except for railroad corporations), the imposition of a surtax
on personal holding companies, and new provisions with regard to
reorganizations. In addition, the Treasury changed its administration of depreciation allowances. The last-named factor, together with
the special efforts of the Bureau of Internal Revenue to collect back
taxes on incomes, resulted in an increase of collections of $45,000,000
during the fiscal year 1935.
Approximately 79 percent of the increase of $93,200,000 in current
individual income taxes during thefiscalyear 1935 was collected during
the second half of the fiscal year and reflected, in addition to the
higher level of individual incomes in 1934 as compared with 1933, the
net effect of changes in the rate structure and in the capital gains
and losses provisions incorporated in the Revenue Act of 1934.
Miscellaneous internal revenue.—Receipts from miscellaneous internal revenue taxes were $1,657,200,000 in the fiscal year 1935,
as compared with $1,469,600,000 in 1934, an increase of $187,600,000.
Collections from the leading revenue-producing taxes of this class are
shown in the table on page 2.
In 1935 approximately 86 percent of the total miscellaneous internal revenue collections came from the following sources, which are
arranged in the order of their revenue-producing importance: Tobacco taxes, manufacturers' excise taxes, taxes on fermented malt
liquors, taxes on distilled spirits and wines, the estate tax, and the
capital stock tax.
Increased revenue was obtained from taxes on distilled spirits and
wines, gifts, fermented malt hquor, estates, and tobacco. These increases more than offset declines in the collections from manufacturers' excise taxes, documentary stamp taxes, and certain other
miscellaneous internal revenue taxes.

REPORT OP THE SECRETARY OP T H E TREASURY

The increased rates of tax on estates imposed by the Revenue Act
of 1934 were not reflected to any marked extent in collections until
Ma}'' 1935, since under that act returns were not required to be flled
until one year after the death of the decedent. The increase of $36,400,000 in collections from the estate tax was caused mainly by the
increase in the, taxable value of estates of decedents in the year ended
June 30, 1934. Collections from the gift tax increased by $62,500,000
to $71,700,000 in 1935. This increase was due more to the larger
amount of gifts—probably made, at least in part, in anticipation of
higher income and estate taxes—than to the higher rates of gift
tax under the Revenue Act of 1934, applicable to gifts made during
the calendar year 1935.
CoUections from the tax on tobacco manufactures increased
$34,000,000 in 1935 to a new high level of $459,200,000. As in other
recent years this was the result of increased consumption of cigarettes.
Nineteen hundred and thirty-five was the first full fiscal year during
which the repeal of the eighteenth amendment was effective. This
factor, together with an increase in the consumption of tax-paid
distilled spirits and wines, accounted for a $105,400,000 increase
in revenue from this source. Increased consumption of fermented
malt liquor resulted in additional revenue of $46,600,000. Total
revenue of $411,000,000 from liquor taxes for the fiscal year 1935
exceeded that for any year in the pre-prohibition period except 1918
and 1919.
The decline of $47,700,000 in revenue from manufacturers' excise
taxes in the fiscal year 1935 was in most part due to the decline in
collections from the tax on gasoline. During part of the preceding
fiscal year the 1}^ cents per gallon rate imposed by the National Industrial Recovery Act was in effect, whereas during the whole of
1935 the rate was 1 cent per gallon. The repeal of taxes on candy
and soft drinks and the modification of taxes on furs and jewelry
also contributed to the loss of revenue from manufacturers' excise
taxes.
Collections from the capital stock tax and excess-profits tax increased, and new taxes imposed by the Revenue Act of 1934 on the
processing of coconut and other oils gave rise to substantial revenue.
The expiration, however, of the tax on dividends, effective December
31, 1933, and of the tax on checks, effective January 1, 1935, resulted
in reduced collections from those sources. A decline in revenue from
documentary stamp taxes was in large part due to the lower revenue
from taxes on stock transfers, reflecting a contraction in the volume
of stock trading. Another factor contributing to the dechne was the
reduction, in the Revenue Act of 1934, of the stamp tax on sales of
produce for future deUvery from 5 cents per $100 to 3 cents per $100.

REPORT OP THE SECRETARY OP THE TREASURY

Agricultural adjustment taxes.—Receipts from agricultural adjustment taxes totaled $521,400,000 in 1935, an increase of $168,300,000
over receipts from this source in the fiscal year 1934. This increase
was due mainly to the fact that none of these taxes was in effect
during all of 1934 and for some commodities only during a small part
of the year. Processing and related taxes on peanuts and rice and
the cotton ginning and tobacco sales taxes did not become effective
until the fiscal year 1935.
Collections of processing and related taxes combined were higher
in 1935 for all commodities represented in both years except for
cotton and paper and jute products. By far the largest increases
occurred in the cases of hogs, on which the tax became effective
November 5, 1933, and the last increase in rate, March 1, 1934, and
of sugar beets and sugar cane, on which taxes did not become effective
until June 8, 1934. Receipts from taxes on hogs, wheat, and cotton
accounted for 77 percent of total collections of agricultural adjustment taxes during-the fiscal year 1935. For a further discussion of
agricultural adjustment taxes, see page 30.
(7i^s^oms.—Customs receipts in the fiscal year 1935 amounted 4o
$343,400,000, or $30,000,000 more than in the fiscal year 1934. The
additional revenue from customs resulted from an increase in imports
of distilled spirits and wines and from a relatively large volume of
imports of agricultural products.
Miscellaneous receipts.—Miscellaneous receipts of general and
special funds increased from $161,500,000 in the fiscal year 1934 to
$179,400,000 in 1935. These receipts include such items as proceeds
from Government-owned securities, Panama Canal tolls, seigniorage,
tax on the circulation of national bank notes, fees, fines and penalties,
rents and royalties, and sales of Government property. An increase
of $57,500,000 ^ in receipts from seigniorage more than offset decreases
in certain other sources of misceUaneous receipts.
Expenditures
Total expenditures for general and special (including recovery
and relief) accounts amounted to $7,375,800,000 for the fiscal
year 1935, as compared with $7,105,000,000 in i934, an increase of
$270,800,000. The trend in total expenditures and in the principal
classes of expenditures for the fiscal years 1926 to 1935 is shown in the
chart on page 6. A comparison of expenditures on a functional basis
for the fiscal years 1934 and 1935 appears in the table beginning on
page 7, and another classification of expenditures for the two years
is given in the table beginning on page 10.
1 This amount is exclusive of $140,100,000 held as a trust account, etc., receipt, representing seigniorage
taken on silver acquired under the Silver Purchase Act of 1934 and received under the President's proclamation dated Aug. 9,1934. See exhibit 38, page 256.

REPORT OP THE SECRETARY OP THE TREASURY

Expenditures for 1934 and 1935 shown on the chart as ''Recovery
and relief" are not strictly comparable with such expenditures for the
fiscal years 1932 and 1933. For 1932 and 1933 these expenditures
include only those made from funds of the Reconstruction Finance
Corporation and subscription to stock of the Federal land banks.
Other expenditures in 1932 and 1933 traceable to the economic depression and all such expenditures in earlier years were made from
EXPENDITURES FOR GENERAL AND SPECIAL (INCLUDING RECOVERY AND RELIEF)
ACCOUNTS. FISCAL YEARS 1926 TO 1935, BY PRINCIPAL CLASSES

1930

1931

1932

1933

1935

CHART 3.

regular appropriations and general Treasury accounts. Recovery
and relief expenditures for 1934 and 1935 shown in both the chart and
the table on page 7 include those classified as emergency expenditures in the daily Treasury statements of those years and also general
expenditures for the Agricultural Adjustment Administration, refunds of processing taxes on farm products, and subscription to stock
of Federal land banks. The classification of expenditures on a
functional basis shown in that table follows the classification in compilations of the Bureau of the Budget.

EEPORT OF TPIE SECRETARY OF THE TREASUEY

Expenditures for the operation and maintenance of regular departments and establishments of the Government (exclusive of public
debt charges) aggregated $1,732,100,000 in 1935, an increase of
$26,800,000 over the preceding year. The principal items of increase
in this class of expenditure were: $53,900,000 for national defense, to
provide replacement and improvement of equipment for the Army and
to meet provisions of the naval treaties of 1922 and 1930; $49,000,000
for veterans' pensions and benefits, as the result of the application of
new laws or revised rules pertaining to service-connected disabUities;
and $12,000,000 on account of the postal deficit. These increases
were largely offset by a decrease of $50,200,000 in regular expenditures
for public buUdings, due to the completion of a major part of the
original public buUding program of 1926 for the District of Columbia,
and by lower expenditures for regular river and harbor works and for
refunds of customs and internal revenue receipts. Additional expenditures for some of these purposes were made from recovery and
relief funds and are shown as such.
Expenditures by major functions, fiscal years 1934 and 1935 ^
[In millions of dollars]
1934

Class of expenditure

Operation a n d m a i n t e n a n c e of regular d e p a r t m e n t s a n d e s t a b l i s h m e n t s :
Legislative, judicial, a n d executive
. Civil d e p a r t m e n t s a n d agencies 2
P u b l i c buildings 3
.".
_
__
_.
R i v e r a n d h a r b o r works 3
._
_
_
P o s t a l deficiency
N a t i o n a l defense 3
__
_._
V e t e r a n s ' pensions a n d benefits 3 .
.
Refunds of receipts, internal r e v e n u e a n d c u s t o m s
Aiiother
. .
T o t a l operation a n d m a i n t e n a n c e
P u b l i c d e b t charges:
Interest.
Retirements

. .

T o t a l p u b l i c d e b t charges
R e c o v e r y a n d relief:
Agricultural aid: *
Agricultural A d j u s t m e n t A d m i n i s t r a t i o n
Refunds of processing taxes
C o m m o d i t y C r e d i t Corporation
F a r m C r e d i t A d m i n i s t r a t i o n (including F e d e r a l F a r m M o r t g a g e
. Corporation) 6
Federal l a n d b a n k s
. .
T o t a l agricultural aid
Relief:
F e d e r a l E m e r g e n c y Relief A d m i n i s t r a t i o n (including
S u r p l u s Relief Corporation)
Civil W o r k s A d m i n i s t r a t i o n
E m e r g e n c y Conservation W o r k
..
D r o u g h t - s t r i c k e n areas ( D e p a r t m e n t of Agriculture)
T o t a l relief

Footnotes at end of table.

1935

Increase
(+)orde.
crea.se (—)

32.6
331.9
75.5
78.3
52.0
479. 7
556.6
62.7
36.0

35.7
333.3
25.3
55.1
64.0
533.6
605.6
45.2
34.3

+3,1
+1,4
-50.2
-23.2
+12. 0
+53.9
+49.0
-17.6
-1.7

1, 705. 3

1, 732.1

+26. 8

756.6
359.9

820.9
573.6

+64.3
+213.7

1,116.5

1, 394. 5

+278. 0

289.1
L2
183.1

711.8
31.2
8 60.1

+422, 7
+30.0
-243, 2

346.3
46.2

141.4
- 48. 0

-204.9
+L8

*865.9

<872.3

+6,4

707. 4 '
805.1
331.9

1,814. 3
11.3
435.5
80.6

+1,106.9
-793,8
+103, 6
+80.6

1, 844. 4

2, 341. 7

+497,3

Federal

REPORT OP THE SECRETARY OP THE TREASURY
Expenditures by major functions, fiscal years 1934 and 1935 ^—Continued
Class of expenditure

Recovery and relief—Continued.
Public Works:
Administrative expenses, Public Works Administration..
Boulder Canyon project
L.I
..'
„....
Loans and grants to States, mumcipaiities, etc
Loans to railroads
Public highways
River and harbor works
National defense
Other public works
Total public works..
Aid to home owners:
Home loan system
Emergency housing
Federal Housing Administration.
Resettlement Administration
Subsistence homesteads
Total aid to home owners
Reconstruction Finance Corporation, direct loans and expenditures..
Tennessee Valley Authority
Miscellaneous:
Expott-irhport Banks of Washington
Federal Deposit Insurance Corporation..
Administration for Industrial Recovery.
Unclassified items
Total miscellaneous
Total recovery and reliefTotal expenditures

1934

6,5
19,4
78,6
70,7
267,9
72.5
60,7
66.1

1935

14,6
23,8
137.7
66.2
317,4
147,9
176,3
136.6

2.3

+8,1
+4,4
+69.1
-4,5
+49,5
+75,4
+115, 6
+70,4
+378, 0

642.4

192.2
.4

Increase
(+) or decrease (—)

75.7
6.5
15.9
1.7
3.7

-110.5
+6,1
+16.9
+1.7
+1.4

194.9

103.5

-9L4

7 665.8

5 135. 4

-701. 2

ILO

36,2

+25.2

2,7
149,5

»2.6
,5
12,5
.1

-5.3
-149.0
+5.9

158.8

10,5

-148.3

+.1

4 4, 283. 2 M,249.2

-34.0

7, 375,8

+270.8

7,105. 0

1 On basis of daily Treasury statements (unrevised), partly reclassified on the basis of compilations ofthe
Bureau of the Budget. (See note 4 below.)
2 Operation and maintenance expenditures only, exclusive of expenditures for public buildings and public
works.
3 Additional expenditures for these accounts included under " Recovery and relief."
* Includes the following expenditures classified as general in the daily Treasury statements: Expenditures
for the Agricultural Adjustment Administration, refunds of processing taxes on farm products, and subscription to stock of Federal land banks,
5 Excess ofcredits-, deduct.
6 Additional expenditures for Farm Credit Administration included under Civil departments and
agencies, above.
7 Exclusive of $333,600,000 included under "Federal Emergency Relief Administration" and $18,800,000
under." Commodity Credit Corporation."

Public debt charges amounted to $1,39.4,500,000 in 1935, as compared with $1,116,500,000 in 1934, an increase of $278,000,000, of
which $213,700,000 represented larger statutory debt retirements,
and $64,300,000, increase in interest payments. The public debt and
expenditures on its account are discussed in detail on page 12.
Total expenditures for recovery and relief amounted to $4,249,200,000 in 1935, or $34,000,000 less than in 1934. This total is net,
after taking into consideration the earnings of and repayments of
loans.to certain agencies of the Government.
Expenditures for agricultural aid aggregated $872,300,000 in 1935,
an increase of $6,400,000 over 1934. Increases in rental and benefit
payments and in refunds of processing taxes arose chiefly because such
payments during 1934 were not made for the full fiscal year and also
because additional commodities were made a part of the program in
1935. This subject is analyzed in greater detaU on page 30. Due

REPORT OF THE SECRETARY OF THE TREASURY

largely to these increases, expenditures of the Agricultural Adjustment
Administration were $452,700,000 higher in 1935 than in 1934. This
increase was partly offset by net repayments of loans in excess of
expenditures of the Commodity Credit Corporation in the amount
of/$60,100,000, as against net expenditures of $183,100,000 in 1934.
Recovery and relief expenditures of the Farm Credit Administration
decreased $204,900,000, chiefly because of the expenditure in 1934 of
$199,900,000 of the $200,000,000 made avaUable to the Federal Farm
Mortgage Corporation by the Reconstruction Finance Corporation
under the act of May 12, 1933.
Total expenditures for relief amounted to $2,341,700,000 in 1935,
as compared with $1,844,400,000 in 1934, an increase of $497,300,000.
Expenditures for the Federal Emergency Relief Administration (including the Federal Surplus Relief Corporation) were $1,814,300,000
in 1935, an increase of $1,106,900,000 over 1934, chiefly as a result of
larger outlays for direct relief. To a large extent these outlays supplanted work relief through the Civil Works Administration, which
was nearly terminated by the end of the preceding year. Expenditures for the Civil Works Administration were $11,300,000 in 1935,
as compared with $805,100,000 in 1934. Owing to the drought in
the summer of 1934, loans and rehef expenditures made by the
Department of Agriculture in stricken agricultural areas amounted
to $80,600,000 in 1935.
Expenditures for emergency public works increased from $642,400,000 in 1934 to $1,020,400,000 in 1935, because of larger expenditures for loans and grants to States, municipalities, etc., for public
highways, river and harbor works, national defense, etc. Loans to
railroads showed a slight decrease.
Total aid to home owners declined $91,400,000 in 1935 owing to the
fact that expenditures for the purchase of capital stock of the Home
Owners' Loan Corporation amounted to $46,000,000 in 1935, compared with $153,000,000 in 1934. This decrease of $107,000,000 was
partly offset by expenditures of $15,900,000 by the Federal Housing
Administration, created under the act of June 27, 1934; of $1,700,000
for the Resettlement Administration, established by Executive order
on April 30, 1935; and of increased amounts for emergency housing
and subsistence homesteads.
Earnings and repayment of loans received by the Reconstruction
Finance Corporation in 1935 exceeded direct loans and expenditures
by the Corporation, resulting in net receipts of $135,400,000 as compared with net expenditures of $565,800,000 in 1934. Expenditures
for the Tennessee Valley Authority increased from $11,000,000 in
1934 to $36,200,000 in 1935, largely for construction in connection
with the water-control program.

REPORT OF THE SECRETARY OP THE TREASURY

Expenditures classifled as ''miscellaneous" decreased $148,300,000
in 1935, chiefly because the Treasury's purchase of $150,000,000 of
capital stock of the Federal Deposit Insurance Corporation, as
provided in the Banking Act of 1933, was practically completed in
the fiscal year 1934.
Expenditures for general and special accounts, including those for
recovery and relief, for the fiscal years 1934 and 1935 are shown also in
the table below, with recovery and relief expenditures separated into
two classes, nonrepayable and repayable.
Summary of expenditures, fiscal years 1934 and 1935
1934
General expenditures:
Departmental i
National defense *
Veterans' Administration i
Agricultural Adjustment Administration i...
Refunds of processing taxes
Postal deficiency
Subscription to stock of Federal land banks-.
Interest on the public debt
• Public debt retirements
^
All other
-

Total general expenditures
Recovery and relief expenditures (as shown below).
Total expenditures..
Recovery and relief expenditures:
Nonrepayable:
Grants, aids, and expenses:
Federal Emergency Relief Administration
Civil Works Administration
Emergency conservation work
Public Works Administration:
Administrative expenses..
Public bodies
Surplus Relief Corporation
Agricultural Adjustment Administration
Federal land banks (reduction in interest rates on
mortgages)
Reconstruction Finance Corporation.
Administration for Industrial Recovery
Department of Agriculture relief
Resettlement Administration
Rural Electrification Administration
Regional agricultural credit corporations
Total grants, aids, and expenses..
Federal public works projects:
Tennessee Valley .Authority
Public highways.
Rivers and harbors
Other:
Legislative establishment
State Department
Treasury Department:
Public building construction and sites.
All other
War Department (nonmilitary)
National defense:
Army
Navy
Footnotes at end of table.

$341,335, 354.16
479,694, 307.99
606,649, 454.14
279,723, 062. 38
1,194, 639.95
62, 003, 296. 62
a 1,737,780.00
766,617, 126. 73
369,864, 092,90
326, 670,980, 27

1935

$366,992,612.25
633, 697.243.04
666,573,274. 31
561,640,268.39
31,208,208.32
63,970,404,80
1,939,140. oa
820,926,363. 45
673,668,250, oa
222,928,98a 20

3,100,914,534,14
4,004,136,55a 81

3, 721, 234, 634. 76
3, 654,690, 530.81

7,105,060,084.95

7, 375,825,165. 57

667, 298,636. 98
805,122,892. 29
331,940,851.40

1,737,906,816. 44
11, 327, 263. 67
435, 508, 643. 05

6,539,'315.18
12,.273,186. 33
40,053, 808. 31
!.3 62, 799,128.10

14,561.002. 60
34.446,313.00
76, 570, 514. 43
3 221, 647, 44a 05

7,029,256. 79
< 20,456,63a 34
6,632,491. 49

12,477,674.95
< 21,897,084.04
12, 496, 73a 81
80,561,249.99
122,787. 39
16,820 93
8, 603.628.15

2,096,993. 26
»1,796,732,671.,

8 2, 624, 348,801.42

11,036,794,57
267,882,017, 66
72,450,381, 47

36,148,537. 34
317,356,940 05
147,924,751. 64

123,381. 60
747,170 01

486,103.10
2,659,016. 08

3,190,465.42
18,928,120. 22
775,477.97

32,756,840. 70
5,615,95L73
1,488,375. 48

38,023, 229. 37
22,640,904. 90

61,298,999.11
115,037,329.60

REPORT OF T H E SECRETARY OF T H E TEEASUEY

Summary of expenditures, fiscal years 1984 and 1985—Continued
1934

R e c o v e r y a n d relief e x p e n d i t u r e s — C o n t i n u e d .
Nonrepayable—Continued.
Federal public works projects—Continued.
P a n a m a Canal
D e p a r t m e n t of Justice
Post Office D e p a r t m e n t
Interior D e p a r t m e n t (exclusive of subsistence h o m e steads a n d Boulder C a n y o n project)
D e p a r t m e n t of Agriculture (exclusive of h i g h w a y s ) . .
D e p a r t m e n t of C o m m e r c e
D e p a r t m e n t of L a b o r
Veterans' Administration
I n d e p e n d e n t offices a n d commissions
. —
District of C o l u m b i a
Unclassified items
T o t a l Federal p u b l i c w o r k s projects..
Total nonrepayable
Repayable:
F e d e r a l p u b l i c w o r k s projects:
B o u l d e r C a n y o n project
O t h e r r e c l a m a t i o n projects..
Total Federal public works projects.
Loans:
C o m m o d i t y Credit Corporation
J o i n t stock l a n d b a n k s .
C r o p a n d feed loans, e t c . , ( F a r m Credit A d m i n i s t r a tion)..
Public Works Admimstration:
P u b l i c bodies
Railroads..
E m e r g e n c y housing
_
Federal H o u s i n g A d m i n i s t r a t i o n — .
Subsistence homesteads «._
R e s e t t l e m e n t administration..Reconstruction Finance Corporation.
E x p o r t - I m p o r t B a n k s of W a s h i n g t o n
Total loans.
Subscriptions t o capital stock, etc.:
P r o d u c t i o n credit corporations
_•
B a n k s for cooperatives
.-.
Regional agricultural credit c o r p o r a t i o n s - . .
Federal F a r m M o r t g a g e Corporation
Federal i n t e r m e d i a t e credit b a n k s
Federal l a n d b a n k s
H o m e loan b a n k s
H o m e O w n e r s ' L o a n Corporation
Federal savings a n d loan associations
Federal Deposit I n s u r a n c e C o r p o r a t i o n —
T o t a l subscriptions to capital stock, e t c . .
Total repayable
Total nonrepayable and repayable.
Reconciliation w i t h d a i l y T r e a s u r y s t a t e m e n t :
T o t a l n o n r e p a y a b l e a n d r e p a y a b l e (shown above)..
A d d processing tax receipts (deducted above)

D e d u c t general expenditures included a b o v e :
Agricultural A d j u s t m e n t A d m i n i s t r a t i o n
Refunds of processing taxes
Subscriptions to stock of F e d e r a l l a n d b a n k s . .

T o t a l r e c o v e r y a n d relief expenditm-es..

1936

$751,480. 25
137,450 23
6,198,00

$243, 541. 54
531,703.81

17,183,404.08
13, 002, 563. 35
6,170, 815. 47
1,908,471,87
401,033. 60
905, 286. 01
180 911.17
2 339,918.19

37,491,354. 68
15, 722,946. 75
10,197,883. 09
6, 260, 630,26
1,491,450 37
4, 490,965. 39
957,701. 03
418,175.19

475,105,628.93

•798,579,197.44

2.270,838,200.52

3,422,927,998.86

19,446,381.64
3,009,961.56

23,820,607.04
15,644,679.42

22,455,343.20

39,465,186.46

164,341, 934. 85
941, 044. 35

2 60,144, 064. 86
a 904,325.15

2102, 254,406. 06
66, 323, 044. 42
70, 739, 000. 00
369, 351. 41

88,691,246.34

605, 078, 647. 39
2, 654, 324.15

103, 262,104,46
66, 230, 752. 95
6, 479,835. 47
15,963,873. 02
3,661,937. 71
1, 638,875, 67
2 113, 512, 873. 64
2 2,616,496. 63

810, 565, 253. 20

108, 750 865. 34

105,000, 000. 00
110,000, 000. 00
5, 659. 821. 75
199, 889, 710 83
25, 000, 000. 00
39,125, 697.16
38,475, 70O 00
153,000, 000. 00
754, 800. 00
149, 502, 149. 65

15,000,000. 00
15,000, OOO 00

.2, 372,312. 69

265. 62
15,000, OOO 00
35, 509, 325. 69
200,000. 00
46, 000,000. 00
29,486,784. 08
497,850 35

826,407.879.;

156,754,225. 64

1,659,428,476.79

304, 970, 277.44

3 3,930, 266, 676. 31

3 3,727,898, 276. 30

3,930,266, 676. 31
353, 048, 796.83

3, 727,898, 276. 30
621,379,871. 22

4, 283, 315, 473.14

4, 249, 278,147. 52

279,723,062. 38
1,194,639.95
2 1, 737,780 00

561, 540, 268. 39
31, 208, 208. 32
1,939,140 00

279,179,922. 33

594, 687, 616. 71

4, 004,135, 550 81

3, 654,690, 630 81

1 A d d i t i o n a l expenditures for these accounts i n c l u d e d u n d e r recovery a n d relief e x p e n d i t u r e s .
2 Excess of credits, d e d u c t .
3 After deduction of processing tax r e c e i p t s .
4 E a r n i n g s in excess of expenditures, d e d u c t .
fi Includes real estate acquired a n d held for sale.

REPORT OP THE SECRETARY OP THE TREASUEY
THE PUBLIC DEBT

The fiscal year 1935 closed with the gross public debt outstanding
at $28,700,892,624.53 as compared with $27,053,141,414.48 outstanding on June 30,1934, an increase of $1,647,751,210.05. The net
changes brought about during the year in the amounts of the various
classes of securities which make up the outstanding debt are shown
in the foUowing table, in which the amounts of the various classes
outstanding at the beginning and at the end of the year are compared:
Changes in public debt outstanding June SO, 1934 and 1935, by classes
[On basis of daily Treasury statements (unrevised), see p, 293]

Interest-bearing d e b t :
P u b l i c issues:
P r e - w a r (including p o s t a l savings)
bonds.
.
Liberty bonds
Treasury b o n d s . . .
U n i t e d S t a t e s Savings B o n d s
.
Total bonds...
Treasury notes..
Certificates of i n d e b t e d n e s s
T r e a s u r y bills
Total
Special issues for i n v e s t m e n t
funds, etc.:
T r e a s u r y notes
Certificates of i n d e b t e d n e s s

J u n e 30, 1936

$831, 350, 370 00
1 6,295,020,300.00
9,332,732,350.00

$855, 263,470. 00
21,246,230, 750.00
12, 683, 670, 300. 00
8 62,047,818. 76

+$23,913, IOO 00
-5,048,789,650. OO
+3,350,837,950 OO
+ 6 2 , 047,818. 75.

16.459,103, 02O 00
6, 653, 111, 90O 00
1,517, 245,000.00
1,404,035,000 00

14,847,112,338.75
10,023, 251,900.00

—1,611,990.681.25
+3,370,140,000. oa
—1,517,245,000.00
+648,863,000.00-

26, 033,494, 920 00

26,923, 262, 238. 75

+889, 767, 318. 75-

278,439,000. 00
117,800, OOO 00

477,742,000.00
165, 500,000. 00

+199, 303,000. OO
+37,700,000. o a

396. 239. OOO 00

633, 242, OOO 00

+237, 003, 000. 00-

126,429, 733,920.00 2 27,556,504,238.75
6 319,399,005.26
* 106,020, 780. 26
518,386,714, 22
824,989,380. 62

+1,126,770,318.75
+214, 378,225.00=
+306,602, 666.30

2,052,898,000.00

of t r u s t

Total
T o t a l interest-bearing d e b t .
M a t u r e d d e b t o n w h i c h interest h a s ceased
D e b t bearing n o interest
T o t a l gross d e b t

Increase ( + ) or
decrease (—)

J u n e 30,1934

27,063,141,414. 48

28, 700,892, 624.63

+1,647,761,210.05-

1 Excludes $50,763,950 estimated amount of outstanding first-called Fourth 4H's on which interest has
2 Excludes $88,736,850 estimated amount of outstanding first-, second-, and third-called Fourth i H ' s ons
which interest has ceased.
8 Includes only bonds sold during March and April less redemptions through June 30. The amount
sold during March to June inclusive amounted to $96,365,687.60 as shown in the table on page 24, and
subtracting redemptions to that date (on the basis of daily Treasury statements, revised), the amount
actually outstanding on June 30,1936. was $96,834,700.00. Sales during May and June were not taken intO'
the Treasurer's books, however, until the next fiscal year.
4 Includes $50,753,950 referred to in note 1.
fi Includes $88,736,850 referred to in note 2.

Open market issues during the year aggregated $12,099,919,493.75,.
and maturities and redemptions aggregated $11,234,065,275.00, with a
resulting increase of $865,854,218.75 in this class of debt outstanding.
Open market transactions during 1935 are summarized in the table on
page 14.

EEPOET OF THE SECEETAEY OF THE TEEASUEY

REPORT OF THE SECRETARY OF THE TREASURY

Open market issues, maturities, and redemptions during the fiscal year 1935 {pre-war
and postal savings bonds excluded)
[On basis of d a i l y T r e a s u r y s t a t e m e n t s ( u n r e v i s e d ) , see p . 293]
Outstanding June
30,1934
Numberof
issues
Liberty bonds
Treasury bonds
U n i t e d S t a t e s Savings B o n d s
T r e a s u r y notes
Certificates of indebtedness
T r e a s u r y bills
Total

Amount

Issues

Numberof
issues

Amount

Maturities and
redemptions
Numberof
issues

Amount

Outstanding June
30, 1935
Numberof
issues

Amount

2 i$6,295,020, 300
12 9, 332,732, 350

2 $3,351,392,950

1 2$5,048,789, 550
* 555,000

1 3$1,246,230, 760
14 12, 683, 670,300

15 6,653, 111, 900

1
8 62, 567, 044
5 4,678,893, 600

* 519, 225
3 71,308,753, 500

1
6 62,047,819
17 10,023, 261,900

2 1, 617,246,000
23 1,404, 035,000

63 4,007,066,000

2 1, 617, 245,000
49 3,358, 203,000

37 2,052,898,000

64 25,202,144, 550

71 12,099,919,494

65 11,234,065,275

70 26,067,998,769

1 Excludes $50,753,950 estimated amount of outstanding first-called Fourth 4H's on which interest has
ceased.
* Includes First Liberty Loan bonds called for redemption June 16, 1935, and estimated amount of
Fourth Liberty Loan bonds included in second and third calls for partial redemption ()ct. 15,1934, and Apr.
16,1935, respectively.
t Excludes $88,736,860 estimated amount of outstanding first-, second-, and third called Fourth 4H's on
which interest has ceased.
* Redemptions prior to maturity, i
fi Includes only bonds sold during March and April.
6 Includes only bonds sold during March and April less redemptions through June 30. See note 3, p. 12.
7 Includes $335,686,600 Treasury notes, series B-1935, due Aug. 1,1935, redeemed June 15,1936, in exchange
for Treasury notes, series B-1940.

These transactions occasioned a considerable alteration of the
composition and of the final maturity of the interest-bearing debt
outstanding. The composition of the debt divided between six
types of obligations, from January 1926 to June 1935, is shown in
the chart on page 13, in which the total interest-bearing debt outstanding each month is taken as IOO percent. The various maturities, by
years, of the interest-bearing debt outstanding as of June 30 for each
of the last four years are shown in chart 5 on the page opposite.
On the basis of the interest-bearing debt outstanding on June 30,
1934, and on June 30, 1935, the computed annual interest charge was
reduced from $842,301,133 to $748,878,754, and the computed
average rate of interest borne was reduced from 3.181 to 2.715
percent. The reduction of $93,422,379 in the computed annual
interest charge, notwithstanding an increase of over one billion- dollars
in the outstanding interest-bearing debt, was brought about through
money market conditions which permitted the issue of new debt at
low rates of interest, as is indicated by the reduction of 0.466 percent
in the computed rate. Actual expenditures for interest during 1935
were $820,926,353.45.
The course of the interest-bearing debt outstanding and of the
computed rate of the interest charge on that debt from January 1919
through June 1935, is shown in chart 6 on page 16 and in table 32 on
page 401.

EEPOBT OF THE SECEETAEY OF THE TEEASTJEY

MATURITY,|BY CALENDAR YEARS, OF THE INTEREST-BEARING PUBLIC DEBT OUTh\:&
STANDING 1 AS OF JUNE. 30, 1932 TO 1935
B///S

Bonds

DOLLARS .
Billions

D0LL/^5S
As

June

1932

'34

'36

'38

'40

'42

'44

'46

'48

June

'50

'52

'54

'56

'58

'60

'50.

'52

'54

'56

'58

'60

"50

'52

'58

'60

'58

1933

1932

'34

'36

"38

•

"40

•

'42

*44

'46

'48

June

1934

1932

'34

'36

'38

'40

'42

'44

'46

'48

of J u n e

^ 11 IS p B I
"54

'56

-—L 0

1935

1932

'34

"36

'38

'40

'42

iJiall.,..,l.,ili
'44

'46

'48

'50

'52

'54

'56

'60

CHART 6.

Exclusive of consols, postal savings bonds. United States Savings Bonds, and special obligations
issued to governmental trust funds and agencies. Certificates of indebtedness are included vs^ith Treasury
notes,
16816—36^

REPORT OP T H E SECRETARY OP T H E TREASUEY

Issues during the year
Net new issues during the year were confined to sales for cash bf
$967,861,000 of Treasury bonds and notes on December 15, 1934,
weekly sales of Treasury bills in moderate amounts, the total for the
year being $648,863,000 in excess of maturities, and the sale for cash,
on a bid basis, on June 3, 1935, of $98,708,000 par amount of 3 percent Treasury bonds of 1946-48. Otherwise the open market issues
were offered only in exchange for maturing or called obligations.
INTEREST-BEARING DEBT OUTSTANDING i AND COMPUTED RATE OF INTEREST
THEREON, BY MONTHS, JANUARY 1919 TO JUNE 1935
1931

DOLLARS
Billionss

1933

/
/

25 -r—p\

DOLLARS
Billions
E

~-^ V.VS
^ Int 2rQSt -Bear ing C (Zbt

/
^
=0=:

=:i:=:c:
PER
CENT

•^-,

4.0

~^-v.

PER
CENT

-•........•V.-V. -«
*•-...........'••-•'X
\

'^s..

Computed IntarQSt Ratz r

3.5

'
.

3.5

"V.
^

s\
2.5

1919

1921

1925"^^

1927

1929

2.5

CHART 6.

On September 10, 1934, in addition to exchange offerings made to
the holders of second-called Fourth Liberty Loan bonds, an issue of
2-year 1^ percent Treasury notes of series I)-1936 was offered in
exchange for \){ percent Treasury certificates of indebtedness maturing September .15, 1934. The subscription books were closed on
September 13, 1934, and $514,066,000 of the $524,748,500 maturing
certificates were exchanged for the new^ Treasury notes.
On December 3, 1934, the December 15 financing was announced,
there being offered for cash $450,000,000 of 15-18 year 3}^ percent
1 On basis of daily Treasury statements (revised). Exclusive of United States Savings Bonds.

REPORT OF THE SECRETARY OP THE TEEASUEY

Treasury bonds of 1949-52 and $450,000,000 of l^-year D^percenl
Treasury notes of series E-1936. In addition, the lYs percent notes
and an additional issue of 2% percent notes of series A-1939 were
offered in exchange for 2}^ percent Treasury certificates of indebtedness of series TD-1934, of which $992,496,500 were maturing on
December 15, 1934. The subscription books for the cash offerings
were closed on the opening day, December 3, and those for the exchange offerings were closed on December 6, 1934. Cash subscriptions aggregating $2,334,467,500 were received for the 3}^ perceiat
Treasury bonds of 1949-52, of which $491,377,100 were allotted, and
cash subscriptions aggregating $3,036,069,900 were received for the
1^8 percent Treasury notes of series E-1936, of which $476,483,900
were allotted. With respect to the exchange subscriptions, $210,132,500 of the maturing certificates were exchanged for the 1}^ percent
Treasury notes of series E-1936 and $765,192,500 wei;e excjianged for
the 2% percent Treasury notes of series A-1939. Accordingly, exchanges aggregated $975,325,000 and only $17,171,500 of the maturing
certificates were not exchanged.
In addition to the exchange offering of bonds for third-called
Fourth Liberty Loan bonds on March 4, 1935, an issue of 5-year,
1% percent Treasury notes of series A-1940 was offered in exchange
for 2)^ percent Treasury notes maturing March 15, 1935. The
subscription books were closed on March 8, 1935, and $513,884,200
of the $528,101,600 of maturing Treasury notes w^ere exchanged for
the new series.
On May 27, 1935, tenders were invited for an additional issue of
$1:00,000,000 pf 3 per.cent Treasury bonds of 1946-48. Tenders
aggregating $270,077,000 were received up to May 29, 1935, amd
tenders aggregating $98,708,000, at prices ranging from 103^^2 down
to 103^2 inclusive, were accepted. The average price of the bonds
issued was 103^^2 and a total premium of $3,082,863.87 was received..
On June 24, 1935, tenders were again invited for an additioiiai
$100,000,000 of the same bonds. Tenders aggregating $461,341,0.60
were received up to June 26, and those ranging in price from 103^^2
down to 103iJ^2, aggregating $112,669,000, were accepted. The
average price of the issue was 103^%2, and a premium of $4,005,378.18
was received—payment being made on July 1, 1935.
On June 10, 1935, an issue of 5-year IK percent Treasury notes
of sei'ies B-1940. was offered in exchange for 3 percent Treas*'
ury notes of series A-1935 maturing June 15, 1935, of which
$416,602,800 were outstanding, and for 1% percent Treasury notes of
series B-1935 maturing August 1, 1935, of which $353,865,000 were
outstanding. The subscription books were closed on June 13, 1935,,
at which time $402,741,800 of the notes maturing June 15 a n i
$335,686,600 of the notes maturing August 1, or a total of $738,42.8^400,
were exchanged for the new notes.

REPORT OF THE SECRETARY OF THE TREASURY

The refunding of the First and Fourth Liberty Loans, the calls of
the 2 percent bonds, the issue of United States Savings Bonds, and
an account of the cumulative sinking fund, are discussed separately
in the pages following.
Details of the open market transactions are set forth in the statement appearing as table 25 on page 394, in which each separate issue
offered, matured, or redeemed during the year is shown. All official
circulars and public statements, relating to these transactions during
the fiscal year are included among the exhibits appended to this
report.
Second Liberty Bond Act—Further amendments
The act of February 4, 1935, further amended the Second Liberty
Bond Act in several important particulars, so as to permit more
flexibility and economy in Government financing.
Before the amendment in question, the act authorized the issue of
$28,000,000,000 of bonds, which authority was not recurring, and in
addition authorized the issue of $10,000,000,000 of notes outstanding
at any one time and $10,000,000,000 of certificates of indebtedness or
Treasury bills outstanding at any one time. In lieu of this authority,
the act of February 4, 1935, established a revolving authority for the
issue of bonds, providing that not exceeding $25,000,000,000 may be
outstanding at any one time, and at the same time consolidated
authority to issue notes, certificates of indebtedness, and Treasury
bills so as to provide that not exceeding $20,000,000,000 of these
classes in the aggregate may be outstanding at any one time. The
former language authorizing the issue of bonds, notes, certificates of
indebtedness, and Treasury bills was modified so as to bring the
language of the several sections of the act into agreement as to the
purposes for which such securities might be issued.
The new act also gave authority for the issuance of United States
Savings Bonds, a new type of security, to be issued on a discount
basis, with maturities not less than 10 nor more than 20 years with
provision for redemption prior to maturity at the option of the holder,
and at an issue price to afford a yield not in excess of 3 percent per
annum, compounded semiannually. The act also repealed authority
for further issues of postal savings bonds after July 1, 1935, and made
provision for the conversion of postal savings deposits into Savings
Bonds-. I t further authorized the use of the Postal Service for the
sale of these bonds.
The act of February 4, 1935, wUl be found as exhibit 31 on page 243.
Cumulative sinking j u n d
The appropriation available for the cumulative sinking fund during
the fiscal year 1935, including an unexpended balance of $79,354,835
brought forward from the fiscal year 1934, was $573,183,652.

REPORT OP THE SECRETARY OP THE TREASURY

Fourth Liberty Loan bonds called for redemption on April 15 and
October 15, 1934, and AprU 15, 1935, in an aggregate face amount of
$421,407,750, and First Liberty Loan bonds, called for redemption
on June 15, 1935, in an aggregate face amount of $151,592,250,
were redeemed at par for account of the fund, and an unexpended
balance of $183,652 was carried forward to the fiscal year 1936.
Tables covering transactions on account of the fund for the fiscal
year 1935, and since its inception on July 1, 1920, will be found on
pages 398 and 399 of this report.
Refunding oj Fourth Liberty Loan continued ^
The refunding of the Fourth Liberty Loan 4}^ percent bonds of
1933-38, begun during the fiscal year 1934, was continued during
1935. On October 12, 1933, an amount estimated at $1,880,428,200
of the outstanding bonds was called for redemption on April 15, 1934.
In response to an exchange offer made at tbe time of the call $874,863,900 of first-called bonds and $25,852,650 of uncaUed bonds were
exchanged for 4 ^ - 3 ^ percent Treasury bonds of 1943-45. In April
1934, $827,494,000 of first-called bonds were exchanged for 3}^ percent Treasury bonds of 1944-46, and a balance of $178,070,300
remained for cash redemption. The second call, for the redemption of
$1,246,231,800 of the outstanding bonds on October 15, 1934, was
issued on April 13, 1934. .
On September 10, 1934, an additional issue of 3}{ percent Treasury
bonds of 1944-46, and an issue of 4-year 2K,percent Treasury notes of
series D-1938, were offered, both in exchange for Fourth Liberty
Loan bonds called for redemption on October 15, 1934. The sub-"
scription books for the Treasury notes were closed on September 24,
and those for the Treasury bonds on October 11, 1934. Through
these offerings, $456,898,300 of the second-called Fourth Liberty Loan
bonds were exchanged for 3K percent Treasury bonds of 1944-46 and
$596,416,100 were exchanged for 2K percent Treasury notes of series
D-1938. There remained outstanding for cash redemption $192,917,400 of the Fourth Liberty Loan bonds called for redemption on October
15, 1934.
On October 12, 1934, the third call was issued for the redemption on
AprU 15, 1935, of approximately $1,869,346,100 of the outstanding
Fourth Liberty Loan bonds. For the refunding of those bonds^
announcement was made on March 4, 1935, of an offering of 20-25
year 2% percent Treasury bonds of 1955-60 to be issued in exchange
1 Fourth Liberty Loan bonds (temporary coupon, permanent coupon, and registered) were numbered
serially beginning with no. 1 for each denomination, and all bonds were issued in this serial order. Accordingly, the outstanding bonds were divisible into 10 approximately equal series as determined by the final
digits of the serial numbers, and this approximate division was the basis for determining the amounts
included in each of the 4 calls. In the account under this heading, this approximate division has been used.
It follows that such amounts are subject to adjustment as bonds are redeemed.

REPORT OP THE SECRETARY OP THE TREASURY

for the called bonds. This exchange offering of Treasury bonds of
1955-60 was terminated on March 27, 1935, at which time $1,558,022,650 of the Fourth Liberty Loan bonds called for redemption on
April 15, 1935, had been exchanged for the new Treasury bonds,
and of the called bonds approximately $311,323,450 remained outstanding for cash redemption on or after April 15.
On April 14, 1935, the fourth and final call was issued for the
redemption on October 15, 1935, of the remainder of the outstanding
Fourth Liberty Loan bonds not previously called, the amount included
in the final call being estimated at $1,246,230,750. No action for the
refunding of these bonds was taken before the close of the fiscal year.
Up to the close of 1935, of the $6,268,094,150 of the Fourth Liberty
Loan bonds outstanding October 12, 1933, $4,339,547,600 were
exchanged for other issues, $593,578,950 were redeemed for cash, and
there remained outstanding on June 30, 1935, approximately
$88,736,850 on which interest had ceased and approximately
$1,246,230,750 called for redemption on October 15, 1935. On the
basis of the exchanges to the end of the fiscal year 1935, the annual
interest charge was reduced $53,711,182.
A brief summary of the refunding operations to June 30, 1935,
follows:
Fourth 4>4's outstanding Oct. 12, 1933

$6, 268, 094, 150

Exchanged for—
4K-3>1 percent Treasury bonds of 1943-45_
$900, 716, 550
3K percent Treasury bonds of 1944-46_.- 1, 284, 392, 300
2% percent Treasury bonds of 1955-60_-_ 1, 558, 022, 650
2y2 percent Treasury notes, series D-1938_
596, 416, 100
Total exchanged
Redeemed for cash

4, 339, 547, 600
593, 578, 950

Total retired to June 30, 1935
4, 933, 126, 550
Balance outstanding June 30, 1935:
First-, second-, and third-called (payable
on presentation)
i 88, 736, 850
Fourth-called, for redemption on Oct. 15,
1935
1 1,246,230,750
Total outstanding

_._

1, 334, 967, 600
6, 268, 094, 150

The official calls and the official circulars governing redemptions
and offering exchange issues during tbe year, will be found in the
public debt exhibits beginning on page 181 of this report.
I Estimated amount subject to adjustment as bonds are redeemed

EEPORT OF THE SECEETAEY OF TBtE . TEEASUEY

Rejunding oj First Liberty Loan
On March 14, 1935, all outstanding First Liberty Loan bonds,
including those of the original issue and those subsequently issued on
conversion were called for redemption on June 15, 1935. The First
Liberty Loan, in the form of 3K percent bonds, was originally issued
June 15, 1917, in the total amount of $1,989,455,550. Subsequently
three conversion privileges arose, and the 3}^ percent bonds were in
part converted into other First Liberty Loan bonds bearing interest
at 4 or 4% percent, and the 4 percent bonds issued on conversion were
largely converted into 4}^ percent bonds. At the time of the call.
First Liberty Loan bonds, divided among the four issues, were outstanding as follows:
First 3H's
First converted 4's
First converted 4K's
1.
First-second converted 4)^'s

$1, 392, 226, 250
5, 002, 450
532, 489, 100
3, 492, 150
1, 933, 209, 950

On April 22, 1935, announcement was made of the offering of additional issues of 20-25 year 2% percent Treasury bonds of 1955-60,
and of 5-year 1% percent Treasury notes of series A-1940, both in
exchange for First Liberty Loan bonds of any series, called for redemption on June 15, 1935. The Treasury bonds and the Treasury
notes then offered were identical in all respects with the bonds and
notes offered on March 4, 1935, and formed a part of those respective
issues.
The bonds and the notes were offered at par, with the right reserved
to increase the issue price of either the bonds or the notes, or both,
by public announcement effective at any time fixed by the Secretary
but not earlier than April 29, 1935.
The exchange offering of 1% percent Treasury notes was terminated
on May 2, 1935. On May 3, 1935, public announcement was made
that the issue price of the 2% percent Treasury bonds offered in exchange would be increased to lOOK, effective after May 7, 1935. The
exchange offering of Treasury bonds was terminated on May 23, 1935.
First Liberty Loan bonds aggregating $1,610,886,550 were exchanged, $746,406,550 for 2% percent Treasury bonds of 1955-60
and $864,480,000 for 1% percent Treasury notes of series A-1940, and
$322,323,400 of the called bonds remained outstanding for cash

REPORT OP THE SECRETARY OF THE TREASURY

redemption pursuant to the call. A summary of the refunding
operation foUows:
Outstanding March 14, 1935

$1, 933, 209, 950

Exchanged for—
2% percent Treasury bonds of 1955-60
1% percent Treasury notes, series A-1940-_

$746, 406, 550
864, 480^ 000

Total exchanged
Cash redemptions to June 30, 1935.-

1,610,886,550
177, 521, 750

Total retired to June 30, 1935__-.
Outstanding June 30, 1935, payable on presentation

1, 788, 408, 300
144, 801, 650
1,933,209,950

The official call and the official circulars governing the redemption
and offering the exchange issues are presented as exhibits 11, 13, and
14 beginning on pages 210, 217, and 222 of this report. A statement
showing details of the refunding appears as exhibit 15 on page 223.
Redemption oj 2 percent bonds
On March 11, 1935, caUs were issued for the redemption on July 1
of the outstanding 2 percent consols of 1930 and for the redemption
on August 1, 1935, of the outstanding 2 percent bonds of the Panama
Canal loans of 1916-36 and 1918-38. The 2 percent consols in the
amount of $646,250,150 were issued between 1900 and 1907 under
the act of March 14, 1900, in refunding a hke amount of outstanding 3, 4, and 5 percent bonds. Under section 18 of the Federal
Reserve Act $46,526,100 of the consols were refunded into 3 percent
bonds and notes, reducing the amount outstanding to $599,724,050,
the amount called. Two percent bonds, in the amount of $84,631,980,
were issued under the act of June 28, 1902, to provide funds for the
construction of the Panama Canal. These bonds were issued in two
series, $54,631,980, dated August 1, 1906, making up the series of
1916-36, and $30,000,000, dated November 1, 1908, making up the
series of 1918-38. Under the Federal Reserve Act, $5,677,800 of the
former and $4,052,600 of the latter series were refunded into 3 percent bonds or notes reducing the amounts outstanding to $48,954,180
and $25,947,400, respectively.
For many years the only outstanding bonds available for deposit
as security for the issue of circulating notes of national banks were
the 2 percent consols of 1930 and the two series of 2 percent Panama
Canal bonds. As an emergency measure, by a provision of the
Federal Home Loan Bank Act approved July 22, 1932, the circulation privilege was attached to all bonds of the United States bearing
interest at a rate not exceeding 3% percent per annum for a 3-year
period, terminating July 22, 1935. Retirement of the 2 percent

REPORT OF THE SECRETARY OP THE TEEASUEY

consols of 1930 and the 2 percent Panama Canal bonds, and the
expiration of the authority to use other bonds as security for the
issuance of circulating notes of national banks will eventually result
in the elimination of national bank notes as a medium of circulation
and to such extent will accomplish a simplification of the currency
system of the United States.
At the time the calls were issued it was announced that in retiring
the called bonds the Treasury would make use of part of the balance
of gold in the General Fund resulting from the reduction in the weight
of the gold doUar, and that gold certificates would be issued to the
Federal Reserve banks in an amount about equal to that of the bonds
retired, a like amount of gold being withdrawn from the General
Fund as security for the gold certificates issued. The gold certificates
issued to Federal Reserve banks will form added reserves against
which Federal Reserve notes may be issued in replacement of the
national bank currency retired. It was subsequently decided that
such gold certificates should be issued to the Federal Reserve banks
only as rapidly as the national bank currency in circulation is actually
retired, in order to avoid a temporary increase in member bank
reserves during the interim between the redemption of the 2 percent
bonds and the actual retirement of the national bank currency. The
gradual retirement of the national bank currency and the issuance of
gold certificates to the Federal Reserve banks in accordance with this
program is now in progress.
Deposits in the Treasury by national banks of moneys for the retirement of national bank notes, principally in anticipation of the retirement of the 2 percent bonds, together with deposits by Federal
Reserve banks for the retirement of Federal Reserve bank notes
during the fiscal year amounted to $553,936,922.50 or $306,626,602.50
in excess of expenditures for the redemption of such currency. Such
unexpended deposits for the retirement of national bank and Federal
Reserve bank currency are carried as '^noninterest-bearing debt"
and account entirely for the increase in this item shown in the table
on page 12.
The public announcement concerning the retirement of the 2
percent consols and the 2 percent Panama Canal bonds, the official
calls for redemption, and the official circulars governing the redemption of these bonds, are included as exhibit 10 on page 204 of this report.
United States Savings Bonds

United States Savings Bonds, a new type of Government security,
were placed on sale beginning March 1, 1935. These bonds, authorized under the Second Liberty Bond Act, as amended by the act of
February 4, 1935, are issued on a discount basis. Bonds of the

REPORT OP T H E SECRETARY OP T H E TEEASUEY

initial series, the sale of which is limited to the calendar year 1935,
will mature in each instance 10 years from the first day of the month
in which issued. The issue price of these securities was fixed at $75
for each $100 face amount, and at this price the investment yield is
about 2.9 percent, compounded semiannually, if the bonds are held
to maturity. The bonds are fully registered and are not transferable.
They are issued in denominations of $25, $50, $100, $500, and $1,000
(maturity value), and a single ownership is limited to $10,000 (maturity value) of bonds issued in any one calendar year. A Savings
Bond may be redeemed prior to maturity (but not within 60 days after
the issue date), at the owner^s option, at fixed redemption values which
increase each 6 months after 1 year from the issue date. If redeemed
prior to maturity the investment yield is less than if the bond is held
to maturity. For the sale of United States Savings Bonds the Postal
Service has been utilized, and these bonds are on sale at about 14,000
post offices, including those of the first, second, and third class, and
a few of the fourth class.
During the period March 1 to June 30, 1935, United States Savings
Bonds in the aggregate maturity value of $128,487,450 were sold, for
which cash aggregating $96,365,587.50 was received. Redemptions,
on the basis of daily Treasury statements (revised), amounted to
$172,068.75 in May and $358,818.75 in June, or a total of $530,887.50.
Sales by months and denominations follow:
Sales of United States Savings Bonds, hy months ^ and denominations, March 1 to
J u n e SO, 1935
^$25

$50

$100

$500

$1,000

Total

MATURITY VALUE
March
April
May
June

--_
-

Total

$1,301,975 $1, 672,750. 00 $7,487,300 $13,676,500. $27, 713, 000 $51, 751, 625. 00
695,925
859,850. 00 4,336,600
8, 010,500- 17,912, 000 31,714,876.-00
421,975
651,950. 00 3,104, 600
6,811,000 13,-807,000:- '23,796,525.00
379,826
594, 600. 00 2,813,100
4,957,000 12,480,000 21,224,525.00
2,699,700

3, 779,150.00

17,741,600

32,355, 000 71,912,000 128,487,450,00

CASH R E C E I P T S
TotaU

$2, 024, 775 $2,834, 362. 50 $13, 306,200 $24, 266, 250 $53,934,000 $96,365, 587. 60

1 Separation of sales by months on the basis of final Treasury audit of sales reported by the Postal Service
through June 30.

It should be noted, however, that most of the tables in this report
showing the public debt outstanding on June 30, 1935, include only
United States Savings Bonds sold and reported by the Post Office
Department in March and AprU, less redemptions to June 30. Sales
are taken into the Treasurer's books as part of the public debt

EEPOET OF THE SECEETAEY OF THE TEEASUEY

between one and two months after the close of the month in w^hich
the sales are made. Accordingly, actual sales during May and
June did not appear in the public debt until after the close of the
fiscal year. In the interim, necessary for verification, the cash
receipts from sales of such bonds by the Postal Service were carried
as a special account in the General Fund to the credit of the Postmaster General. Postal Service reports of sales through June 30
appear as exhibit 7, page 199.
Department Circular No. 529, offering United States Savings Bonds
for sale, and Department Circular No. 530, prescribing regulations
governing the bonds, both dated February 25, 1935, will be found as
exhibits 6 and 33 on pages 197 and 246 of this report.
GENERAL FUND OF THE TREASURY

All cash.receipts of the Government are deposited in the General
Fund of the Treasury and all expenditures are made from it. The
balance in this fund represents the cash balance of the Government.
The net change in this balance from the close of the previous fiscal
year is accounted for as follows:
Analysis of the change in the General Fund balance between June SO, 1934, and
June SO, 1935
[On basis of daily Treasury statements (unrevised), see p. 293. For a description of accounts through which
Treasury transactions are effected, see p. 294]
Balance, June 30, 1934
Ordinary receipts:
General and special funds
Trust funds, increment on gold, etc
Net increase in gross public debt

$2,581,922, 240.16
3,800,467,201.96
371,509,695.45
1,647, 751,210.05

Total funds available.-Expenditures chargeable against ordinary receipts:
General and special accounts
$7,375,825,165.57
Less public debt retirements
573,558,250.00
Trust'funds,' increment on gold,.etc.Less national bank note retirements

8,401,650,347.62

$6,802, 266,915. 57
^ 150,.546,457,,,42 ..,.
91,415,650,00
» 241, 962,107. 42

Total expenditures (excluding retirements of
public debt and national bank notes)

6,560,304,808.15

Balance, June 30, 1935

1,841,345,539.47

The composition of the General Fund of the Treasury, existing liabUities against the assets in the fund, and the balances in excess of
such liabUities are shown for June 30, 1934 and 1935, in the table
following. Similar information is presented in somewhat greater
detail, on the basis of the daily Treasury statements (revised), in the
table on page 406 of this report.
1 Excess ofcredits (deduct). .

REPORT OF T H E SECRETAEY Ol' T H E TEEASURY

Current cash assets and liabilities of the Treasury, June SO, 1934 and 1935, and
changes during the year
[On basis of daily Treasury statements (unrevised), see p, 293]
J u n e 30, 1934
Gold-assets: Gold i
.__
D e d u c t gold liabilities:
Gold certificates o u t s t a n d i n g (outside of
Treasury)
.
.
.
Gold certificate fund, Federal Reserve
Board
.
. . .
. .
R e d e m p t i o n fund, F e d e r a l Reserve n o t e s . .
Gold reserve 2 .
^ ^ E x c h a n g e stabilization fund
Total
Gold i n General F u n d

J u n e 30, 1935

$7,856,074, 225, 67 $9,115,380,809.40

958, 684, 599, 00

787,745,989,00

Increase ( + ) , decrease (—)
+ $ 1 . 259,306, 583,73

-170,938,610.00

3,973, 332, 588. 66
25, 722. 721. 73
156,039,430.93
1,800, 000,000. 00
6,913. 779, 340. 32
942, 294,885. 35

5,509,710,115.48
22,879,855. 28
156,039,430.93
1,800, 000,000. 00
8, 276, 375, 390. 69
839, 005, 418. 71

+1,536. 377, 526.82
-2,842,866.45

Silver assets:
Silver
Silver dollars
Total

1, 560, 000. 00
503,852, 622. 00
505, 412, 622. 00

313,308,863.15
510,024, 945. 00
823, 333, 808.15

+311, 748, 863.15
-1-6,172, 323. 00
-1-317,921,186.16

D e d u c t silver liabilities:
Silver certificates o u t s t a n d i n g
T r e a s u r y notes of 1890 o u t s t a n d i n g

494,996, 414. 00
1,189, 324. 00

810, 040,419. 00
1,181, 574. 00

496.185, 738. 00
9, 226,884. 00

811, 221,993. 00
12,111,815.15

+315,044,006.00
- 7 , 750.00
+315,036, 256.00
+2,884, 931,16

942, 294,885. 35
9, 226, 884. 00
93, 668, 569.49

839, 005,418. 71
12,111,815.15
192,906, 203.17

- 1 0 3 , 289,466,64
+2,884,931,16
+ 9 9 , 237, 633. 68

1,984,894,916.20
2,831,924. 78
3, 032,917,179. 82

958,480,491. 77
13, 565, 097. 25
2,016,069,026.05

- 1 , 026,414,424,43
+ 1 0 , 733,172.47
-1,016,848,153. 77

4.50. 994. 939. 66
D e d u c t General F u n d liabilities
B a l a n c e in t h e General F u n d of t h e T r e a s u r y . . 2, 581,922, 240.16
Balance of i n c r e m e n t resulting from r e d u c t i o n
in weight of t h e gold dollar
811, 375, 756. 72
Seigniorage ^
.._
1, 770, 546, 483. 44
Working balance.
Balance in t h e General F u n d of t h e
Treasury
. . 2, 581,922, 240.16

174. 723,486. 58
1,841,345,639.47

- 7 4 0 , 576, 700, 69

700,091,147. 08
140, 111, 441. 47
1,001,142, 950. 92

- 1 1 1 , 284, 609. 64
+140, 111, 441.47
-769,403, 532. 52

1,841, 345, 539. 47

—740, 576, 700. 69

Total
Silver in General F u n d
General F u n d assets:
I n T r e a s u r y offices:
Gold (as above)
Silver (as above)
O t h e r coin, c u r r e n c y , a n d bullion
I n depositary b a n k s , reserve b a n k s , a n d
treasury of P h i l i p p i n e Islands
All other—collections, e t c
Total

+ 1 , 362, 696,050. 37
-103,289,466.64

- 2 7 6 , 271,453. 08

1 Gold valued at $35 per fine ounce.
2 Reserve against $346,681,016 of United States notes and Treasury notes of 1890 outstanding in the amount
of $1,189,324 in 1934 and $1,181,574 in 1935. Treasury notes of 1890 are also secured by silve'r dollars in the
Treasury.
3 This item represents seigniorage resulting from the issuance of silver certificates equal to the cost of
the silver acquired under the Silver Purchase Act of 1934 and the amount returned for the silver received
under the President's proclamation dated Aug. 9,1934.

ElMERGENCY LEGISLATION

During the fiscal year 1935, further appropriations and allocations
of funds were made for the purpose of continuing the Federal program to furnish relief and to aid recovery. An increase in the capital
structure of certain corporate agencies of the Government was
authorized, funds were appropriated for an extensive emergency
public employment program, and the borrowing limits of the Treasury were raised by amendments to the Second Liberty Bond Act.
These amendments are discussed on page 18 of this report.
On June 30, 1935, the amount of capital stock and obligations that
the Reconstruction Finance Corporation was authorized to have
outstanding at any one time was $6,050,000,000, exclusive of indefinite authorizations for which there is no statutory limitation. By
the act approved January 31, 1935, extending the life of the Corporation, the authorization had been increased in the amount of $100,000,€00 to enable the Corporation to subscribe for, or make loans upon,

EEPORT OF THE SECRETARY OF. THE , TEEASUEY

nonassessable stock of national mortgage associations organized
under the National Housing Act and of other mortgage institutions.
The same act increased from $50,000,000 to $75,000,000 the authorization to subscribe to preferred stock and purchase capital notes of
insurance companies.
During the year the Reconstruction Finance Corporation made
further sales of its notes to the Secretary of the Treasury in the net
amount of $400,000,000. As of June 30, 1935, the total sold to theTreasury amounted to $3,655,000,000 excluding the original $500,000,000 of the Corporation's capital stock purchased by the Treasury.
Notes issued by the Corporation directly to banks from which theCorporation purchased capital stock increased by $14,957,000 to
$249,771,667 during the fiscalyear.
An amendment, approved May 28, 1935, to the Home Owners'^
Loan Act of 1933, increased the bond-issuing authority of the Home
Owners' Loan Corporation from $3,000,000,000 to $4,750,000,000 in
order to enable that Corporation to provide further relief to individual home-mortgage borrowers.
The Emergency Relief Appropriation Act of 1935, approved AprU
8, 1935, provided funds for additional emergency activities of th&
Government. A direct appropriation of $4,000,000,000 was made to
provide relief and work relief and to increase employment by providing for useful projects. It is to remain available until June 30, 1937.
An additional amount not to exceed $880,000,000 was reappropriated
from the unexpended balances of funds of the Reconstruction Finance
Corporation and of other emergency appropriations. The $4,000,000,000
appropriation was made available for the foUowing classes of projects
in the amount indicated after each class:
Highways, roads, streets, and grade-crossing elimination
$800,000,000
Rural rehabilitation and relief in stricken agricultural areas, water conservation, etc
600,000,000
Rural electrification
100,000,000
Housing...
450,000,000
Assistance for educational, professional, and clerical persons..
300,000,000'
Civilian Conservation Corps
^
600,000,000'
Loans and grants for projects of States and local governments
900,000,000Sanitation, prevention of soil erosion, reforestation, flood control, rivers and harbors, miscellaneous
350,000, OOQTotal
4,000,000,000

It was further provided that the President might increase any one or
more of the foregoing limits by 20 percent of the appropriation.
The following table summarizes all funds appropriated for emergency purposes and allocated to governmental organizations, expenditures therefrom, and unexpended balances on June 30, 1935. Asshown in the table, $2,211,000,000 ofthe $4,000,000,000 appropriated,
under the Emergency Relief Appropriation Act of 1935 remained
unallocated on that date. Practically all of the funds made availableunder this act w^ere allocated by December 15, 1935. A subsidiary
table shows the details of revolving funds in which repayments and.
collections from previous loans are offset against payments for current'
loans made by Federal lending agencies.

REPORT OP THE SECRETARY OP THE TREASURY

Funds appropriated and allocated to emergency organizations^ expenditures therefrom, and unexpended balances, as of June SO, 1935
[In millions of dollars]
Sources of funds

Expenditures!

Appropriations

Organization
Specific

Statutory and
E x e c u t i v e allocations
ReconFiscal UnexstrucEmer- tion
year
NaFiscal 1934 p e n d gency
Fied
tional Emer- ReTotal year and
gency
n
a
n
c
e
In1935 prior
lief
ApCordusApyears2
trial pro- pro- poration
Re- pria- priation
covAct, tion
ery
1935 Act,
Act
1935

743
290
38
Agricultural A d j u s t m e n t A d m m i s t r a t i o n . . 3 1,683
(') 1,721
521
5 874
363
Less processing t a x
fi874
222
8 63
847
38
Net
809
9 60
164
400
8 397
3
C o m m o d i t y Credit Corporation ^
141
282
600
313
60
147
F a r m Credit Administration "
80
(10)
200
200
200
Federal F a r m Mortgage Corporation
Federal land banks:
2
123
125
C a p i t a l stock
125
34
126
41
Paid-in surplus
125
R e d u c t i o n in interest r a t e s on m o r t 13
7
23
gages
23
1,738
705\
Federal E m e r g e n c y Relief A d m i n i s t r a t i o n . jn 605
911 2,694{
152
545
481
77
40/
F e d e r a l S u r p l u s Relief C o r p o r a t i o n
834
805
11
89
400
Civil W o r k s A d m i n i s t r a t i o n
. . .
. . 11345
332
982
435
223
323
343
E m e r g e n c y conservation work
93
92
80
92
D e p a r t m e n t of Agriculture, relief
Public Works:
36
11
75
50
25
Tennessee Valley A u t h o r i t y
(12)
66
200
200
71
L o a n s t o railroads ^ - . . .
. . . . .
L o a n s a n d g r a n t s t o States, m u n i c i (12)
79
138
709
37
517
155
palities, etc.7.
268
317
1,193
500
437 ......
256
Public highways..
19
24
65
44
18
B o u l d e r C a n y o n project
. .
73
148
456
108
252
96
R i v e r a n d h a r b o r work
(10)
(10)
(10)
R u r a l Electrification A d m m i s t r a t i o n
1
1
W o r k s Progress A d m i n i s t r a t i o n
133
982
328
114
71
72 , 725
All o t h e r . . .
Uome Loan System:
(10)
81
126
125
H o m e loan b a n k stock
46
154
200
200
H o m e Owners' Loan Corporation
29
1
50
F e d e r a l savings a n d loan associations.. 13 50
(10)
7
196
162
34
E mergency housing
"
T
3
4
'
16
35
1
.Federal Ho.using A d m i n i s t r a t i o n
2 ......
141
99
3
39
R e s e t t l e m e n t ' A d m i ' n i s t r a t i o n .*
4
" 7
7
Subsistence h o m e s t e a d s
R e c o n s t r u c t i o n F i n a n c e Corporation—
4 4,264 4,264 9 135 2,'412
direct loans a n d e x p e n d i t u r e s ^
(1*)
14
93
3
13
1
E x p o r t - I m p o r t B a n k s of W a s h i n g t o n ^
(10)
160
150
(15)
150
Federal D e p o s i t I n s u r a n c e C o r p o r a t i o n . . .
22
7
12
5
17
A d m i n i s t r a t i o n for I n d u s t r i a l R e c o v e r y . . .
2,751 3,300 1,421 1,789 6,546 15,807 3,728 6,100
Total
Unallocated funds:
2,212
1 2,211
B y the President
(10)
4
By Public Works Administration
16 4
2,751 3,300 1,426 4,000 6,546 18, 023 3^728 6,100
G r a n d total

688
688
296
177
(10)

50
3
134
18
215
12
28
63
492
608
22
235
(10)

1
521
44
20
189
19
139
• 1

1,987
14
3
5,979
2,214
2
8,195

1 The expenditures in this table are on the same basis as those exhibited on p. 2 of the daily Treasury
statement, but differ with respect to classification. The purpose of this table is to show all funds appropriated or allocated to the respective emergency organizations, the expenditures therefrom, and the unexpended balances. The principal difference in classification of expenditures is with respect to amounts
paid from funds allocated by the Reconstruction Finance Corporation to various emergency organizations.
The expenditures in the daily Treasury statement under the caption ** Reconstruction Finance Corporation" comprehend all expenditures from funds of the Reconstruction Finance Corporation, including
those allocated to other organizations, whereas expenditures included in this table on account of such
allocated funds are exhibited*as expenditures of the organizations to which the-fuijds were allocated
tather than expenditures of the Reconstruction Finance Corporation. Similarly, certain expenditures of
the Farm Credit Administration, and the Commodity Credit Corporation, representing funds allocated to
thoserorganizations for the purpose ot carrying out the'l)rovisions: of the Agricultural; Adjustmen^t'Act, are
exhibited'in the daily Treasury statement under the caption-" Agricultural Adjustment Administration,"
whereas such expenditures are exhibited in this table as expenditures of the Farm Credit Administration
and the Commodity Credit Corporation, respectively. The total amount of expenditures for the fiscal
year 1935 in this table can be reconciled with the total amount of emergency expenditures shown in the
daily Treasury statement by adding to the latter the amounts included in general expenditures under the
captions "Agricultural Adjustment Administration," "refunds of receipts—processing tax on farm
products," and "Subscriptions to stock of Federal land banks," and deducting the receipts under the caption "Processing tax on farm products."

EEPOET OF THE SECEETAEY OF THE TEEASUEY

2 The emergency expenditures included in this table for the period prior to the fiscal year 1934 include
only expenditures on account of the Reconstruction Finance Corporation and subscriptions to capital stock
of Federal land banks under authority of the act of Jan. 23, 1932. Expenditures by the several departments and establishments for public works under the Emergency Relief and Construction Act of 1932 were
made from general disbursing accounts, and, therefore, are not susceptible to segregation from the general
expenditures of such departments and establishments on the basis of the daily Treasury statement.
' Includes (a) $350,000,000 speciflc appropriations from the general Treasury under the acts of May 12,
1933, May 25, 1934, and June 19, 1934; (6) $1,324,885,000 advanced by the Secretary of the Treasury under
authority of sec. 12 (6) of the Agricultural Adjustment Act, which must be returned to the Treasury from
the proceeds of processing taxes collected on farm products: (c) $1,753,795 advanced by the Secretary of the
Treasury under authority of sec. 10 (a) of the act of June 28,1934; and (d) $8,000,000 allocated from processing taxes for purchase of surplus sugar under the act of May 9,1934; less $758,613 transferred to the Division
of Disbursement, Treasury Department.
. 4 There are no statutory limitations on the amounts of funds which may be made available by the Reconstruction ^Finance Corporation for carrying out the purposes of sec, 5 of the Agricultural Adjustment,
Act, and for thei purchase by the Reconstruction Finance Corporation of preferred stock or capital notes
of banks and trust companies.under the act of Mar..9, 1933. The Reconstruction Finance Corporation is
required to make available to the Federal Housing Administrator such funds as he may deem necessary
for the purposes of carrying out the provisions of the National Housing Act. The amounts included in this
column for the purposes specified are based upon checks issued therefor from time to time by the Reconstruction Finance Corporation. The authority of the Reconstruction Finance Corporation to issue its
bonds, notes, and debentures has been increased by such amounts as may be required to provide funds
for such purposes.
fl The sum of $8,000,000 of this amount has been allocated for the purchase of surplus sugar under the act
of May 9, 1934. The remainder is reserved to reimburse the Treasury for the advances referred to in
footnote 3.
8 Excess of processing tax, deduct.
7 Expenditures are stated on a net basis; i, e., gross expenditures less repayments and collections, the
details of which are set forth in the table following.
8 Net, after deducting repayments to the Reconstruction Finance Corporation.
9 Excess of credits, deduct.
10 Less than $500,000.
11 The appropriation of $950,000,000 provided in the act of Feb. 15, 1934, was allocated by the President as follows: Civil Works Administration, $345,000,000; and Federal Emergency Relief Administration,
$605,000,000.
12 Under the provisions ofthe Emergency Appropriation Act, flscal year 1935, the Reconstruction Finance
Corporation is authorized to purchase marketable securities acquired by the Federal Emergency Administration of Public Works, but the amount which the Reconstruction Finance Corporation may have
invested at any one time in such securities may not exceed $250,000,000. Moneys paid for such securities
are available for loans (but not grants) under title II of the National Industrial Recovery Act. The amount
of .obligations :w^hich the Reconstruction Finance Corporation is authorized to have outstanding at any one
tirne is increased by the sums necessary for such purchases, not to exceed $250,000,000. The purchase of
such securities by the Reconstruction Finance Corporation is reflected as expenditures of the Reconstruction Finance Corporation and as credits against expenditures of the Federal Emergency Administration
of Public Works. The amount by which the available funds on account of such transactions has been
increased is, therefore, included in the funds of the "Reconstruction Finance Corporation—direct loans
and expenditures."
13 Includes $500,000 allocated for savings and loan promotion as authorized by sec. 11 of the act of Apr. 27,
1934.
1* The appropriation of $500,000,000 for subscription to capital stock is included in the figures shown in the
column for Reconstruction Finance Corporation.
'•
'« Under sec, 3 of the act of June 16, 1934, the Reconstruction Finance Corporation is authorized to purchase at par obligations of the Federal Deposit Insurance Corporation in a face amount of not to exceied
$250,000,000, and the amount of obligations which the Reconstruction Finance Corporation is authorized
to have outstanding at any one time is increased by $250,000,000. The amount to be included in this column
will represent the proceeds deposited with the Treasurer of the United States on account of the sale of such
obligations by the Federal Deposit Insurance Corporation to the Reconstruction Finance Corporation.
19 This ampunt represents the unallocated balance of an allocation of $400,000,000 by the President to
the Administrator of Public Works. As and when such funds are allocated by the Administrator to
specific projects, the amounts are transferred from an unallocated status to an allocated status. ,

Details of revolving funds, fiscal year 1935, included in the table on page 28
fin millions of dollars]

Organization

Commodity Credit Corporation
Farm Credit Administration
Loans to railroads ^
.
Loans and grants to States, municipalities, etc.2
Reconstruction Finance Corporation—direct loans and expenditures
Export-Import Banks of Washington

Payments

190
334
141
159
1,179
5

Repayments
and
collections
250
193
75
21
1,314

Net
expenditures

1 60
141
66
138
I 135
• 3

1 Excess of repayments and collections, deduct.
,2 Eft'ective Apr. 18, 1935, figures relating to "Loans to railroads'' have been segregated from those relat ng to "Loans and grants to States, municipalities, etc."

REPORT OF THE SECEETAEY OF THE TEEASUEY
REVENUE LEGISLATION

Revenue legislation during the fiscal year 1935 included the extension for two years of the temporary taxes and of the increased postal
rates provided for in the Revenue Act of 1932, as amended; an
amendment to the Revenue Act of 1934 relating to publicity of income
tax returns; and additions to agricultural adjustment taxes.
Extension oj temporary taxes and increased postal rates
Public Resolution No. 36, approved June 28,1935, amended the Revenue Act of 1932, as amended, by substitution of ^^1937" for ^ ^ 9 3 5 "
wherever it appeared in title IV, and parts I, I I , I I I , and IV of title
V. The taxes whicih were continued in effect until June 30 or July 31,
1937, by this legislation include: (1) the various manufacturers' excise
taxes; (2) taxes on the importation of coal, petroleum and products,
lumber, and copper; (3) the miscellaneous taxes on telegraph, telephone, radio, and cable facilities, transportation of oil by pipe hne, and
stamp taxes on bond transfers and deeds of conveyance; (4) the
changes in rates of stamp taxes on issues of bonds of indebtedness,
issues of capital stock, transfer or sale of capital stock, and sale of
produce on exchanges for future delivery; and (5) the reduced exemption for the tax on admissions. The increase in first class postage
rates, and authorization for the President to proclaim modification
of certain postage rates, were continued in effect until June 30,
1937, by the same resolution.
A copy of Public Resolution No. 36 is shown as exhibit 43 on
page 266.
Publicity oj income tax returns
Public No. 40, approved AprU 19, 1935, substituted for section
55 (b) of the Revenue Act of 1934, which provided that certain iteini
from income tax returns should be avaUable for public inspection, a
new section providing that, subject to regulations made by the Commissioner of Internal Revenue with the approval of the Secretary of
the Treasury, all income returns filed for any taxable year beginning
after December 31, 1934, shall be open, upon the written request of
the Governor of a State, to inspection by any official, body, or commission, lawfully charged with the administration of any State tax
law, if the inspection is for the purpose of such administration or for
the purpose of obtaining information to be furnished to local taxing
authorities. A copy of Public, No. 40 appears as exhibit 42 on page 266.
Revision and extension oj agricultural adjustment taxes

. •> •

The Agricultural Adjustment Act, as amended, provides for thefollowing types of taxes: (1) A tax upon the first domestic processing
of basic agricultural commodities with respect to which rental and

REPOET OF THE SECRETARY OF THE TREASUEY

benefit payments have been proclaimed, and of any commodity found
and proclaimed by the Secretary of Agriculture to be competing to the
disadvantage of the processors or producers of any basic commodity;
(2) a tax upon floor stocks of any article processed wholly or in chief
value from any commodity with respect to which a processing tax
is imposed, which are held at the time the processing tax becomes
effective or the rate is increased; and (3) a compensating tax upon
the importation, during the period when a processing tax is in effect
with respect to any commodity, of articles processed wholly or partly
from that commodity.
At the beginning of the fiscal year 1935, processing taxes, floor
stocks taxes, and import compensating taxes were already in effect
with respect to the following basic agricultural commodities specified
in the act, as amended—wheat, cotton, tobacco, field corn, hogs,
sugar beets and sugar cane; and similar taxes had been imposed
upon certain paper products, jute fabric and jute yarn which were
found to be competing to the disadvantage of cotton processors.
Taxes had also been imposed by the act of April 21,1934 (Public No.
169) upon the ginning, in excess of an allotment, of cotton harvested
during the crop year beginning June 1, 1934; and by the act of June
28, 1934 (Public No. 483) upon the first bona fide sale of certain
tobacco harvested thereafter and prior to May 1, 1935, for which
tax-payment warrants to the extent of an allotment had not been
issued.
During the fiscal year 1935, in addition to these taxes, which continued in effect, processing and import compensating taxes on peanuts
became effective October 1,1934, as a result of the proclamation by the
Secretary of Agriculture of rental and benefit payments with respect
to peanuts. A proclamation of the President eliminated the initial
floor stocks tax in this case. The taxation of rice under the Agricultural Adjustment Act was stipulated by Public No. 20, approved
March 18, 1935, which provided that processing and import compensating taxes with respect to rice become effective AprU 1, 1935. The
cotton ginning tax was continued for the crop year beginning June 1,
1935, by requisite proclamations of the President and the Secretary
of Agriculture issued under authority of the act of April 21, 1934.
The tobacco sales tax was continued in effect for the crop year beginning May 1, 1935, by a proclamation of the Secretary of Agriculture
issued under authority of the act of June 28, 1934.
Changes in rates of a number of agricultural adjustment taxes were
made during the fiscal year in accordance with the procedure provided
for in the acts imposing these taxes. A summary of the rates of processing tax w^hich have been applicable to each commodit}' since the enactment of the Agricultural Adjustment Act on May 12, 1933, and of
cotton ginning and tobacco sales tax rates since the imposition of these
taxes, together with effective dates, appears as exhibit 44 on page 267.
16816—36

REPORT OF T H E SECRETARY OF T H E TREASURY
ESTIIMATES O F R E C E I P T S AND E X P E N D I T U R E S

Actual receipts and expenditures for the fiscal year 1935 and estirnates for the fiscal years 1936 and 1937 are shown in the table below.
Estimated expenditures are based on the latest information from the
Bureau of the Budget. More detailed estimates of receipts are shown
in table 15, on page 357. All estimates of revenue are based on the
assumption that the existing tax structure will continue during the
period covered.
Total internal revenue (exclusive of agricultural adjustment taxes
and taxes imposed by the act to levy a tax upon carriers and upon
their employees, by the Bituminous Coal Conservation Act, and by
the Social Security Act) and customs receipts are estimated at
$3,660,000,000 (on Treasury statement basis) for the fiscal year 1936
and at $4,400,000,000 for the fiscal year 1937. Actual receipts from
these sources in the fiscal year 1935 were $3,100,000,000.
Receipts and expenditures for the fiscal year 1935, on the hasis of daily Treasury
siaiemenis {unrevised), and estimated receipts and ejpenditures for the fiscal years
• 1936 a,nd 1937
1935, a c t u a l

1936, e s t i m a t e s

1937, estimates

G E N E R A L AND SPECIAL ACCOUNTS
RECEIPTS

Internal revenue:
I n c o m e tax
Miscellaneous i n t e r n a l r e v e n u e
Processing tax on farm p r o d u c t s
o t h e r internal revenue:
T a x on carriers a n d their employees
B i t u m i n o u s Coal Conservation A c t
Social Security Act
Customs
•.Miscellaneous receipts:
Proceeds of G o v e r n m e n t - o w n e d securities:
Principal—foreign obligations
Interest—foreign obligations
Aiiother
P a n a m a C a n a l tolls, etc
' Seigniorage.'
.
O t h e r miscellaneous

099,118, 637.90 $1,434,112,000.00
657,191, 518. 70 1,873,091,000.00
521, 379.871. 22
529,042,000.00

$1, 942, 600,000.00
2,103,114,000.00
547,300,000.00

33,000,000.00
5, 600,000. 00
343, 353,033. 56

353,191,000.00

101,600,000.00
12, 300,000.00
433, 200,000.00
354,000,000.00

66, 709. 53
601,114. 48
^. 38,-105, 611.49
24, 704, 262. 38
58,035,251.37
•57,911,191.33

69, 898.00
324,871.00
79,-476,253; 00
24,890, .500.00
20,000,000.00
57,996,424.00

72,094.00
322, 365.00
62>-688,694.00
24,905,500.00
19,:000,^000.00
' 53,"114, 997.00

4,410,^793,946.00

5, 654V 217, 650.00

•3,800,'467,'201.1

Total.
EXPENDITURES

General:
D e p a r t m e n t a l : 12
Legislative e s t a b l i s h m e n t
E x e c u t i v e proper
State Department
Treasury Department
W a r .Department (nonmilitary)
D e p a r t m e n t of Justice
P o s t Office D e p a r t m e n t
D e p a r t m e n t of t h e Interior:
Boulder C a n y o n project
Other
D e p a r t m e n t of A g r i c u l t u r e : '
Public highways
Other
D e p a r t m e n t of C o m m e r c e
' D e p a r t m e n t of L a b o r
Shipping B o a r d . .
Jndei)endent.offices a n d commissions..
U'nclass'ified i t e m s . .

19, 623, 726. 95
457, 693. 77
15, 860, 779. 62
121, 863, 248. 67
2,128,302.12
32, 278, 677. 51
14,268.16

22, 021, 530.00
431, 650. 00
16, 984.167. 00
129, 580,000. 00
1, 588, 700. 00
35, 050,000. 00
^ 25,000. 00

23,603,977.00
431, 650.00
18, 762,000. 00
142, 886,100.00
1, 333, 000.00
40, 500, 000. 00
25,000.00

55,211,498.12

13.000, 000. 00
71,121, 200. 00

16, 600,000.00
111,525,400.00

30,000,000.00
75, 267, 400. 00
33, 654, 515. 00
15, 000, 500. 00
2, 748, 870.00
33, 772, 669. 00

64,000,000.00
103,116,896.00
33, 392, 500.00
24,185,000.00
138,900.00
86,190, 700. 00

474,748,461.00

666,413,323.00

62,036,811.90
32, 315, 736. 67
13,012,157.65
21,348,272.91
29, 473, 078. 57
'490,365. 40
362,408,815. 08

A d j u s t m e n t for disbursing officers'
outstanding....
Total, departmental s
F o r footnotes, see p . 35.

checks
.

6,416,302.83
355,992, 512. 25

EEPOET OF T H E SECEETAEY OF THE TEEASUBY

Receipts and expenditures for ihe fiscal year 1935, on the hasis of daily Treasury
statements {unrevised), and estimated receipts and expenditures for the fiscal years
1936 and i ^57—Continued
1935, a c t u a l

1936, e s t i m a t e s

1937, e s t i m a t e s

ETrpENDiTURES—continued
General—Continued.
P u b l i c buildings i
River and harbor work i
P a n a m a Canal i
P o s t a l deficiency
R e t i r e m e n t funds ( U n i t e d States s h a r e ) :
Civil service r e t i r e m e n t fund
Foreign service r e t i r e m e n t fund
C a n a l Zone r e t i r e m e n t fund
D i s t r i c t of C o l u m b i a ( U n i t e d States s h a r e ) . . N a t i o n a l defense: i
Army
Navy
V e t e r a n s ' pensions a n d benefits:
Veterans' Admimstration i
Adjusted-service certificate fund
A g r i c u l t u r a l Ad.iustment A d m i n i s t r a t i o n ^ . . .
A g r i c u l t u r a l A d j u s t m e n t .Administration (act
A u g . 24, 1935)
-F a r m Credit Admimstration i
E m e r g e n c y Conservation W o r k .
T e n n e s s e e Valley A u t h o r i t y
D e b t charges:
Retirements:
' Sinking f u n d . .
R e d e m p t i o n of b o n d s , e t c . . P u b l i c
Works Administration
E s t a t e taxes, forfeitures, gifts, etc
Interest
Refunds:
Customs
Internal revenue
Processing tax on farm p r o d u c t s
To.tal, general.
R e c o v e r y a n d relief:
.Agricultural aid:
-Agricultural A d j u s t m e n t
Administration
C o m m o d i t y C r e d i t Corporation:
Reconstruction F i n a n c e Corporation
funds
Other..
F a r m Credit Administration:
Recoristruction'Finance'Corporation
funds:
C r o p p r o d u c t i o n loans
* • R e g i o n a l . a g r i p u l t u r a l . c r e d i t corporations
.L o a n s to joint-stock l a n d b a n k s . .
F a r m mortgage relief
Federal F a r m M o r t g a g e Corporation
Federal
intermediate
credit
b a n k s revolving fund
F a r m Credit Administration
Unclassified
Other..
Federal l a n d b a n k s :
Capital stock
Subscriptions to paid-in s u r p l u s
R e d u c t i o n in interest rates on
mortgages
Relief:
Federal E m e r g e n c y Relief A d m i n i s t r a tion, including F e d e r a l S u r p l u s Relief
Corporation:
R e c o n s t r u c t i o n F i n a n c e Corporation
funds.Other
F o r footnotes, see p 35.

$25, 269, 072. 94
55,118, 567. 21
8, 766, 204. 74
63, 970, 404. 80

$14, 612, 200. 00
74, 207, 400. 00
11,189, 500. 00
90, 652, 054. 00

$49, 300, 000. 00
139, 777, 000. 00
11, 294, 500. 00
78, 909,149. 00

20, 850, 000. 00
159,100. 00
4, 539, 295. 00

40, 000, 000. 00
162, 400. 00
500, 000. 00
5, 707, 500. 00

46, 050, 000. 00
185, 300. 00
500, 000. 00
5, 700, 000. 00

212,186,712.61
321, 410, 530. 43

319, 489, 088. 00
425, 350, 500. 00

369,919,566.00
567,872, 400. 00

555, 573, 274. 31
50, 000, 000. 00
561, 540, 268. 39

617,822,280.00
100, 000, 000. 00
508, 014,000. 00

630,058, 900. 00
160, 000, 000. 00
507,052, 000. 00

12, 979, 061. 00

20, 000, 000. 00
10, 755, 382. 00
25, 000,000. 00
20, 398, 386. 00

i73, 001, 000. 00

551, 000,000. 00

580, 000, 000. 00

557, 250. 00
820, 926, 353.45

1, 000, 000. 00
25,000 00
742, 000, 000. 00

100, 000. 00
25, 000. 00
805, 000, 000. 00

20, 715, 688. 49
24, 531, 990. 82
31, 208, 208. 32

13, 500, 000. 00
33, 603, 000. 00
23, 000, 000. 00

17, 000, 000. 00
32, 403,100. 00
42, 000, 000. 00

3, 719, 295, 494. 76

4,122, 737,151. 00

4, 999, 486, 738. 00

150, 278,834. 56

70,113, 000.00

50, 295,000. 00

60,280,486.04
136,420.18

154,498,000.00
7,000,000. 00

161,346,900.00
4,000,000.00

20, 000, 000.
4, 926, 500.
220, 000, 000.
45, 000, 000.

00
00
00
00

4,383,977.67

375,000.00

615,000.00

8, 603, 628.15
904,326.15
1'34. 78

28,313,000.00
285,860.00

14,528,600.00
93, 600. 00

15,000,000.00
11, 248,180.18
110,000.00
111,827,178.61

S3,060,000. 00

9,666,000.00

1,939,140.00
33,630,185. 59

35,000,000.00

41,000, 000. 00

12,477,674.95

30,000,000.00

23,000,000. 00

'499,033,591.17
1,315,308,715.70

486,400. 00
423,865, 300. 00

265. 62

REPORT OF. T H E SECEETAEY OF T H E TEEASUEY

Receipts and expenditures for the fiscal year 1935, on the hasis of daily Treasury
statements {unrevised), and estimated receipts and expenditures for the fiscal years
1936 and 7^57—Continued
1935, a c t u a l

1936, e s t i m a t e s

1937, estimates

EXPENDITURES—Continued
R e c o v e r y a n d relief—Continued.
Relief—Continued.
Civil W o r k s A d m i n i s t r a t i o n
E m e r g e n c y conservation w o r k
D e p a r t m e n t of Agriculture, relief.^.
Public works:
Boulder C a n y o n project
L o a n s a n d g r a n t s to States, m u n i c i p a l i ties, e t c . :
L o a n s to railroads
Public highways
River and harbor w o r k . . .
R u r a l Electrification A d m i n i s t r a t i o n
W o r k s Progress A d m i n i s t r a t i o n
Other public works:
Administrative
expenses.
Public
Works Administration
Legislative e s t a b l i s h m e n t
.
State Department
Treasury Department:
P u b l i c buildings -.
Other
W a r D e p a r t m e n t (nonmilitary)
N a t i o n a l defense:
Army
Navy
P a n a m a Canal
D e p a r t m e n t of J u s t i c e . .
D e p a r t m e n t of t h e Interior
D e p a r t m e n t of A g r i c u l t u r e
D e p a r t m e n t of C o m m e r c e
D e p a r t m e n t of L a b o r
Veterans' Administration
,..
I n d e p e n d e n t offices and commissions .
District of C o l u m b i a
Unclassified items
A i d to h o m e owners:
H o m e loan s y s t e m :
Reconstruction Finance Corporation
funds:
H o m e loan b a n k stock
—
H o m e O w n e r s ' L o a n Corporation.
Federal savings a n d loan associations.
E m e r g e n c y housing
Federal Housing Administration:
Reconstruction Finance Corporation
funds.
Other.
Resettlement Administration
Subsistence h o m e s t e a d s
Miscellaneous:
E x p o r t - I m p o r t B a n k s of W a s h i n g t o n :
Reconstruction Finance Corporation
funds
• Other..
Federal D e p o s i t I n s u r a n c e C o r p o r a t i o n . .
A d m i n i s t r a t i o n for I n d u s t r i a l R e c o v e r y . .
Reconstruction Finance C o r p o r a t i o n direct loans a n d e x p e n d i t u r e s
Tennessee Valley A u t h o r i t y
T o t a l , recovery a n d relief..

$11, 327, 263. 67
435, 508, 643. 05
80,561,249.99

15, 755,300.00

$9,100, 000. 00'

707,417. 46
230, 752. 95
356, 940. 05
924, 751. 64
16, 820. 93

52,450, 000. 00
40,000, 000. 00
276, 543,000. 00
150, 510, 000.00
5, 000, 000. 00
1, 000, 000,000. 00

325, 756,000.00

14, 561,002. 60
486,103.10
2, 659, 016. 08

20,000, 000. 00
1, 761, 500. 00
2,462, 700. 00

15,000,000.00636, 582. 00'

32, 756, 840. 70
5, 615,951. 73
1,488, 375. 48

60,167, 500. 00
26,194, 700. 00
640,300.00

' 43, 550,000. Oa
5, 755,000. 00.

61, 298, 999.11
115, 037, 329. 60
243, 541. 54
531, 703. 81
53,136, 034. 00
15, 722, 946, 75
10,197, 883. 69
6, 260, 630. 26
1,491 450. 37
4,490, 965. 39
957, 701. 03
418, 175.19

21,938,400. 00
138, 290, 600. 00
900.00
700, 000.00
77, 426,900. 00
50,045, 741.00
2, 766,805. 00
9, 795, 600. 00
2, 314, 620. 00
15, 229, 200.00

4,850,000. 0041,225,000. oa

200,000.00
46, 000,000. 00
29,486, 784. 08
6,479,835.47

43,095.300.00

15,046,858. 01
917, 015. 01
1,761, 663. 06
3, 661,937. 71

14,000,000.00
82,985. 00
73, 200,000.00
900,000,00

'i56,'6oo,'ooo."6o'

2,618,129. 74
1, 633.11
497, 850. 35
12, 496,730. 81

16,914, 000. 00
204, 582. 00

10,000,000. oo

136,384,933.68
36,148, 537. 34

216,000,000. 00
29, 601, 614. 00

126,000,000.00-

3, 656, 529, 670. 81

3,167, 564,187. 00

928,119, 632. OO

7,290,301,338.00
80,000,000.00

6,927, 606,370. OO
600,000,000. OO

275,000,000. 00

225,000,000. OO

7, 645, 301, 338. 00
3,234,507,392.00

6,752,606,370 00
1,098,388,720 00

23,820, 507. 04
137,
66,
317,
147,

T o t a l e x p e n d i t u r e s , general a n d special
accounts
7,375,825,165. 57
Supplemental items
Unallocated balance of emergency a p p r o p r i a tions as of Oct. 31, 1935, a n d a d d i t i o n a l
a m o u n t s m a d e available thereafter from
R e c o n s t r u c t i o n F i n a n c e Corporation funds.
G r a n d total, e x p e n d i t u r e s , general
special a c c o u n t s . .
Excess of expenditures over r e c e i p t s . .
F o r footnotes, see page 35.

$469,100. 00
603, 383,000.00
4, 238,000.00

14, 307,000. 00
49, 000,000. 00

236, 518, 000. 00'
84, 611,000.00
2, 500,000. 00'

57,820,100.00'
36, 719,800. 00
125, 750. OO
134,000. 00
64,500. oa
23, 698, 000. OO-

Ol, 000,000. 0020,000,000. OO

4, 236,000. 00

and
7,375,825,165. 57
3, 575, 357, 963. 61

EEPOET OF THE SECKETAEY OF T H E TEEASUEY

Receipts and expenditures for the fiscal year 1935, on the basis of daily Treasury
statements {unrevised), and estimated receipts and expenditures for the fiscalyears
1986 and i.957—Continued
1935, a c t u a l

1937, estimates

1936, e s t i m a t e s

Summary
$3, 575, 357,963. 61 $3, 234, 507, 392. 00
573, 558, 250. 00
552, 025, 000. 00

Excess of expenditures
Less p u b l i c d e b t r e t i r e m e n t s

$1, 098; 388. 720. 00
580,125,000. 00

Excess of expenditures (excluding p u b l i c d e b t
retirements)
T r u s t accounts, i n c r e m e n t on gold, etc., excess of
receipts (—) or expenditures ( + )

3, 001, 799, 713. 61

2, 682, 482. 392. 00

518, 263, 720.00

-522,056,152. 87

+290,173, 359. 00

+46,950, 769, 00

Less national b a n k note r e t i r e m e n t s

2,479, 743, 560. 74
91,415,650 00

2,972,655,751.00
4.50, 000, 000. 00

• 565, 214, 489. 00
100,000,000.00

T o t a l excess of expenditures (excluding
public-debt retirements)
Decrease in general fund balance _ _

2, 388, 327, 910 74
740, 576, 700. 69

2, 522, 655, 751. 00
290.173, 359. 00

465, 214,489. 00
46,950, 769. 00

1, 647. 751, 210 05 2, 232,482, 392. 00
27,053,141, 414. 48 28, 700, 892, 625. 00

418, 263,720.00
30,933, 375. 017. 00

28, 700, 892, 624. 53 30,933,375,017.00

31, 351, 638, 737. 00

Increase in t h e public d e b t
P u b l i c d e b t a t beeinning of year

. .

P u b l i c d e b t at end of y e a r .
T R U S T ACCOUNTS, INCREMENT ON G O L D , E T C .
RECEIPTS

T r u s t accounts
Deposits b y States u n d e r Social Security A c t
(title I X , sec. 904 (a))
I n c r e m e n t resulting from reduction in t h e weight
of t h e gold dollar
Seigniorage *
Total..

229,660, 234,35

237,935,409. 00

237, 550,685.00

48, 500,000.00

282,800,000.00

1, 738,019. 63
140, 111, 441. 47

169,888, 559. 00

371, 509, 695. 45

456, 323,968. 00

165,959, 662. 87

233, 377, 430. 00

224, 501, 454. 00

48, 500, 000. 00

282, 800, 000. 00

429,528,749. 66

4,528,750 00

10, 000, 000. 00

675,121.93

391,147. 00

20,931, 857. 34
91, 415, 650 00

9, 700,000. 00
450, 000, OOO 00

9,700, OOO 00
100, 000,000.00

150,646,467.42

746,497,327. 00

627, 301,454. 00

290,173,359. 00

46,950,769.00

60, 000,000. 00
'

580, 350, 685. 00

EXPENDITURES

T r u s t accounts
Deposits b y States u n d e r Social Security A c t
(title I X , sec. 904 ( a ) ) .
T r a n s a c t i o n s in checking accounts of governm e n t a l agencies (net) *
:
C h a r g e a b l e against i n c r e m e n t on gold:
M e l t i n g losses, etc
P a y m e n t s t o Federal Reserve b a n k s (sec. 13b,
Federal Reserve Act, as a m e n d e d )
F o r r e t i r e m e n t of national b a n k notes
Total..,
Excess of receipts over expenditures
Excess of expenditures ovei* r e c e i p t s . . .

300,000.00

522,056,152. 87

1 Additional expenditures on these accounts for the fiscal year 1935 are' included under "Recovery and
relief.";
2 Detail on basis of checks issued,
3 The Executive order of June 10, 1933, as amended, provides for the transfer of the function of disbursement of all moneys of the United States (except those relating to the Mihtary and Naval Establishments,
rivers and harbors, and Panama Canal) to the Division of Disbursement, Treasury Department, The
transfer of such functions in Washington, D, C , of the several departments and establishments subject
to the Executive order of June 10, 1933, was completed on July 1, 1934. Therefore, effective July 1, 1934,
in the interest of economy and efficiency, the disbursements by the Division of Disbursement, Treasury
Department, which appear in daily Treasury statements under the caption "Departmental Expenditures'.'
are on the basis of checks issued. The total shown, after making adjustment for outstanding checks of
the .Division of Disbursement, relating to such "Departmental Expenditures" is on the basis of checks
paid as published heretofore.
* This item represents seigniorage resulting from the issuance of silver certificates equal to the cost of
the silver acquired under the Silver Purchase Act of 1934 and the amount returned for the silver received
under the President's proclamation dated Aug. 9, 1934.
* This item represents transfers of balances in checking accounts of certain special agencies of the Government, net transactions in which will hereafter be shown under this caption.
NOTE,—Excess credits and adjustments in italics to be deducted.

EEPOET OF THE SECRETAEY OF THE TEEASUEY

A large part of the estimated increases in receipts from these sources
in 1936 and 1937 reflects estimated higher income tax and estate
tax collections which, omng to the nature of the Federal tax structure,
do not promptly reflect improvements in business conditions. Current
income tax collections in a given fiscal 3^ear are based upon corporate
and individual incomes of the two preceding calendar years ending
with December of the flscal year. Current income tax collections
during the flscal year 1935, therefore, did not reflect until the second
half of that year either the higher levels of incomes of the calendar
year 1934 or the effect of the Revenue Act of 1934. During the full
flscal year 1936 the provisions of the Revenue Act of 1934 with respect
to income taxes will be effective, and in the last half of that year
collections will reflect the higher income levels of the calendar year
1935. Income tax collections during the last half of the flscal year 1937
will be based on the anticipated higher incomes of the calendar year
1936 and, moreover, will reflect the effects of the Revenue Act of
1935. Estimated estate tax collections in the flscal years 1936 and
1937 are based upon the estimated higher values of estates in the
fiscal years 1935 and 1936, respectively, and in the last 7 months of
1937 will also reflect the upward revision in estate tax rates and
the lowered speciflc exemption under the Revenue Act of 1935.
Fiscal year 1936
Total internal revenue and customs receipts (on Treasury statement basis) are estimated at $4,228,000,000 in the flscal year 1936, an
increase of $607,000,000 over such receipts of the flscal year 1935. Of
this increase, it is estimated that $551,000,000 mil come from higher
income tax and miscellaneous internal revenue receipts. The balance
of the increase reflects a moderate increase in receipts from agricultural adjustment taxes and customs duties, and also from the taxes
imposed by the act to levy a tax upon carriers and upon their,employees and by the Bituminous Coal Conservation Act which will be
collected for the first time during the last half of the flscal year 1936.
Current corporate income taxes are estimated to yield $615,000,000,
an increase of $150,000,000 over collections of the flscal year 1935.
Collections from current individual income taxes are estimated at
$629,000,000, an increase of $181,000,000 over collections in the
preceding flscal year. The estimated increase in income tax collections in 1936 reflects the higher level of incomes upon wliich they are
based and also the effect of the Revenue Act of 1934 which will be
fully reflected in collections for 1936.
The continued special efforts of the Bureau of Internal Revenue to
collect back taxes and the change in the Treasury's administration of
depreciation allowances are expected to increase collections from that
source by about $4,000,000 over the relatively high collections during
the flscal year 1935.

REPORT OF THE SECEETAEY OP THE TEEASUEY

Total miscellaneous internal revenue taxes are estimated to yield
$1,873,000,000 (on Treasury statement basis), an increase of $216,000,000 as compared with receipts in the fiscal year 1935. Practically
all sources of miscellaneous internal revenue are expected to contribute
to this increase.
Estate tax collections are estimated to increase by $51,000,000,
reflecting an increase in the value of taxable estates of decedents
during the fiscal year 1935 and, for the first time, the full effect of the
upward revision in estate tax rates under the Revenue Act of 1934.
Gift tax collections, which in 1935 were almost eight times as large as
those of the fiscal year 1934 owing, at least in part, to a large amount of
gifts probably made in anticipation of higher income and estate tax
rates, are expected to continue at a'relatively high level since it seems
probable that a large amount of gifts were made in the calendar year
1935 because of the same factors.
Revenues derived from taxes on alcoholic liquors are estimated to
increase $92,000,000 in 1936, reflecting mainly the upward trend in
consumption of tax-paid distilled spirits because of improving quality,
lower prices, enforciement activity, and increasing incomes. Tobacco
tax collections are expected to show a moderate increase owing to an
estimated increase in the consumption of small cigarettes. The estimated increase of $24,000,000 in documentary stamp tax collections
reflects estimated increases in refunding of security issues and greater
activity in- trading on stock exchanges. Collections from the manufacturers' excise taxes are also expected t o increase moderately, chiefly
as the result of anticipated higher collections from the taxes on motor
vehicles and gasoline. The decrease resulting from the repeal of the
tax on checks effective January 1, 1935, which yielded $26,000,000
during part of the flscal year 1935, will more than offset estimated
increases in collections from certain other miscellaneous taxes.
Revenue from taxes imposed • under the Agricultural Adjustment
Act and related legislation are estimated at $524,000,000 (on collection basis), or $2,000,000 less than collections in the fiscal year 1935.
Estimated increases in collections from the processing taxes on wheat,
cotton, peanuts, and the new taxes on rice and rye will be more than
offset by decreases in the processing taxes collected on hogs, sugar,
and tobacco. The expected lower collections from the taxes on tobacco
are due to a reduction in rates on that commodity effective October 1,
1935. The 1936 estimates assume the continuance and collection of
these taxes in their present form and do not take into account the
effect of court injunctions restraining the collection of these taxes.
The act to levy an excise tax upon carriers and an income tax
upon their employees imposes an income tax of 3K percent of the
compensation (not in excess of $300 per month) of each employee,
as defined by the act, and an excise tax on carriers equal to 3K percent
of the compensation (not in excess of $300 per month) paid by them

EEPOET OF THE SECEETARY OF THE TREASUEY

to their employees. The taxes become effective March 1, 1936, and
only one quarterly payment in the estimated amount of $33,000,000
wiir be received from these taxes during the fiscal year 1936.
The Bituminous Coal Conservation Act, approved August 30,
1935, levies a tax of 15 percent on the sale price of bituminous coal at
the mine, with the provision that coal producers who accept the Bituminous Coal Code shall be entitled to a credit of 90 percent of the
amount of the tax. It is estimated that abput $6,000,000 will be
collected from this tax during the latter part of the fiscal year 1936
Total customs receipts (on collection basis) are estimated at $352,000,000, an increase of $7,000,000 over collections in the fiscal year
1935. Duties collected on imported distilled spirits and wines are
expected to decline by about $8,000,000 largely because of improvement in the domestic product and of the effect of the reduction in
duty on whisky, aged 4 years or more, from $5 per proof gaUon to
$2.50 per proof gallon under the Canadian trade agreement effective
January 1, 1936. Collections of duties on other commodities are
estimated to increase by about $15,000,000 over collections of the
preceding fiscal year.
. Total receipts from miscellaneous revenues and the realization
upon assets are estimated at $183,000,000, an increase of about
$4,000,000 over receipts of the fiscal year 1935.
Fiscal Year 1937
Total receipts from internal revenue taxes and customs duties for
the fiscal year 1937 are estimated at $5,494,000,000, an increase of
$1,266,000,000 over estimated receipts frorn these sources (on Treasury statement basis) for the fiscal year 1936. Of this increase,
$433,000,000 is estimated to come from taxes imposed by the Social
Security Act which will be collected for the first time in the last half of
the fiscal year 1937, and $75,000,000 from increased collections from
taxes imposed by the act to levy a tax upon carriers and upon their
employees and by the Bituminous Coal Conservation Act. Total
internal revenue and customs receipts exclusive of these items are estimated at $4,947,000,000, an increase of $758,000,000 over the estimate
for 1936 and of $1,326,000,000 over actual collections from these
sources in the fiscal year 1935.
Total income tax collections are estimated at $1,943,000,000, an
increase of $509,000,000 over the estimate for 1936. Of this increase,
estimated current corporation and current individual income tax
collections account for $212,000,000 and $307,000,000, respectively.
The major part of these estimated increases will occur in the second
half of the fiscal year 1937, reflecting the anticipated higher incomes
of the calendar year 1.936 as compared with 1935 and, for the flrst
time, the effects of the Revenue Act of 1935. The major provisions

REPORT OF THE SECRETAEY OP THE TEEASURY

of that act affecting revenue from income taxes based on incomes for
calendar years beginning subsequent to December 31, 1935, include:
Corporations, the substitution of a graduated tax (except in the case
of railroad corporations which continue having the privilege of flling
consolidated returns) ranging from 12^ percent on net income not in
excess of $2,000 to 15 percent on net incomes in excess of $40,000 for
the single rate of 13% percent in effect under the Revenue Act of
1934, the allowance of only 90 percent of dividends received from
domestic corporations as a deduction from gross income, and an
increase in rates of tax on personal holding companies; individuals,
increased surtax rates on surtax net incomes in excess of $50,000, the
graduated rates ranging up to 75 percent on surtax net incomes in
excess of $5,000,000. as compared with a maximum rate of 59 percent
on surtax net incomes in excess of $1,000,000 under the Revenue
Act of 1934. It is estimated that the increased revenue from current
corporate and individual income taxes in the last half of the flscal
year 1937 due to the Revenue Act of 1935 wiU be $42,000,000 and
$62,000,000, respectively. Collections from back taxes on incomes
are estimated to be $180,000,000 or $10,000,000 less than for the
flscal year 1936.
Total miscellaneous internal revenue collections are estimated at
$2,103,000,000, an increase of $230,000,000 over the 1936 estimate
(on Treasury statement basis).
Collections from the capital stock and excess-proflts taxes are estitimated to be $66,000,000 greater than the 1936 estimate. This increase is entirely due to the Revenue Act of 1935. Under that act
the rate of tax on capital stock was increased from $1 to $1.40 per
$1,000 of the adjusted declared value. The rate of tax on excess
proflts was changed from 5 percent under the Revenue Act of 1934
upon net incomes in excess of 12}^ percent of the adjusted declared
value of capital stock to 6 percent of net income in excess of 10 percent
and not in excess of 15 percent of adjusted declared value, and 12
percent on net income in excess of 15 percent of adjusted declared
value. In consequence of the changes in excess-proflts tax provisions,
corporations are expected to declare a higher capital stock valuation
than under the 1934 act. The increase in the capital stock valuation
and the higher rate of tax form the basis for the estimated increase
in revenue.
Estate tax collections are estimated to increase $77,000,000 over
the 1936 estimate reflecting the estimated higher taxable value of
estates and beginning in December 1936, the effect of the Revenue
Act of 1935. Under that act the graduated additional estate tax
rates imposed by the Revenue Act of 1932, as amended by the Revenue
Act of 1934, were increased to a maximum rate of 70 percent on net
estates in excess of $50,000,000 and the. speciflc exemption was reduced

EEPOET OP THE SECEETARY OF THE TEEASUEY.

from $50,000 to $40,000. The 1935 act provided further that the
estate tax imposed under its provisions shall be due and payable 15
months after a decedent's death and that the executor has the option,
with certain exceptions, to report the value of the gross estate as of
the date of the decedent's death or one year after death.
Gift tax collections are estimated to decline by about $35,000,000
from the 1936 estimate, based on the assumption that gifts made in
the calendar year 1936 will be in smaller amounts. Collections in
the last half of the flscal year 1937 will be under provisions of the
Revenue Act of 1935 which increased the graduated rates of tax on
gifts and decreased the speciflc exemption of $50,000, allowed under
the 1932 and 1934 revenue acts, to $40,000. I t is estiniated that
the changed provisions in the Revenue Act of 1935 with respect to
estates and gifts will provide $52,000,000 additional revenue in the
fiscal year 1937.
The upward trend in the consumption of alcoholic liquors and
tobacco manufactures, chiefly small cigarettes, is expected to continue
during the fiscal year 1937 and collections from these sources are
estimated to increase by $52,000,000 and $26,000,000, respectively,
over the 1936 estimates. Collections from the manufacturers' excise
taxes and miscellaneous taxes are also estimated to increase moderately.
Total agricultural adjustment taxes are estimated at $547,000,000,
an increase of $23,000,000-over the estimate (on collection basis) for
1936, chiefly because of estimated increases in consumption of cotton,
wheat, and hog products. As in the case of the 1936 estimate, the
estimate for 1937 assumes the continuance of existing taxes and
rates of tax.
Collections from the taxes imposed by the act to levy a tax upon
carriers and their employees are estimated at $102,000,000, an increase of $69,000,000 over the estimate for 1936. Since the act provides that these taxes shall terminate on February 28, 1937, the 1937
estimate provides for only three quarterly payments of this tax. The
tax imposed by the Bituminous Coal Conservation Act is estimated
to yield about $6,000,000 more than the 1936 estimate as the result
of a full year's collection from this tax in 1937.
The Social Security Act, approved August 14, 1935, provides for
two types of taxes which will be reflected in receipts during the last
half of the flscal year 1937. Title VIII of that act imposes with respect to employment (a) an income tax on wages (not in excess of
$3,000 per year) of every individual (excluding certain occupational
groups and persons 65 years of age and over) and (6) an excise tax on
each employer equal to certain percentages of wages paid by him with
the same salary limit and occupational and age exclusions. The rates
of tax with respect to each of these taxes will be 1 percent during the

REPOET OP THE SECRETARY OF THE TREASURY

calendar years 1937, 1938, and 1939, with rates increasing in subsequent years to a maximum of 3 percent after December 31, 1948.
I t is estimated that $305,000,000 wiU be,collected under title V I I I
during the last half of the flscal year 1937.
Title I X of the Social Security Act imposes an excise tax upon employers of eight or more persons (with certain occupational exclusions).
The rates of tax range from 1 percent on wages with respect to em^ployment during the calendar year 1936 to 3 percent after December 31,
1937. The taxpayer is allowed a credit for all contributions paid into
State unemployment funds not in excess of 90 percent of the tax. If
all States had adopted approved unemployment compensation systems by the beginning of 1936, the Federal Government would receive
in January 1937 an amount equal to 1/10 of 1 percent of the total
taxable pay roll. Inasmuch as it is improbable that all States will
adopt approved systems before January 1, 1937, and since the law
requires that the entire tax shall be paid to the Federal Government in
cases where States have not adopted approved systems, the estimate
of $128,000,000 from Federal collections of this tax during the latter
part of the fiscal year 1937 is larger than it would be with complete
State coverage.
Total customs receipts estimated at $354,000,000 are at about the
same level as the 1936 estimate. Collections from duties on distilled
spirits and wines axe expected to decline $6,000,000 from the 1936
estimate chiefly as the result of the reduction in duty on whisky, aged
4 years or more, under the Canadian trade agreement. Revenue
from other dutiable imports is estimated to increase $8,000,000 over
the estimate for 1936.
Miscellaneous receipts are estimated at $160,000,000, a decrease
of $23,000,000 from the estimate of the preceding fiscal year.
SILVER, SILVER CERTIFICATES, AND NATIONAL BANK NOTES

Silver
The Executive order ,of August 9, 1934, required that all silver
situated in the continental United States on August 9, 1934, with
certain stipulated exemptions, be delivered to the United States mints
within 90 days. The proclamation of August 9, 1934, directed the
United States mints to receive for coinage or for addition to the monetary stocks of the United States any silver which the mint is satisfied
was situated on August 9, 1934, in the continental United States,
including the Territory of Alaska. For silver so received the United
States mints were to return to the depositor an amount equal to
50.01 cents per fine troy ounce. The provisions of the proclamation
were supplementary to the proclamation of December 21, 1933, with
respect to the coinage of silver.

REPORT OF THE SECRETARY OP THE TREASURY

On November 2, 1934, the Executive order of August 9, 1934, was
amended so as to exempt permanently from the requirement of
delivery thereunder sUver which at the close of business on November
7, 1934, fell within certain stated categories.
Regulations were issued on July 5, 1934, relating to the exportation of silver, and on August 17, 1934, relating to the importation,
dealing in, and exportation of silver. Regulations relating to newlymined silver were issued on April 16 and May 15, 1935.
On AprU 10, 1935, the President amended the proclamation of
December 21, 1933, as amended, by increasing the amount returnable
by the United States mints and assay offices to producers of domestic
sUver mined on or after April 10, 1935, from the equivalent of 64.64
cents per ounce to the equivalent of 71.11 cents per ounce. On
April 24, 1935, the amount returnable with respect to such silver
mined on or after AprU 24, 1935, was further increased to 77.57 cents
per ounce.
On May 20, 1935, the Secretarj^ of the Treasury, with the approval
of the President, issued an order prohibiting, with certain exceptions,
the importation into the continental United States of foreign sUver
coins and other conventional, pieces or forms of silver commonly used
in any foreign country as money or coin. In accordance with this
order the silver regulations of August 17, 1934, as amended, were
further amended.
Acquisitions of silver by the Treasury from all sources during
the fiscal year were 437,798,807 ounces, at a cost of $232,435,879.
Under the proclamation of December 21,1933, as amended, 30,863,349
ounces were received; 112,301,335 ounces were received under the
proclamation of August 9, 1934; 293,737,702 ounces were purchased
under the authority of section 3 of the Silver Purchase Act of 1934;
and 896,421 ounces were received in deposits of gold bullion and in
exchange for Government stamped bars. It is estimated that the
total acquired was 12 times as much silver as was produced in the
United States in the same period, 17.5 times as much of that production as was available for monetary use, 2,2 times the total world
production, and 2.9 times the current world output avaUable for
monetary use.
The proclamations and orders issued during the fiscal year with
respect to silver appear as exhibit 38, page, 256. '
Silver certijicates
The Gold Reserve Act of 1934 authorized the President to issue
sUver certificates ^^ against any silver bullion, silver, or standard
sUver dollars in the Treasury not then held for redemption of any
outstanding silver certificates." Under this act, silver certificates

REPORT OP THE SECRETARY OF THE TREASUEY

became issuable against any unencumbered sUver in the Treasury
irrespective of the authority under which the sUver was received. I t
was decided, therefore, to provide a single or consolidated series of
sUver certificates for issuance against any free silver held in the
Treasury
This series of new silver certificates has been given the
designation, Series of 1934. The issuance of silver certificates of this
series was begun on August 7, 1934. During the remainder of the
fiscal year $422,488,000 of these certificates were issued and
$91,276,072 redeemed.
In a series of orders (summarized in the letter of the Secretary of
the Treasury to the President, September 10, 1934, approved by the
President September 12, 1934, and supplemented by the letters of
the Under Secretary of the Treasury to the Treasurer, March 1 and
April 5, 1935), the issuance and maintenance as part of the money circulation of the United States of silver certificates were authorized and
directed in a face amount equal to the total of the followiog items:
(a) The amount of sUver doUars held by the Treasury.
(b) $80,000,000, being an amount approximately equal to the
monetary value of all of the silver bullion in the Treasury on June 14,
1934, not then held for redemption of any outstanding silver certificates. This amount does not include sUver held in the stabilization
fund on June 14, 1934.
(c) $1,560,000, being the amount of silver certificates of the series
of 1933 outstanding on March 12, 1934 (including those held in the
Treasurer's cash). Silver certificates of the series of 1934 wUl be
issued in lieu of silver certificates of the series of 1933 as they are
redeemed or otherwise received into the Treasury and retired.
(d) A sum equal to the amount heretofore or hereafter returned to
the depositors for sUver received at the United States mints and assay
offices on and after June 15, 1934, whether under the proclamation
of December 21, 1933 (relating to newly-mined domestic silver), or
under the proclamation of August 9, 1934 (relating to the nationahzation of silver stocks).
(e) A sum equal to the cost of all silver heretofore or hereafter
purchased under the authority of section 3 of the Silver Purchase
Act of 1934, whether purchased from the stabilization fund or from
other sources.
Since there was a considerable reserve stock of silver certificates
of the series of 1928, the Treasurer was directed to issue them until
the stock was exhausted. The last of these certificates was issued
on July 6, 1935. On, June 30, 1935, the amount of silver certificates outstanding was $810,040,419, representing an increase of
$315,044,005 during the fiscal year.
Statements and official orders issued during the year relating to
silver certificates appear as exhibit 39, page 262.

REPORT OP THE SECRETARY OP THE TREASURY
o

National bank notes
Steps were taken during the year which will eventually lead to the
retirement from the monetary circulation of the United States of circulating notes of national banking associations. A discussion of the
action taken appears on pages 22 and 23.
BUREAU OF INTERNAL REVENUE
During the fiscal year 1935, collections of internal revenue in
the amount of $2,773,000,000,^ exclusive of agricultural adjustment
taxes, exceeded collections in the preceding fiscal year by $472,000,000.
Agricultural adjustment taxes amounted to $526,200,000,^ which
exceeded collections from that source in the preceding fiscal year by
$154,800,0,00.
Back taxes on income
Efforts to obtain more prompt payment of back taxes on income
continued unabated during the year, and the total collected amounted
to $185,600,000. The collections during the year exceeded estimates
based on established quotas for the several collection districts. Back
tax collections usuaUj^ represent the concrete result of the investigation of income tax returns by Bureau representatives.
Close investigation of and attention to ^'tax sales" cases were continued during the fiscal year. These cases often involve apparent
sales, fictitious in fact, of stock or other securities to relatives or to
close business associates for the sole purpose of claiming deductions
from income for tax purposes.
The policy of closely, exariiining taxpayers' claims for depreciation,
deductions to prevent more than reasonable and consistent charges
on that account resulted in a reduction in depreciation allowances in
the approximate amount of $288,000,000 during the year. Additional
tax resulting from these disallowances was estimated in the amount
of $35,916,414, of which $25,032,112 was agreed to by taxpayers.
Alcohol tax administration
A concentrated attack was directed during the year against the
illicit manufacture of and traffic in nontax-paid spirits. In addition
to the general enforcement accomplishments, a specialized investiga-^
tive effort has been directed at the larger syndicates. trajBSLpking in
nontax-paid spirits, with the result that a great number of the; larger
organizations have been placed under indictment in the leading
metropolitan centers of the country.
The enforcement of the act of June 18, 1934, relating to substances
used in the illegal manufacture of distilled spirits, has brought about
» On the basis of reports of collections, see p. 294.

REPORT OP THE SECRETARY OF THE TREASUEY

a very material reduction in the sale of corn sugar, brown sugar,
black strap molasses, oak chips, and other materials generally used
in making unlawful liquors. The law requiring a stamp to be placed
on bottles of distilled spirits, as well as the law authorizing the
Treasury to regulate the use of bottles, has also aided materially in
reducing transactions in unlawful liquors.
Brewers were required to provide meters for the measurement of
beer for tax payment. These meters, which are now in operation at
all breweries, insure more accurate measurement of beer for tax
payment, and have permitted the removal of a large number of storekeeper-gagers heretofore required to be present when beer was
measured in tanks.
Resear^qb work was-performed in the laboratory of the Alcohol Tax
Unit to develop satisfactory methods for determining whether race
horses have been stimulated with narcotic or other drugs and for
assaying opium. Research work was also carried on with the view
of developing more efficient denaturants for the purpose of preventing
the diversion of tax-free denatured alcohol to Ulegal uses, and a new
specially denatured alcohol formula containing sucrose octa acetate
was adopted for the manufacture of rubbing alcohol compounds.
During the past few years substantial quantities of rubbing alcohol
compounds have been used for beverage purposes, but it is believed
that the new denaturant will prevent this diversion.
A detailed description of the work of the Bureau of Internal Revenue
will be found on pages 108 to 133 of this report.
CONSTRUCTION ACTIVITIES OF THE TREASURY

The. Defiai^tmBht'sbuildioig'operations,' cairi^^^^ on undier' seyei^l'
different programs and appropriations, resulted in the completion
during the fiscal year of 152 projects with a total limit of cost of
$262,594,557 and the placing under contract of 443 projects with a
total limit of cost of $68,707,433. At the end of the year additional
projects were in the following stages: 219 projects with a total limit
cost of $39,693,417 were on the market for bids or in the final stage
of preparing specifications; plans were being prepared for 73 projects
at a limit of cost of $19,221,810; land had been acquired for 6 additional projects to cost approximately $949,000; and sites for 28 projects to cost approximately $4,420.;000 had been-selected or were.in
process of selection.
The original public building program
The Public BuUding Act, approved May 25, 1926, and subsequent
acts enlarging the regular building program made general authorizations of $702,296,794 and total specific authorizations for buildings
and land of $496,366,798. Of the 735 construction projects previously under contract in this program, 702 had been completed by

REPORT OP THE SECEETAEY OP THE TEEASURY

June 30, 1935, leaving still under contract 33 projects with a total
hmit of cost of $12,792,575.
Building program in the District oj Columbia.—The program for
Federal buildings in the District of Columbia under the public building program of 1926 has been practically completed, except for minor
items for the Archives Building. The buildings for the Department
of Labor, the Department of Justice, and the Interstate Commerce
Commission, the South Building of the Department of Agriculture,
and the addition to the Federal Warehouse were occupied during the
year. The addition to the Internal Revenue Building is rapidly
nearing completion, and the National Institute of Health will be
ready for occupancy on all floors by September 1935. Bids had
been received for the new Interior Department BuUding to be constructed under a transfer of funds from the Public Works Administration amounting to $11,110,000, but award of the contract had not
been made at the end of the flscal year; and bids were being taken for
an extension to the Archives Building under an allotment of $3,610,000
by the Public Works Administration.
Program under the Public Works Administration
During the flscal year 1935 the total number of allotments for
public buUding projects inade by the Administrator of Public Works
was reduced from 465 to 442, but the total limit of cost under these
allotments was increased from $67,410,788 to $70,850,768. At the
end of the flscal year 27 of these projects had been completed under
a limit of cost of $2,978,675; 283 were under contract under a limit
of cost of $45,806,288; and bids had been received or were being
sohcited, or speciflcations were being completed on 101 projects, to
cost approximately $16,559,295; 17 were in the drawing stage; and
14 were awaiting the purchase or selection of sites.
Program under the Emergency Appropriation Act
The Emergency Appropriation Act approved June 19, 1934, provided $65,000,000 for public buildings thi'oughout the country, the
projects to be selected by the Secretary of the Treasury and the
Postmaster General. During the year, 355 projects estimated to cost
approximately $65,166,945 were selected, of which one was completed
' at a total limit of cost of $50,000, and 160 were placed under contract
at a total limit of cost of $22,901,145. At the end of the year bids
had been received, or the work had been placed on the market or
was in the speciflcation stage, on 118 projects to cost approximately
$23,131,500. The remaining 76 projects were in the drawing stage
or awaiting the acquisition of sites.

REI'ORT OP: THE SECRETARY OF. TMK TREASURY

Program jor other departments
Funds to the amount of $13,588,161 were transferred to the
Treasury Department by other departments for 37 projects involving the rehabUitation, extension, and remodehng of old buUdings,
construction of new buUdings, repair of sea walls, etc. Projects
totaling $2,288,861 were under contract at the end of the flscal
year, the value of work on the market or in the specification stage
was $11,110,000, and drawings were being prepared for projects to
cost approximately $189,300.
Detailed information with reference to all building programs and
appropriations wiU be found in the abstract of the report of the
Procurement Division on pages 148 to 152 of this report.
BUREAU OF CUSTOIVIS

Total customs receipts during the fiscal year 1935 amounted to
$343,353,000 as compared with $313,434,000 in 1934. This increase
of $29,919,000 refiects chiefly larger collections from duties on liquors
and wines and on certain agricultural products, which more than
offset small decreases in duties on sugar and other commodities.
The flscal year 1935 was the flrst full flscal year during which
the repeal of the eighteenth amendment was effective. Collections
from duties on imported liquor and wine aggregated $41,019,000 in
1935 as compared with $24,024,000 collected during the last 7 months
of the fiscal year 1934 subsequent to repeal.
Largely in consequence of the drought in the summer of 1934,
there were during the fiscal year 1935 comparatively large imports
of certain agricultural products including grains, fodders and feeds,
meats, butter, and vegetable oUs.
Imports of sugar in the fiscal year 1935 were 2,774,700 short tons
as compared with 1,359,300 short tons in 1934, This increase was
due to the postponement to the latter half of the calendar year 1934
of a large part of the year's quota of imports of Cuban sugar in anticipation of reductions in duty from 2 cents to 1.5 cents per pound on
June 8, 1934, and, under the Cuban trade agreement, to 0.9 cent per
pound effective September 3, 1934. The increased volume of sugar
imports permitted under the quota practically offset the effect of the
reduction in duty on Cuban sugar.
The value of dutiable imports entered for consumption in the fiscal
year 1935 was $752,153,000, an increase of 24.3 percent over 1934
and 77.1 percent over 1933. The value of imports entered free of
duty constituted 57.9 percent of the total value of aU imports entered
for consumption during 1935 as compared with 63.6 percent for 1934.
Foreign trade results and customs receipts are summarized by
fitscal years in the following table:
16816—36

REPORT OF T H E SECRETARY OP T H E

TREASURY

Merchandise exports and imports and customs receipts, fiscal years 1930 to 1936
[In millions of dollars]*

Fiscal year

1930
1931
1932.

Exports

General
Imports

4,694
3,083
1,948

3,849
2,432
1,730

Excess
of exCusports
toms
reover
imceipts 1
ports
845
661
218

587
378
328

Fiscal year

1933
1934
1935

Exports

General
imports

1,440
2,042
2,121

1,168
1,721
1,786

Excess
Cusof exports
toms
over
reimceipts »
ports
272
321
335

251
313
343

J On basis of daily Treasury statements (unrevised).

A more detaUed statement of the activities of the Bureau of Customs
is presented on pages 98 to 104 of this report.
NONFISCAL ACTIVITIES

Coast Guard
The Coast Guard continued to perform during the year its usual
duties, which are of great importance to maritime and general public interests. The principal activities were: The International Ice
Patrol in the vicinity of the Grand Banks of Newfoundland along the
trans-Atlantic steamship lanes and related ice observation and oceanographic cruises and surveys; patrol of the coast—including aircraft
patrol—to aid vessels and persons in distress; patrol of the waters of
the north Pacific Ocean, Bering Sea, and southeastern Alaska, for
the enforcement of laws and regulations for the protection of the fur
seal and sea otter, game, fisheries, and fur-bearing animals of Alaska,
and of other laws in Alaska; supervision of the anchorage and movements of vessels at ports and other places where Federal regulations
are in force; enforcement of the customs, navigation, motor boat, and
other laws of the United States; prevention of smugghng of liquor
and other contraband; removal of derelicts and other obstructions
from the paths of navigation; and the preservation of life and property at sea and along the coasts. During the year, 5,825 persons
were saved or rescued from perU by the Coast Guard.
A more detaUed account of these and other operations of the Coast
Guard wiU be found on pages 87 to 94 of this report.
Public Health Service
The work of collecting, compiling, and publishing current reports of
disease prevalence in the United States and throughout the world
was continued during the year. Preliminary mortality rates for a
large group of States for the calendar year 1934, showing a slight
ncre ase over the minimum rate for the United States recorded in 1933,
were made avaUable.

REPORT OP THE SECRETARY OP THE TREASUEY

The International Sanitary Convention for Aerial Navigation was
ratified by the United States on June 13, 1935, and wiU become effective November 22, 1935.
The Consular Regulations of the United States of America were
amended to authorize American consular officers in foreign ports to
authenticate foreign certificates of deratization and of deratization
exemption.
»,
Recommendation was made for favorable consideration on the part
of the United States of a proposal submitted by the International
Office of Public Health to amend article 25 of the International
Sanitary Convention of Paris (revised 1926) to permit the repeated
fumigation under special circumstances of ships coming from plagueinfected ports. Instructions were issued on March 5, 1935, requiring,
until further notice, aU vessels coming from River Plata ports. South
America, except Montevideo, to be considered as potentially dangerous from the standpoint of introducing plague and to be treated
accordingly at United States ports.
The privUeged quarantine treatment accorded vessels of the United
States Navy which carry naval medical officers has been extended to
vessels of the Coast Guard which carry medical officers of the Public
Health Service.
Medical officers of the Public Health Service were authorized, when
requested by immigration officials, to make the physical examination
of nominees selected by immigration officials for appointment as
immigration patrol inspectors.
In an effort to restrict the introduction of malaria, medical officers
of the Service on the Texas-Mexican border were directed to make
microscopic examinations of the blood of all arriving persons suspected
of having malaria, and to notify the State health authority of any
infected persons who were permitted entry.
A new quarantine station has been completed at Port Townsend,
Wash., to serve the various ports of ^he United States located on
Puget Sound and its tributaries.
In addition to trachoma eradication, psittacosis control, plaguepreventive measures in Cahfornia, Oregon, and Hawau, certifications
of sources of drinking water used on common carriers, and assistance
to rural health organizations, the Public Health Service participated
actively in the work relief program of the Federal Emergency Relief
Administration. Under this program and in cooperation with the
State health departments, sanitary outdoor toilets for rural homes
were constructed, malaria-control drainage projects were carried out,
and abandoned mines were sealed to prevent the pollution of streams
by acid wastes. In connection with work rehef projects for the control of endemic typhus fever, emphasis was placed upon rat-flea

REPORT OP THE SECRETARY OP THE TREASURY

surveys, rat extermination, and the promotion of rat-proof construction of buUdings.
The new administration and laboratory buildings for the National
Institute of Health in Washington, D. C , and the laboratory building
at the Rocky Mountain Laboratory, Hamilton, Mont., were completed
and occupied during the year.
Late in the flscal year an epidemic of poliomyelitis occurred in
North Carolina. With the aid of State and local authorities and the
cooperation of the medical profession, the Service began a carefully
controlled study designed to test the efficacy of a vaccine in the prevention of this disease.
Activities pertaining to venereal-disease control work have included investigative projects in the clinic and the laboratory, studies
of the prevalence and trend of syphihs and gonorrhea, and continued
cooperative work with State and local health departments. Among
the investigative projects the evaluation of various serodiagnostic
tests for syphilis was highly successful and received much favorable
comment. Several thousand transient citizens infected with venereal
diseases were treated at the Pubhc Health Service Chnic, Hot Springs
National Park, Ark. The admissions to this chnic have markedly
increased during recent years.
The United States Narcotic Farm at Lexington, Ky., the flrst
institution of this character, was completed and opened for the
reception of patients on May 29, 1935. The Service continued the
supervision and furnishing of medical, psychiatric, and technical
services for the Federal penal and correctional institutions under the
control of the-Department of Justice, and special stuches dealing with
the country's medical and scientiflc needs for narcotic drugs and the
medico-social problems of drug addiction were continued. Cooperation was also continued with international, national, and local
official and voluntary agencies interested in various phases of narcotic and mental hygiene problems with which the Pubhc Health
Service is concerned.
The marine hospitals and other relief stations of the Pubhc Health
Service continued to furnish hospital and out-patient care to American merchant seamen and other le2:al beneflciaries. By the act of
April 8, 1935, these benefits were extended to employees of the Works
Progress Administration who are beneficiaries of the Employees'
Compensation Commission. Seamen continued to be the most
numerous class of patients. In addition to the customary medical
services furnished to other Government agencies, the Pubhc Health
Service also assumed during the year medical supervision of 19 relief
units in the Treasury Department and other organizations.
The activities of the Pubhc Health Service are more fully presented
on pages 161 to 170 of this report.

EEPORT. OF THE SECRETAEY OF THE TEEASUEY

Bureau oj Narcotics
The Bureau of Narcotics has continued to direct its principal
enforcement activities against major narcotic law violators and has
made further progress in eliminating the sources of supply of illicit
narcotic drugs. Through the continued exchange direct with foreign
countries of information relating to illicit shipments, and with the
active cooperation of the Bureau of Customs, the supply of narcotics
available to the domestic illicit traffic from smuggled sources has further decreased, as evidenced by a marked decrease both in seizures
at ports and borders and in the total drugs seized. Due to greatly
increased actidties on the part of narcotic enforcement officers, seizures in the internal traffic showed a marked increase, but, as heretofore, the drugs seized showed upon analysis a high degree of adulteration, a further evidence of the shortage of the actual drugs in the
illicit market. Prices' in the illicit market continued high. The
total violations reported by narcotic officers showed an increase of
approximately 35 percent over the previous year.
The decreased supplies of smuggled narcotics available to the illicit
traffic have forced peddlers and addicts to turn more and more to the
channels of legitimate domestic medical supply. This renders the
robbery of wholesale and retail stocks, the forgery and false execution of narcotic prescriptions, and the improper prescribing and dispensing of narcotics, the major enforcement problems. Of the total
violations reported during the year, approximately one-third involved
persons registered under the law.
The Bureau has continued to receive the cooperation of State and
municipal enforcement agencies, whose activities have become more
and more effective with the adoption and enforcement of the uniform
State narcotic law. This law, approved by the Conference of Commissioners on Uniform State Laws and by the American Bar Association nearly 3 years ago, was adopted with little or no amendment during the fiscal year 1935 in 18 States: Arizona, Colorado, Connecticut,
Delaware, Georgia, Indiana, Louisiana, Maryland, Massachusetts,
Nebraska, New Mexico, North Carolina, Ohio, Oklahoma, Oregon,
South Dakota, Utah, and West Virginia. This makes a total of 26
States which have adopted this legislation, the law having been
adopted previously by Florida, Kentucky, Nevada, New York, New
Jersey, Rhode Island, South Carolina, and Virginia.
A more complete account of the activities of the Bureau will be
be found on pages 138 to 140 of this report.

REPORT OP T H E SECRETARY OP T H E TREASURY

ORGANIZATION CHANGES

No major changes in Treasury organization have occurred during
the fiscal year 1935, but much has been accomphshed in improved
administration in the various branches of the Department. Changes
in organization which should be specifically mentioned were as
foUows:
Treasury Department Order No. 8 of September 17, 1934, established in the Office of the Secretary a Division of Research and Statistics, which, in addition to other duties mentioned in the order, took
over the functions formerly exercised by the Section of Financial and
Econpmic Research in the Office of the Secretary.
By Treasury Department Order No. 9 of September 26, 1934,
all medical relief activities in the Treasury Department in the District
of Columbia, not then a part of or under the supervision of the United
States Pubhc Health Service, were transferred to that Service and
placed under the supervision of the Surgeon General.
By Treasury Department Order No. 10 of April 23,1935, the functions of purchasing and the storage, and distribution of stationery
supplies were transferred from the Division of Supply to the Procurement Division and placed under the immediate supervision of the
Assistant Director, Branch of Supply. The remaining functions of
the Division of Supply dealing with printing and binding and miscellaneous subjects were retained and the name of the Division changed
to the Division of Printing.
The above Treasury Department orders are contained in exhibit 49,
page 279, of this report.
On December 1, 1934, Miss Josephine Roche was appointed
Assistant Secretary of the Treasury, supervision of the Public Health
Service being assigned to her. A revision of Department Circular No.
244 (exhibit 50,p. 281), was made on December 7, 1934, covering this
assignment as weU as the assignment of all other bureaus, offices, and
divisions of the Department to the supervision of the Secretary, the
Under Secretary, the Administrative Assistant to the vSecretary, and
the Assistant Secretaries of the Treasury.
Attention is invited to the attached reports of bureaus and divisions
of the Treasury Department and to the exhibits and tables accompanying the report on the finances.
H E N R Y MORGENTHAU,

Jr.,

Secretary oj the Treasury.
To the SPEAKER OF THE H O U S E OP REPRESENTATIVES.

ADMINISTRATIVE REPORTS
OF BUREAUS AND DIVISIONS

O F F I C E O F THE COMMISSIONER OF ACCOUNTS AND DEPOSITS

Combined statement oj assets and liabilities oj governmental corporations
and credit agencies
Under Executive Order No. 6869 of October 10, 1934, a copy of
which appears as exhibit 51, page 282, every executive department
and independent establishment of the Government holding assets
or incurring liabilities and every corporation in which the Government of the United States has a proprietary interest is required to
furnish to the Secretary of the Treasury, not later than the fifteenth
day of each month, a statement of its assets, liabilities, capital, and
surplus, as of the close of business on the last business day of the
preceding month. The order further provides that the Secretary of
the Treasury shall cause to be published monthly on the daily statement of the United States Treasury a combined statement of the
assets, liabUities, capital, and surplus, reported pursuant to the
provisions of such order. Prior to the issuance of the above order,
the first combined statement of assets and liabilities of governmental
corporations and credit agencies as of June 30, 1934, was released on
August 29, 1934. The statement as of June 30, 1935, appears as
table 37, on page 411 of this report. Following is a summary statement of the proprietary interest of the United States in these
corporations and agencies as of June 30, 1934 and 1935.
Proprietary interest of the United States in governmental corporations and credit
agencies, June 30, 1934 and 1935
[In millions of dollars]
June 30,
1934

June 30,
1935

I. Financed wholly from Government funds:
Reconstruction Finance Corporation
Commodity Credit Corporation
Export-import banks
Public Works Administration
Regional agricultural credit corporations.
Production credit corporations
Aiiother

2,035
163
14
312
77
121
610

Total, group I .
II. Financed partly from Government funds and partly from private funds:
Federal land banks
Federal intermediate credit banks
Federal Farm Mortgage Corporation
Banks for cooperatives
Home loan banks
_
Home Owners' Loan Corporation.
Federal Savings and Loan Insurance Corporation
Federal savings and loan associations
Federal Deposit Insurance Corporation
War Finance Corporation
Total, group I I .

3,238

3,322

161
85

251
84
206
129
82
70
102
32
150

197

111
81
144
1,
160

930

1,108

Grand total

4,428

1 Less than a million dollars.

Securities owned by the United States Government
The aggregate amount of securities owned by the Government on
June 30, 1935, based upon the latest reports received, was $17,676,

REPORT OP THE SECRETARY OP THE TREASURY

212,144.72 as against $16,957,995,149.53 on June 30, 1934 (revised
statement made up in same form as June 30, 1935, statement), an
increase of $718,216,995.19. A summary comparison of the holdings at the end of the last 2 fiscal years is shown below. A detaUed
statement of the securities held on June 30, 1935, wiU be found as
table 36, page 408.
Summary of securiiies owned by the United States on June 30, 1934 {revised) and
1935
June 30, 1934
(revised)
Foreign obligations:
Received under debt settlements
All other
Total
Capital stock of war emergency corporations
Capital stock, etc., of other governmental corporations and credit agencies:
Capital stock of Panama R. R. Co_.
Capital stock of Inland Waterways Corporation__ -.
Reconstruction Finance Corporation
(Capital stock and notes, less funds expended for subscriptions to capital stock of
other governmental corporations and funds
disbursed to other governmental agencies
for making loans included below.)
Capital stock of the Home Owners' Loan
Corporation..
Capital stock of regional agricultural credit
corporations
Capital stock of Federal home loan banks
Capital stock of Federal Farm Mortgage
Corporation.
Capital stock of Export-Import Bank of
Washington
'.
Capital stock of Second Export-Import Bank
of Washington
Capital stock of RFC Mortgage Co
Capital stock of production credit corporations
Capital stock of commodity credit corporationCapital stock of Electric Home and Farm
Authority, Inc
Capital stock of Federal Deposit Insurance
Corporation..
Capital stock (preferred and full-paid income shares) of Federal savings and loan
associations.
Capital stock of Federal Subsistence Homesteads Corporation.
Capital stock and paid-in surplus of Federal
land banks
J...
Capital stock and paid-in surplus of Federal
intermediate credit banks
Capital stock of Central Bank for Cooperatives
Capital stock of banks for cooperatives
Other obligations and securities:
Railroad obligations... ..^
Obligations acquired by Federal Emergency
Administration of Public Works
Notes received by Farm Credit Administration evidencing outstanding advances
made from the revolving fund created by
the Agricultural Marketing Act
Securities received by Secretary of War
Securities received by Secretary of Navy
Securities received by U. S. Shipping Board
Bureau
Obligations of farmers for seed, feed, droughtrelief, and crop-production loans
Obligations of joint stock land banks
Total

June 30, 1935

Increase (+) or
decrease (—)

$11,156,861,007. 67 $11,155, 784, 298.04
859,205,363. 64
859,205,363. 64

—$66,709. 63

12,015,056,371. 21 12,014,989,661.68
83, 732,612. 37
83,683,096.22

-66,709.63
-49.616.16

7,000,000.00
12,000, OOO 00
3,152,818,871.78

7,000,000.00
12,000,000 00
3,486,216,664.93 +333,396,683.15

154,000, OOO 00

1200,000,000 00

+46.000. OOO 00

44,600,000.00
81,446, 70O 00

44,500,000 00
81,645.700, 00

+200, OOO 00

200,000,000.00

200,000, OOO 00

11,000, OOO 00
2,750, OOO 00
105,000,000.00
3,000, OOO 00

11,000,000 00
2,750,000 00
10,000, OOO 00 +10,000,000.00
120,000,000 00

1,000, OOO 00

1,000,000 00

150,000, OOO 00

150,000,000 00

1,086,30O 00
10,000.00
163,883,152.16
85,000,000 00
50,000,000.00
60,000,000.00
37,711,04L 34

+15,000.000.00

3,000,000 00

32,464, OOO 00 +31.377.70O 00
10, OOO 00
199,452, 477. 76 +35.569,325. 69
100,000,000 00

+16,000, OOO 00

65,000, OOO 00 +15.000, OOO 00
60,000,000.00
31,192.166.36

-6,518.884.98

145,423,423. 39

312, 360, 510 09 +166.937.086.70

150,360,286.43
828,000.00
4,909,988.20

125,211,123. 35
433,000 00
5,086.301.17

-25.149.163.08
-395,000 00
+176. 312.97

119, 719,682.87

-23, 220, 654. 49

142, 940, 237. 36
91, 603,755. 27
935,410 02

197.124,401. 86 +105,520.646. 69
374,478, 44
-560.931.68

16,967,995,149.63

17,676.212.144,72 +718, 216.996.19

1 Includes $100,000,000 expended for subscription to capital stock of the Federal Savings and Loan Insurance Corporation.

EEPORT OP THE SECRETARY OP THE TREASURY

Contingent liabilities oj the United States
A summary statement of the contingent habilities of the United
States as of June 30, 1934 and 1935, and the change between the two
dates is shown below. A full statement of such liabilities of the
United States as of June 30, 1935, and a description of them appear
as table 33, page 403.
Total amount of contingent liability
Obligation

Agency

Federal Farm Mortgage Corporation.
Federal land banks

June 30, 1934
Bonds, various issues...
4 percent consolidated
bonds of 1934, interest
only.
Bonds, various issues...

June 30, 1935

$313,488.166.12 $1. 233,090.547.93
6, 303,499,99

Increase (+) or
decrease (—)

+$919.602.382.81
—6.303,499.99

Home Owners' Loan
135, 272, 290 76 2.666.676.480. 21 +2.631.304.189. 46
Corporation.
235,797.098.28
+16,191.303.54
260,988.401.82
Reconstruction Finance Notes, various issues...
Corporation.
-13.806,130 24
58,900,130 24
45,096. OOO 00
Secretary of Agriculture. Funds borrowed upon
cotton.
Postal Savings System- Funds due depositors.. 1. 220. 649,448.99 1,230,976,844.67
+10.427,396.68
Federal Reserve Sys- Federal Reserve notes.. 3.326.266,033.00 3.-234.969,136.00
-90,305.898.00
tem.

Accounting and disbursing oj emergency reliej junds appropriated
under the Emergency Reliej Appropriation Act oj 1935
Section II (A) of Executive Order No. 7034, dated May 6, 1935,
directs:
(A) The Secretary of the Treasury, (1) through the disbursing and accounting
facilities under the Commissioner of Accounts and Deposits of the Treasury
Department, to make provision for all disbursements from the funds appropriated by the ''Emergency Relief Appropriation Act of 1935", subject only to such
exceptions as the Secretary may authorize, and to maintain a system of accounts
necessary to enable the President (a) to exercise Executive control over such
funds, (6) to provide Current financial and accounting information for governmental agencies concerned, and (c) to make a complete report to the Congress concerning expendittures made and obligations incurred, by classes and
amounts * * *^

Pursuant to the provisions of this order, the Secretary of the
Treasury issued on June 18, 1935, Regulation No. 1 prescribing
administrative procedure for the maintenance of a system of accounts
and disbursements under the Emergency Relief Appropriation Act
of 1935. This regulation was approved by the President and issued
as Treasury Department Circular No. 543, a popy of which appears
as exhibit 52, on page 283.
With a view to providing effective accounting controls and in order
to facihtate disbursing operations, there have been set up in each
State a Treasury accounts office and a Treasury disbursing office.
For administrative expediency these offices are located in the same
cities as the Treasury procurement offices and the State headquarters
of the Works Progress Administration.
Accounts are maintained showing in detail the status of the
funds allocated by the President for various projects and purposes,
and at frequent intervals reports are prepared for the information of
administrative officers and others concerned, showing obligations,
expenditures, and balances under each project and under various
classifications, such as States, Government establishments, etc.

REPORT OF THE SECRETARY OP THE TREASURY

Obligations ojjoreign governments
The United States received during the fiscal year 1935 payments
aggregating $666,391 on account of the indebteciness of foreign
governments, of which $62,000 was for account of principal, $566,330
was for account of interest, and $38,061 was for account of annuities
under the moratorium agreements.
The following statement shows the payments due during the period
July 1 to December 31, 1934, and the amounts actually paid on
account by certain governments:
AMOUNTS DUE AND PAYABLE, JULY 1 TO D E C E M B E R 31, 1934
Funding agreements
Country
Belgium.
Czechoslovakia
Estonia .
Finland
France
Great Britain
Greece '._•_
Hungary
Italy
Latvia .
Lithuania
Poland...
Rumania

Principal

_
•

$3.109,453, 88
1. 682,812, 78
631, 350 29
228,638.00
22, 308, 312.22
117, 670, 765.05
641,957. 38
50,210. 65
2.141,693. 38
220,683.26
121, 466. 93
6, 616,039. 71
48, 760.08

36,691, IOO 00 103, 688,860. 24

14,991,983. 37

155, 271, 933. 61

32.000,000 00
245,000, 00
12,80O 00

2, 577,000.00
-

Total

$484, 453. 88
182,812. 78
36, 586. 29
19,030. 50
3,046,879.72
9,720, 765. 05
67,137. 38
4,226. 68
896,155.88
15, 274, 26
13,683, 26
466, 229, 71
48. 750, 08

$1.500, OOO 00
208,500.00
62, OOO 00

Moratorium
agreements

286, 265. 00
147, 507. 50
19,261,432.50
76, 950,000. 00
229,820.00
33,185. 07
1.245, 437. 60
119, 609. 00
107, 783. 67
3, 682,810.00

. . .

85,800.00

Total

Interest
$2,625,000.00

AMOUNTS ACTUALLY PAID
Finland
Greece
Total

$62,000 00

$147, 607. 50
2 272, 400. 00

$19.030. 60

$228, 638.00
272,400. 00

62, 000,00

419,907. 50

19, 03O 60

500, 938.00

1 Exclusive of principal payment of $150,000 postponed under the provision of the funding agreement
with Greece.
2 A payment of $196,128 (27 J^ percent of interest due on May 10, 1933, and Nov. 10, 1933, and 36 percent
of interest due on May 10,1934) was received on July 6,1934. An additional payment of $76,272 (35 percent
of amount due on Nov, 10,1934) was received on Nov. 10, 1934.'

The following statement shows payments due during the period
January 1 to June 30,1935, and the amounts actually paid on account:
AMOUNTS DUE AND PAYABLE, JANUARY 1 TO JUNE 30, 1935
Funding agreements
Country
Austria 1
Belgium
Czechoslovakia. .
Estonia
Finland
France
Great Britain
Greece
Hungary
Italy
Latvia
Lithuania
Poland
Rumania.
Yugoslavia

•

. .

Total.......

Principal

Interest

$4,300,000.00
1.500,000.00

$2.625,000.00

42,068,825. 41
1. 111. 000.00
13,000,000.00
42,885,00
1,400, 000.00
325. OOO 00
63, 737.710 41

286, 265.00
146, 422. 50
19,261.432,50
75.960,000 00
233,007, 60
33.185,08
1, 246,437. 50
119, 609.00
107, 783. 67
3, 682,810 00
103,590.962, 76

Moratorium
agreements
$484.453, 88
182.812, 78
36, 586, 29
19,030 50
3,046,879.72
9.720,766.06
67,137. 38
4.226. 58
896.156.88
16,274. 26
13,683. 26
466, 229. 71
48.750.08

Total
$7.409.463,88
1,682,812,78
322,850. 29
165.463,00
64,367,137.63
86,670,766,05
1, 411,144.88
37.410.66
16,141,693.38
134.883.26
164,361. 93
4,039,039. 71
1,448,760 08
325,000.00

14.991.983.37

182,320.646. 53

$19.030 50

$166.463,00

AMOUNTS ACTUALLY PAID
Finland.

$146,422.60

1 Payments aggregating $494,860,23 were postponed under the provisions of the funding and moratoriiim
agreements with Austria,

EEPORT OF THE SECRETABY OF THE TEEASTJEY

Press releases of the Treasury and the Department of State and
correspondence exchanged between the Government of the United
States and various foreign governments regarding the amounts due
during the fiscal year will be found as exhibits 45 and 46 on pages 269
and 271 of this report.
A statement showing the principal of the funded and unfunded
indebtedness of foreign governments to the United States, the accrued
and unpaid interest thereon, and payments on account of principal
and interest as of November 15, 1935, appears as table 42 on page 423.
The total amounts previously due from foreign governments on
account of their indebtedness to the United States under the funding
and moratorium agreements and not paid as of November 15, 1935,
according to contract terms, are shown in the following statement:
T O T A L AMOUNTS D U E AND N O T P A I D , AS OF N O V E M B E R 15, 1935
F u n d i n g agreements
Moratorium
agreements

Country

Austria
Belgium . . .
C zechoslo v a k i a
Estonia
France
Great Britain
Greece
Hungary'.
Italy
Latvia.
.
Lithuania
Poland
Rumania..
Yugoslavia .
Total

. .

Principal

Interest

$12,800,000.00
7.170,085. 83
344,000, 00
100, 227,866, 76
64,000,000,00
2, 696,000.00
37,870 00
37,900,000. 00
133, 300, 00
124, 385. 00
4,202,000 00
3,600,000. 00
1,150,000. 00

$14,260, OOO 00

234. 385.607. 69

521.431.757.96

1,676,695. 00
115,568,595.00
362, 249,481, 58
1, 231,651, 50
184,888, 29
4, 227,166. 74
682, 514.84
475, 735. 00
20.986,030.00

Total

$1,937,815. 62
731,251.12
146, 341.16
12,187, 518. 88
38,883,06O 20
335, 686. 90
16,902. 32
3, 684,623, 62
61,097,04
64, 733, 04
1,824,918.84
195,000. 32

$28.987.815. 52
7,901, 336. 95
2,167.036.16
227,983,980 64
465,132, 541. 78
4, 263, 338. 40
239,660. 61
45, 711,790 26
776, 911.88
664,863.04
27, Oil, 948.84
3, 795,000. 32
1,150, OOO 00

69,958.948.86

815, 776, 214. 40

J The Hungarian Government has deposited with the foreign creditors* account at the Hungarian National Bank the aggregate amount of 994,994,98 pengo. The debt-funding and moratorium agreements
with Hungary provide for payment in dollars in the United States.

Receipts jrom Germany
During the fiscal year 1935 the United States received no payments
from the Government of Germany under the debt-funding agreement
of June 23, 1930, covering the costs of the American Army of Occupation and the awards of the Mixed Claims Commission, United States
and Germany.
Army costs.—A payment amounting to 9,300,000 reichsmarks due
September 30, 1934, on account of the costs of the Army of Occupation was postponed to March 31, 1935, under the provisions of the
debt-funding agreement. In accordance with the provisions of the
agreement such postponed payment bears interest at the rate of 3% percent per annum. The payments aggregating 53,200,000 reichsmarks,
which were previously postponed, became due on March 31, 1935,
and there also matured on that date a payment of 9,300,000 reichsmarks. These principal sums together with interest falling due on
September 30, 1934, and March 31, 1935, amounting to 1,759,937.50
reichsmarks, have not been paid by the Government of Germany.
There has been no change in the Army cost account from that shown
in the statement appearing on page 39 of the annual report for 1932.

REPORT OF THE SECEETAEY OF THE TREASURY

Mixed claims. United States and Germany.—The payments of
20,400,000 reichsmarks each, due on September 30, 1934, and March
31, 1935, from the Government of Germany on account of mixed
claims awards were not made under the provisions of the debt agreement of June 23, 1930. The interest amounting to 6,630,000 reichsmarks due on those dates also has not been paid.
Annuities under moratorium agreement.—The semiannual instaUments of the annuities under the moratorium agreement with the
Government of Germany dated May 26, 1932, aggregating 3,058,098.90 reichsmarks, which were due during the fiscal year 1935, were
not paid by Germany.
The status of the indebtedness of Germany to the United States
as of June 30, 1935, is summarized in the foUowing tables:
AMOUNT OF I N D E B T E D N E S S
[In reichsmarks]

Army costs
Mixed claims
Total

Indebtedness as
funded

Total indebtedness as of June
30.1935

Principal

1.048,100,000
2,121.600.000

1,001.124,097.61
2, 048,670,000.00

997.500,000
2,040,000,000

3,169.700 000 3 3,049.794.097. 61

3,037.600 000

Interest accrued and unpaid 1
3, 624, 097. 61
8,670,000 00
12,294.097.61

PAYMENTS RECEIVED
Total payments
received as of
June 30,1935
Army costs (reichsmarks)
Mixed claims (reichsmarks)

Total (reichsmarks)
Amounts received (in dollars)

51,456.406. 25
87,210.000 00

Payments of
principal
60.600,000.00
81,600,000 00

Payments of
interest
856 406 25
5,610, OOO 00

138,666,406.25

132,200,000.00

6,466.406 25

$33,687.809.69

$31,639,596,84

$2,048, 213 85

AMOUNTS NOT PAID ACCORDING TO CONTRACT T E R M S , JUNE 30,1936
[In reichsmarks]
Funding agreement
Moratorium
agreement

Date due
Principal
Sept. 30,1933..
Mar 31, 1934...
Sept. 30. 1934..
Mar 31. 1936...

122,400,000
20,400,000
82,900,000
226.700.000

Total..

Total

Interest
2,498,662.60
3,855,687.50
4,534, 250 00

1.529,049.45
1.629,049, 46
1.629,049. 45
1, 629,049; 46

2 4,027,611.95
123,929,049.45
25, 784, 736. 95
88,963, 299.46

10.888.500.00

6.116.197.80

242, 704.697.80

1 Includes interest accrued under unpaid moratorium agreement annuities.
2 Includes 4,027.611.96 reichsmarks deposited by German Government in the Konversionskasse fur
Deutsche Auslandsschulden and not paid to the United States in dollars as required by the debt and moratorium agreements.

Treasury administration oj alien and mixed claims
The Settlement of War Claims Act of 1928 authorized the Secretary
of the Treasury to make payments on account of (1) awards of the
Mixed Claims Commission, United States and Germany, for claims

REPORT OP THE SECRETARY OP THE TREASURY

of American nationals against the Government of Germany; (2)
awards of the War Claims Arbiter for claims of German, Austrian,
and Hungarian nationals against the Government of the United
States; and (3) awards of the Tripartite Claims Commission for
claims of American nationals against the Governments of Austria
and Hungary.
The time within which claimants could file applications for awards
from the Mixed Claims Commission, United States and Germany,
and the Tripartite Claims Commission, United States, Austria, and
Hungary, has been extended from time to time. The time within
which such applications may be filed will expire .on March 10, 1936.
The restrictions imposed by Public Resolution No. 53 of June 27,
1934, as to payments, transfers, and deliveries of property under the
Trading with the Enemy Act, as amended, and the Settlement of
War Claims Act of 1928, as amended, were removed in certain cases,
pursuant to Executive Order No. 6981, dated March 2, 1935. A copy
of this order will be found as exhibit 53, page 288 of this report. A
copy of Public Resolution No. 53 will be found as exhibit 39 on page
253 of the annual report for 1934.
Mixed Claims Commission: Claims against Germany.—The Treasury made payments up to September 30, 1935, in the aggregate
amount of $135,379,216.93 on account of awards of the Mixed
Claims Commission, from which there has been deducted $676,896.68,
representing one-half of 1 percent authorized by the Settlement of
War Claims Act, making net payments to claimants of $134,702,320.25.
Of the deductions so made, $650,025.64 has been covered into the
Treasury as miscellaneous receipts or reserved for such purpose in
accordance with the Settlement of War Claims Act of 1928, as reimbursement to the United States for expenses incurred, and $26,871.04
has been paid to the German Government or reserved for payment
to that Government in accordance with the agreement of December
31,1928, and the act of Congress approved June 21,1930, for defraying
such expenses as were incurred by that Government in connection
with the adjudication of the late claims.
The following summary shows the awards certified to the Treasury
by the Secretary of State, by classes, number and amount of the
awards, the amount paid on account, and the balance due thereon as
of September 30, 1935:

Number and amount of awards of the Mixed Claims Commission, United States and Germany, certified to thei Secretary of ihe Treasury by
the Secretary of State; and the amount paid, and balance due, by classes, as.of September SO, 1935
Class II

Classi
1 Total
num- Total amount
ber of
awards

Awards certified

1. Amount due on account:
Principal of awards:
Agreement of Aug. 10, 1922
Agreement of Dec. 31, 1928

4,551 $156,685,145. 09
3,695,863.20
2,290

Awards on
NumNumaccount of
ber of
ber of
death and
awards personal
injury awards

420
115

Total payable to Jan. 1,1928
Interest thereon to date of payment or, if
unpaid Sept. 30, 1935, at 5 percent per
annum as specified in the Settlement of
War Claims Act of 1928

United States Government

Class III

Number of
awards

298
6

Awards over
$100,000

Number of
awards

$96,058,757.17
691,434. 28
96,750,191,45.

48, 012. 50

139.214.35

Amount

$42,034,794.41
42,034,794. 41

i
H

160.193.781. 44

4, 046,062. 75

17, 501.947.18

96. 610. 977.10

42,034,794.41

69. 765,018. 74
1.409, 240,88

732,801. 61
115,976.22

6,851, 202.19
971.159.15

42,961. 689. 72
322,105. 61

19, 209,325. 22

231, 358.041, 06

4,894, 840. 58

-25.324,308. 52

139.894. 772.33

61,244.119.63

47.495.781. 04

188,801. 74

1, 369, 482.96

23,717,414 55

278.853,822.10

5, 083, 642.32

26,693, 791, 48

^.
H

22, 220, 081. 79 ,
162,114,864,12

84,961,534.18

tel
H
W

2. Payments made on account up to Sept. 30,1935:
Prmcipal of awards:
Agreement of Aug. 10,1922
Agreement of Dec. 31, 1928
Interest to Jan. 1, 1928, at rates specified in
awards:
Agreement of Aug. 10, 1922
_
Agreement of Dec. 31,1928
Interest at 5 percent ijer annum from Jan. 1.
1928, to date of payment as directed by the
Settlement of War Claims Act of 1928
Total pa3mient to Sept, 30,1935

$15,102,155. 76
2,447,803.92
17.549,959. 68

187, 226.85

Interest to Jan. 1, 1928, at rates specified in
awards:
Agreement of Aug. 10,1922..
Agreement of Dec. 31, 1928

Total due claimants

3,829
2,169

4.046. 062. 75

160. 381,008. 29
Less amounts paid by Alien Property Custodian and others
.

$3,489,437. 75
656, 625. 00

Awards of
$100,000 and
less

4,235 1 121.383,877, 46
3. 791.791.80
2,263

420
115

3, 489, 437.75
656, 625.00

3,815
2,148

16,028,495, 44
2,445.886, 69

1 102.865,944.27
789. 280 11

t
ZP

7, 573,820. 33
1,086,361.02
1. 543, 366. 32
1

1 135.379.216.93

732,801. 61
116,976.22
188.801. 74
6,083,642.32

6, 841, 018. 72
970, 384,80

(«)
(2)

1, 354. 664. 58

(?)

26.640, 350. 23 i

103,666, 22138

Oi
00
CD

1 3.

00
Oi

Less H of 1 p e r c e n t d e d u c t i o n from each
pasrment:
A g r e e m e n t of A u g . 10.1922
^
A g r e e m e n t of D e c 31, 1928.

3 650,026.64
* 26,871, 04

21. 660 20
3, 767.97

114, 045. 32
19,166. 68

614,330 12
3.946. 39

N e t p a y m e n t s m a d e to c l a i m a n t s u p to
Sept, 30, 1936

134.702,320. 26

6, 058, 224.16

26, 507,148. 23

103.136,947.87

B a l a n c e d u e on a c o u n t :
Principal of a w a r d s :
A g r e e m e n t of A u g 10.1922. . .
A g r e e m e n t of D e c . 31, 1928
Interest to J a n , 1, 1928, a t rates specified in
awards:
Aerreement of A u e 10. 1922 .
A g r e e m e n t of D e c . 31, 1928
Accrued interest a t 5 percent per a n n u m from
J a n . 1, 1928, on total a m o u n t p a y a b l e as of
J a n 1. 1928, to Sept. 30, 1936
B a l a n c e d u e c l a i m a n t s as of Sept. 30,1935

316
27

97, 285, 055. 72
226.176,91

14
21

25, 647.82
1,917, 23

298
6

36. 015, 288. 27
224, 259, 68

61. 244.119.63

10,183, 47
774, 35

10,183. 47
774. 35

45,962.414. 72

14,918. 38

22, 220,081. 79

23,717,414.65

143. 474, 605,17

53. 441. 26

68, 469, 629. 74

84,961,634 18

o
O
H

w
teJ
ZP

J Includes payments on account of interest to Jan. 1,1928, on class III awards. Payments on this class of awards are first applied on account of the total amount payable as of
Jan. 1,1928. as directed by the Settlement of War Claims Act of 1928, until total of all payments on the three classes equals 80 percent of the amount payable Jan. 1,1928. Payment
of accrued interest since Jan. 1, 1928, on this class of claims deferred in accordance with act.
2 See above note.
3 Of this amount $646,025.54 has been covered into the Treasury as miscellaneous receipts. A further sum of 10 cents will be covered into the Treasury at a later date.
< Of this amount $24,150.09 has been paid to the Government of Germany. A further sum of $2,720.95 is payable in connection with the adjudication of late claims under the
agreement of Dec. 31,1928.

tel

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REPORT OF THE SECRETARY OP THE TREASURY

War Claims Arbiter.—Under the Settlement of War Claims Act
of 1928, it was the duty of the War Claims Arbiter, within certain
hmitations, to hear the claims of German, Austrian, and Hungarian
nationals and to determine the fair compensation to be paid by the
United States for ships seized, patents sold or used by the United
States, and a radio station sold to the United States.
War Claims Arbiter: Claims oj German nationals.—The Treasury
has completed payment of 50 percent of the amount of all awards
made by the War Claims Arbiter in favor of German nationals as
required by paragraph 7 of section 4 (c) of the Settlement of War
Claims Act of 1928. Fifty percent of the award in favor of the estate
of a German national was paid during the fiscal year foUowing removal
by the President of the restrictions of Public Resolution No. 53,
approved June 27, 1934, upon recommendation by the Secretary of
the Treasury.
The following summary shows the nurnber and amount of awards in
favor of German nationals certified to the Treasury for payment and
the payments made on account:
Aivards of the War Claims Arbiter on account of claims of German nationals for
ships, patents, and radio station, amount paid, and balance due on each as of
September SO, 1985
Total amount
(315 awards)

1. Amount due on account:
Principal of awards including interest to Jan. 1
1929
..•
Interest at 5 percent per annum from Jan. 1, 1929,
on total amount payable as of Jan. 1,1929, or on
the principal amount remaining unpaid to
Sept 30, 1935
Total due claimants
2. Payments made on account to Sept. 30, 1935:
Principal of awards
Interest at 5 percent per annum from Jan. 1, 1929
on total amount payable as of Jan. 1,1929, or on
the principal amount remaining unpaid to
Sept. 30, 1935
Total payments to Sept. 30, 1935
3. Balance due on account:
Principal of awards
Interest accrued at 6 percent per annum from
Jan. 1. 1929, on total amount payable as of Jan
1, 1929, or on the principal amount remaining
unpaid to Sept. 30, 1935
Balance due claimants

Patents and
Ships, amount radio station,
(27 awards)
amount (288
awards)

$86,738,320.83 1 $74,262.933.00 $12.485,387.83
19,321,149.97

16,390,173. 26

2,930,976. 71

106,059,470.80

90, 643,106. 26

15,416.364.54

43, 368,899. 24

37,126,205.21

6.242,694.03

43, 368,899. 24

37,126, 205. 21

6, 242, 694.03

43, 369, 421. 59

37,126, 727. 79

6, 242, 693. 80

19, 321,149. 97

16, 390,173. 26

2,930,976. 71

62, 690, 571. 56

53, 516,901. 05

9,173, 670. 61

R^ 1 Includes awards amounting to $522.58 to members of former ruling family of Germany (Sec. 3 (j),
?/ Settlement of War Claims Act of 1928, as amended).

War Claims Arbiter: Claims oj Hungarian nationals.—The awards
made by the Arbiter to Hungarian nationals in the sum of $39,125,
with interest at the rate of 5 percent per annum from July 2, 1921,
to December 31, 1928, amounting to $14,675, have been paid with the
exception of two awards amounting to $1,512.58, together with
interest thereon at the rate of 5 percent per annum from December
31, 1928.
German special deposit account.—The following statement shows
the total amounts deposited in the German special deposit account,

REPORT sP'F THE SECRETARY OP THE TREASURY

the amounts paid therefrom up to September 30, 1935, and the
balance held in the account:
Funds deposited in the German special deposit account and payments made therefrom
up to September 30, 1935
RECEIPTS
From investments by Alien Property Custodian under
Trading with the Enemy Act. as amended:
Unallocated interest fund
$25,000,000 00
Less refunds
3,250,000.00
20 percent German property retained.
From Germany:
2H percent of Dawes' annuities available for reparations (Paris agreement of Jan. 14, 1925).
Under German-American debt agreement, June 23,
1930....
Interest on payments postponed under terms of debt
agreement dated June 23, 1930...
Appropriation for ships, patents, and radio station
Expenses of administration. War Claims Arbiter, on
account German nationals.

21, 750,000. 00
17,552,096.91
$39, 302,096. 91
32,183,060 87
19,469,964.00
1,743,738, 70
86, 738,320.83

53,396,763. 57

113, 624. 20
86, 851,945.03

Earnings and profits on investments made by Secretary
of the Treasury.

4,481,43L 95

Total receipts

$184,032.237.
PAYMENTS ON ACCOUNT

Awards of the Mixed Claims Commission:
Under agreement of Aug. 10, 1922
Under agreement of Dec. 31, 1928

$129,354,936. 29
5,347, 383. 96

Awards of War Claims Arbiter:
For ships....
.—
37,126, 205. 21
For patents and radio station
6,242,694.03
}^ of 1 percent deducted from mixed claims payments covered into
Treasury
^ of 1 percent deducted from mixed claims payments on account of
awards entered under agreement of Dec. 31, 1928 (act of June 21, 1930)
and paid to Germany ($2,720.95 withheld but not paid)
Advances to special fund, expenses of administration of the Settlement of
War Claims Act of 1928 (oflice of the Secretary of the Treasury)
Expenses of administration, War Claims Arbiter account of German
nationals

$134,702,320 25
43, 368,899. 24
650,025.54
24,150.09
39,175. 00
113,624. 20

Total payments on account
Balance (including investments)
Made up as follows:.
'
$4,447,000 face amount 3 percent Treasury bonds of 1951-55
$110,000 face amount ZH percent Treasury notes, series A, due
Sept. 15, 1937.
Cash balance

178,898,194.32
,.

5,134,043.14

Principal cost
$4,425,098. 51
110,103.13
598,841. 50
5^ 134^ 043.14

Tripartite Claims Commission: Claims against Austria.—The total
amount of awards, including interest, certified by the Tripartite
Claims Commission to the Treasury for payment was $370,032.14.
All of these awards against Austria have been paid, except one in the
amount of $135.06. Sufficient funds have been retained in the Austrian special deposit account to pay this award. No payments were
made on these awards during the fiscal year 1935.
Tripartite Claims Commission: Claims against Hungary.—The
awards entered by the Tripartite Claims Commission against Hungary,
in favor of American nationals, amounted to $199,975.57. During the
fiscal year 1935 the Treasury made payments to American nationals
on account of such awards amounting to $14,570.12. As of June 30,
1935, awards aggregating $9,194.88 had not been paid because claimants had not filed applications as required by law.

EEPOET OF T H E SECRETARY OF T H E TREASURY"

Railroad obligations
Total receipts during the fiscal year on account of railroad'securities>
owned by the United States, which were acquired under the Federa!
Control Act, as amended, and the Transportation Act, 1920, as^
amended, amounted to $6,871,047.15, classified as follows:
Principal
Collections b y T r e a s u r y D e p a r t m e n t :
Sec, 210
Sec. 207
E q u i p m e n t t r u s t notes

$6,485.284.98
. _ .

Total
Collections b y Director General
G r a n d total

Total'

Interest

$334,387,81
12,750.00
2, 016 00

$6,819, 672. 7^..
12, 750.00
35, 616. 00 •

6,518,884.98

349,153.81
3,008.36

6.868, 038. 7 9 .
3,008. 3 a

6,518,884 98

352,162 17

6 871. 047 15-.

33,600. 00

The following statement shows the total amount of raUroad obligations, by classes, originally held by the United States Government
(exclusive of certain miscellaneous obligations held by the Director
General of Railroads), the amount held on June^ 30, 1935, anda
payments received on account:

/
Federal Control Act:
E q u i p m e n t t r u s t notes
Sec. 7
S e c 12
Transportation Act:
Sec. 207
Sec. 210-.
Total

Principal
amount
originally
held

$346. 556,750.00
98,401, 755 00
62,103,453 28
282, 712, 837. 36
290,800,667. 00
1, 080, 575, 462. 64

T o t a l . p a y m e n t s received

Principal
a m o u n t held
on J u n e 30,
1935

Principal:

,
$5,219, 500 00
25,972, 656 36

$346,556.760 00
98,401, 755.00
62,103,453 28.
277,493„337 36
264,828,010 64

31,192,166 36 1,049.383,306.28

Interest

$45 338 918 25c
23,100, 562. 274,248,171.96
54,347, 689; 70 V
90,286,652. 70 •
217,321,894.88^

During the fiscal year 1935, $33,600 was received from the Minneapolis & St. Louis Railroad Co. on account* of equipment trust notes.
This payment represents the concluding payment on equipment trust.
notes given to the Director General of Railroadsby various carrierson account of equipment acquired by him and allocated to them after^
termination of Federal control. The total interest, aggregating
$45,338,918.25, includes an adjustment of $44,546.87 in the amount
shown in the 1934 annual report.
Section 204-.—There have been no transactions under section 204
since June 30,1931. Total payments under this section have amountedl
to $10,967,801.80.
Section 207.—A statement showing the principal amount of obligations of carriers acquired pursuant to section 207'of.the Transporta-tion Act, 1920, as amended, receipts on account of principal, and
obligations outstanding June 30, 1933, appears as table 38 on page 370^
of the Annual Report of the Secretary of the- Treasury for 1933.
There has been no change in the status of suchi obligations since that:
date.

REI^ORT OP T H E SECRETARY OP THE TREASURY

Sections 209 and 212.—There have been no transactions under these
isections since June 30, 1934. Total payments to carriers have
^amounted to $532,006,103.30.
Section 210.—This section established a revolving fund of $300,'000,000 to be used for loans to railroads under the conditions set
:forth in a certificate of the Interstate Commerce Conimission authorizing each loan, and also for paying judgments, decrees, and awards
irendered against the Director General of Railroads. No new loans
are being made as the time for making application has expired. The
net expenditures by the Director General during the fiscal year under
this section, after deducting repayments, amounted to $5,649.29,
:making net expenditures by him on this account of $33,636,686.95 to
June 30, 1935.
To.tal loans (including renewal loans and repayments thereof
-aggregating $59,800,000) to June 30, 1935, amounted to $350,600,667,
^repayments amounted to $324,628,010.64, and loans outstanding as
-of that date amounted to $25,972,656.36. Repayments during the
ifiscal year 1935 were made by the following carriers:
^Chicago & Western Indiana R, R. Co
Pernwood, Columbia & Gulf R. R. Co
National Railway Service Corporation, account of the-—
Minneapolis & St. Louis Railroad Co
Wheeling & Lake Erie Ry. C o . . . .
Toledo, St. Louis & Western R. R. Co

.$5,950, OOO 00
2, OOO 00
50,970 01
436,314,97
46,000.00

Total

6,485,284.98

The foUowing statement shows the amount of obligations held on
•June 30, 1935, on account of loans to carriers under section 210 of
the Transportation Act, 1920, as amended, and the amount of
^principal and interest in default as of that date:
'Obligations held on J u n e 80, 1935, on account of loans to carriers under section 210
of the Transportation Act, 1920, as amended, and the amount of principal and
interest in default as of that date
Name of carrier
Alabama, Tennessee & Northern R. R. Corporation
Aransas Harbor Terminal Ry
•^^Charles City Western Ry. Co
_
Des Moines & Central Iowa R. R. Co. (formerly the Inter
urban Ry. Co.)
Fernwood, Columbia & Gulf R. R. Co
Fort Dodge, Des Moines & Southern R. R. Co
Gainesville & Northwestern R. R. Co
•Georgia & Florida Ry. (receiver)
Minneapolis & St. Louis R. R. Co
Missouri & North Arkansas Ry. Co
'National Railway Service Corporation account:
Minneapolis & St. Louis R. R. C o . .
Wheeling & Lake Erie Ry. Co
Salt Lake & Utah R. R. Co
Seaboard Air Line Ry. Co
.Seaboard-Bay Line Co
.-Shearwood Ry. Co
.-.
"Toledo, St. Louis & Western R. R. Co
'^Virginia Blue Ridge Ry. Co.._
'Virginia Southern R. R. Co
.
Waterloo, Cedar Falls & Northern Ry. Co
'Wichita. Northwestern Ry. Co
^Wilmington, Brunswick & Southern R. R. Co
Total

Loans outstanding

Principal in
default

Interest in
default

$114,30O 00
44,304, 67

$13,635, 00
6, 724.45

633, 500. 00
633, 500, 00
10, 000.00
200,000. 00
200,000. 00
75, 000. 00
75, 000, 00
792,000. 00
1,382, 000. 00 1, 382,000, 00
3,500, 000. 00

295, 690. 07

$151, 50O 00
44, 304. 67
140,000.00

66, 730 79
483,883.06
872, 600. 00
157. OOO 00
14,443,887.84
1,256, 000. 00 i,'o99,"ooo.'oo"
7, 60O 00
48, 000, 00
106,000. 00
106,000. 00
38,000. 00
38,000. 00
1, 260,000. 00 1,000,000. 00
381, 750. 00
381, 750 00
90,000. 00
90,000, 00
25, 972,656. 36 6,320,854. 67

65,164,91
53,852. 53
261, 360. 00
957,689. 73
2,243, 237. 04

549,682,80
4.035,468. 24
263,760 00
57,237. 08
20,907.84
1. 001,853.31
263, 407. 50
27, 000. 00
10,116,670.50

REPORT OP THE SECRETARY OF THE TREASURY
Trust junds invested by the Treasury

Adjusted service certijicate jund.—Investments for the account of
the adjusted service certificate fund, created by the act of May 19,
1924, were made during the fiscal year 1935 in special issues of
Treasury obligations bearing interest at the rate of 4 percent per
annum in accordance with the procedure outlined on pages 118-120
of the Annual Report of the Secretary of the Treasury for the fiscal
year 1925.
Investments made during the year amounted to $213,600,000, of
which $50,000,000 represented funds appropriated by Congress under
the provisions of the act approved March 28, 1934; $158,300,000
represented the principal proceeds of maturing notes reinvested; and
$5,300,000 was derived from interest on investments. During the
year $175,900,000 face amount of securities (including $158,300,000
of maturing notes and notes amounting to $17,600,000 redeemed to
meet current payments from the fund) were- redeemed on account of
the adjusted service certificate fund, the proceeds of which, together
with interest thereon, were credited to the fund.
According to reports received by the Treasury from the Veterans^
Administration, net expenditures of the fund during the fiscal year
1935 amounted to approximately $57,000,000, of which about
$31,400,000 represented the net increase in direct loans to veterans.
A statement of the fund as of June 30, 1935, as shown by the books
of the Treasury (exclusive of fund assets held by the Veterans^
Administration on account of bank loans on adjusted service certificates redeemed amounting to $52,000,545.20 and direct loans to
veterans amounting to $1,132,533,489.19) is as follows:
Adjusted service certificate fund, JuneSO, 1935
FUND ACCOUNT

Appropriations:
To June 30, 1934
Available July 1, 1934
Interest on investments:
To June 30. 1934
July 1, 1934, to June 30, 1936..

$1,246,000,000.00
60,000,000 00
•'
$1, 296, .000, 000.00
107,992,297.39
5,711,035. 65

Total-:
Checks paid by Treasurer of the United States, less credits on account of repayments of
loans and interest thereon
Balance in fund June 30. 1935..

113. 703,333.04
1,409,703,333.04
1,253,198,301.15
156,505,031.89

FUND ASSETS »

Investments, 4 percent Treasury certificates of indebtedness
Unexpended balances:
To credit of chief disbursing officer. Division of Disbursement, and disbursing
oflQcers of the Veterans' Administration with the Treasurer of the United States..
To credit of fund on books of the Division of Bookkeeping and Warrants
Total fund assets June 30, 1935

155,500, 000.00
923,280.88
81,751.01
156,505,031.89 - ^

Civil service retirement and disability jund.—The civU service retirement and disability fund was created by the act of May 22, 1920.
During 1935 the Treasury continued to make investments for account
of the fund in special issues of Treasury notes bearing interest at the
rate of 4 percent per annum, in accordance with the procedure outlined in the Annual Report of the Secretary of the Treasury for the
1 Exclusive of assets held by Veterans' Administration.

REPORT OF THE SECRETARY OF THE TREASURY

fiscal year 1926. Total investments amounting to $41,400,000 were
made, of which $12,700,000 represented the proceeds of maturing
notes. Redemptions, in addition to the maturing notes, were made
in the amount of $19,700,000 to meet current payments from the fund.
Total credits to the fund during the fiscal year amounted to $61,912,095.68, of which $30,089,204.72 was on account of deductions
from basic compensation of employees and service-credit payments,
$10,822,890.96 represented interest on investments; $20,850,000 was
appropriated by Congress to fulffll the current liabUity of the United
States Government in connection with the fund, and $150,000 was
appropriated from the revenues of the District of Columbia to cover
its liabUity on account of the fund. The total earnings and profits
on investments to June 30, 1935, amounted to $70,571,880.03.
The foUowing statement shows the status of the fund as of June
30, 1935:
Civil service retirement and disability fund, June 30, 1935

Credits:
On account of deductions from basic compensation of employees and
service-credit payments:
From Aug. 1, 1920, to June 30, 1934..
i $319,463,89L 26
July 1, 1934, to June 30, 1936
30, 089, 204. 72
Appropriations:
To June 30, 1934
Available July 1, 1934...
Interest and profits on investments:
From Aug. 1, 1920, to June 30, 1934
July 1, 1934, to June 30. 1935...

$349,563,096.98

124,450, OOO 00
2 21,000,000 00
69.748,989.07
10.822,890 96

Total
Less checks paid by Treasurer of the United States on account of
annuities and refunds, Aug. 1.1920, to June 30, 1936

145.450.000.00-

70.671.880.03;
665.574.976.01
293,478.686.81

Total

272,096,290 20

Assets:
Face amount
Principal cost
$4,378, 700 Fourth Liberty Loan i H percent bonds.
$4,321,668.79
• 6,884, OOO ZH percent Treasury bonds 1943-45
6, 794,338.03
4,621, 650 ZH percent Treasury bonds 1944-46
4, 661,454.45
6,810, 700 214 percent Treasury bonds 1955-60....
6,721,992. 74
64, 200, 000 4 percent special Treasury notes payable June 30, 1936...
64,200,000.00
44, 000, 000 4 percent special Treasury notes payable June 30,1937...
44, 000, 000 00
72,100,000 4 percent special Treasury notes payable June 30, 1938...
72,100,000.00
45, 200, 000 4 percent special Treasury notes payable June 30, 1939...
45,200,000.00
22, 200, 000 4 percent special Treasury notes payable June 30,1940...
22, 200,000. 00
270,395,050
Unexpended balances June 30,1935:
To credit of disbursing oflScers
On books of Division of Bookkeeping and Warrants
Total fimd assets June 30, 1935

270,099,454.01
1,651,815.27
345,020.92

1.996.836.19
272,096,290 20>

Foreign service retirement and disability jund.—The foreign service
retirement and disability fund was established by section 18 of the
act of May 24, 1924 (43 Stat. 144), and is under the administrative
supervision of the Secretary of State, but under the act the Secretary of the Treasury is directed to make investments from time to
time of such portion of the fund as in his judgment may not be
immediately required for authorized payments, the income derived
from such investments to be credited to the fund as a part thereof.
1 Exclusive of.$l,430,808.84 transferred to the Canal Zone retirement and disability fund pursuant to actof May 2, 1931.
a Includes $20,850,000 appropriated from the General Fund to cover the liability of the United States and
$150,000 appropriated from the revenues of the District of Columbia to cover its liability in connection with
the flnancing of the fund.

EEPOET OF THE SECRETAEY OF THE TREASURY

Investments for account of the foreign service retirement and disability fund were made during the fiscal year 1935 in special issues of
Treasury notes in the face amount of $765,000, bearing interest at the
rate of 4 percent per annum in accordance with the procedure outlined in the Annual Report of the Secretary of the Treasury for the
fiscal year 1927. Redemptions during the year amounted to $509,000
face amount, including $325,000 maturing notes and $184,000 of
notes redeemed to meet current payments from the fund. The net
investments amounted to $256,000.
Credits to the fund during the year aggregated $445,321.29, of
which $179,138 was on account of deductions from basic compensation of employees and service-credit payments, $107,083.29 represented, earnings on investments, and $159,100 was appropriated by
Congress to meet the current liabUity of the Government in connection
with the fund.
The following statement shows the status of the fund as of June
30, 1935:
Foreign service retirement and disability fund, June 30, 1935
Credits:
On account of deductions from basic compensation and service-credit payments:
From May 24,1924. to June 30,1934
1..
$1.618,53.5,62
July 1, 1934, to June 30, 1935
179,138.00
Appropriations:
To June 30, 1934
Available July 1, 1934

$1,797,673.62

1,568.70O 00
159, IOO 00

Interest and profits on investments:
From May 24, 1924, to June 30, 1934
July 1,1934, to June 30,1936....

401,089.17
107,083, 29

Total...
Less checks paid by Treasurer of the United States on account of annuities and refunds,
May 24, 1924, to June 30, 1935

1,727,800.00

608,172.46
4,033,646.08
1,312,038.05

Balance in fund June 30,1935

2,721.608.03

Assets:

FCLCB (LTflOU/flts

$440,000 4 percent
654,000 4 percent
514.000 4 percent
6.57,000 4 percent
428,000 4 percent

special Treasury
special Treasury
special Treasury
special Treasury
special Treasury

notes due June 30, 1936
notes due June 30, 1937
notes due June 30. 1938
notes due June 30. 1939
notes due June 30,1940

2.693.000
Unexpended balances June 30,1935:
Treasurer of the United States, disbursing account..
On books of Division of Bookkeeping and Warrants
Total fund assets June 30,1935

P ' T t T h C V D d t COSt

$440, OOO 00
654,000.00
614, OOO 00
657, OOO 00
428. OOO 00

27.404.12
1,203,91

2.693,000 00

28.608,03
2,721,608,03

Canal Zone retirement and disability jund.-—The Canal Zone retirement and disabUity fund was created by section 9 of the act of March
2, 1931 (46 Stat. 1477), and under section 10 of the act the Secretary
of the Treasury is directed to make investments from time to time of
such portions of the fund'as in his judgment may not be immediately
required for the payment of the annuities, refunds, and allowances
authorized by the act, the income from such uivestments to be
credited to the fund.
Investments for account of this fund in the face amount of $111,000
were made during the fiscal year 1935 in special issues of Treasury
notes bearing interest at the rate of 4 percent per annum in accordance
with the procedure outlined on page 125 of the annual report of the

EEPORT OP THE .SECRETARY OP THE TREASURY

Secretary of the Treasury for the fiscal year 1931. Redemptions to
meet current expenditures from the fund during the year amounted to
$64,000 face amount, making net investments of $47,000 for the year.
Credits to the fund (luring the year aggregated $550,229.82, of which
$459,198.59 was on account of deductions from basic compensation of
employees and service-credit payrnents and $91,031.23 represented
earnings on investments.
The following statement shows the status of the fund as of June
30, 1935:
Canal Zone retirement and disability fund, June 80, 1935

Credits:
Account of deductions from basic compensation of employees subject to
retirement act:
From J u l y l , 1931, to June 30, 1 9 3 4 . . . . . . . . .
$3,189,949.81
July 1. 1934, to June 30, 1935
469,198.69
Interest and profits on investments:
From July 1, 1931, to June 30,1934
July 1, 1934, to June 30, 1935

:..

$3,649,148.40

240,265.78
91.03L 23

Total
Less checks paid by Treasurer of the United States, on account of annuities and refunds,
July 1, 1931, to June 30, 1935

1,587,332.49

Balancein fund June.30,1935.-.
Assets:
Face amount
$1,878,000 4 percent special Treasury notes maturing June
179,000 4 percent special Treasury notes maturing June
93,000 4 percent special Treasury notes maturing June
109,000 4 percent special Treasury notes maturing June
90,000 4 percent special Treasury notes maturing June
:
2.349.000
Unexpended balances June 30,1935:
Treasurer of the United States, disbursing account
On books of Division of Bookkeeping and Warrants

331,297.01
3,980,445.41

2,393,112.92

30,1936
30,1937
30, 1938
30,1939
30,1940

Principal cost
$1,878,, 000.00
179,000.00
93,000.00
109. OOO 00
90.000.00

25^ 750.45
18,362.47

Total fund assets June 30,1935

2,349,000.00

44.112.92
2.393,1^2.92

District oj Columbia teachers^ retirement jund.—The act of January
15, 1920, as amended by the District of Columbia appropriation act
of June 5, 1920, vested, the administration of this fund in the Commissioners of the District of Columbia, except that the funds are to
be held and invested by the Treasurer of the United States. A further
amendment of June 11, 1926, created a reserve fund, provided for
annual appropriations to this end, and provided that investments on
account of such fund shall be held by the Treasurer of the United
States separate from the investments on account of contributions of
teachers. During the fiscal year 1935, the Treasurer acquired by purchase or exchange for account of the deductions fund (derived from
deductions from teachers' compensation) $1,294,250 face amount of
United States, Federal farm loan, and Home Owners' Loan Corporation bonds at a principal cost of $1,382,166.14, as follows:
Glass of security
2% percent Treasury bonds of 1955-00
i H percent Treasury bonds of 1947-62
4 percent consolidated Federal farm loan bonds of 1944-46
4 percent Home Owners' Loan Corporation bonds of 1933-51
Total

Face amount
$190,850.00
621, OOO 00
386,400.00
197,000 00
1,294,260.00

Principal cost
$193,566.24
689,180 63
403,077.40
196,341.87
1,382,166.14

EEPOET OP THE SECRETARY OF THE TREASURY

There was also purchased for account of the Government reserves
fund $258,100 face amount of United States, consolidated Federal
farm loan, and Home Owners' Loan Corporation bonds at a principal
€Ost of $279,484.08, as follows:
Class of security
•2Ji percent Treasury bonds of 1955-60
4H percent Treasury bonds of 1947-62
4 percent consolidated Federal farm loan bonds of 1944-46
•4 percent Home Owners' Loan Corporation bonds of 1933-61.
Total

Face
amount

Principal
cost

$39.000.00
147,000. 00
62,100,00
20, OOO 00

$39,645.94
166,279.38
64,623.75
19,935.01

258. idO. 00

279,484.08

The following statement shows the status of the combined funds
as of June 30, 1935:
District of Columbia teachers^ retirement fund, June 30, 1985
'Credits:
On account of deductions from basic compensation of teachers:
From Jan. 15, 1920. to June 30, 1934
July 1. 1934, to June 30, 1936

$3,694,971.36
296,610 07

Appropriations:
To June 30. 1934
Available July 1,-1934

3,069,940.91
400,000 00

Interest on investments:
From Jan. 15, 1920, to June 30, 1934
July 1, 1934, to June 30, 1935

1.277,416.73
240.26L 40

$3,991,581.43

3,469,940 91

1,617,678.13

Total
8,979,200 47
Less disbursements on account of annuities, refunds, etc., Jan. 16, 1920, to June 30. 1935. 2,710,015.86
Balance in fund June 30,1935
6,269,184.61

Assets:
".

DEDUCTIONS FUND

Face amount
$860,200 i H percent Treasury bonds of 1947-52
122,000 4 percent Treasury bonds of 1944-54
87,000 ZH percentTreasury bonds of 1946-56...
48,000 ZH percent Treasury bonds of 1943-47
142,000 ZH percent Treasury bonds of 1941-43
232, 000 ZH percent Treasury bonds of 1943-46
190,850 2H percent Treasury bonds of 1955-60
182,000 4H percent Philippine Islands bonds
16,000 i}^ percent Puerto Rican bonds
_
55,320 4 percent Federal land bank bonds.
a. 368,880 i H percent Federal land bank bonds
469.400 43^ percent Federal land bank bonds
386,400 4 percent consolidated Federal farm loan bonds of 1944-46
4,139,050

Principal
cost
$956,962.07
123,387,50
87,437.81
49,500 00
137,657.50
232, OOO 00
193,566,24
197,669,56
15,962.57
54,660,95
1,313,830 89
466,980 25
_
403,077,40
• 4. 232.692. 74

GOVERNMENT RESERVES FUND

282.000 i H percent Treasury bonds of 1947-52
313,717,51
12.000 4 percent Treasury bonds of 1944-54
12,285.00
31,000 ZH percent Treasury bonds of 1946-56
31,145.31
199,000 ZH percent Treasury bonds of 1943-47..
204,701.25
178,000 ZH percent Treasury bonds of 1941-43
177,606. 66
39,000 2H percent Treasury bonds of 1955-60..
39,645.94
65,000 i H percent Puerto Rican bonds...
55,109. 56
216,640 4 percent Federal land bank bonds...
208,05O 78
819,600 i H percent Federal land bank bonds
776,281.48
62,100 4 percent consolidated Federal farm loan bonds of 1944-46
64,623.75
1,873.167,14
1,883.340
'
K "
6.106.859.88
Accrued interest paid in 1936 (on investment purchases), repayable in 1936....
5,291.74
'Unexpended balance June 30, 1936, on books of Division of Bookkeeping and Warrants
158,032.99
Total fund assets June 30, 1935

6,269.184.61

REPORT OP THE SECRETARY OP THE TREASURY

Longshoremen^s and harbor workers^ compensation jund.—This fund
was established under the act of March 4, 1927 (44 Stat. 1444, sec.
44), to provide for the payment of compensation for disability or
death resulting from injury to employees in certain maritime employments, and for the iriaintenance of employees undergoing vocational
rehabilitation. Each employer is required to pay into the fund the
sum of $1,000 as compensation for the death of an employee of such
employer resulting from injury where it is determined that there is
no person entitled under the act to receive compensation for such
death. Fifty percent of each such payment shall be available for the
payments on account of injury increasing disability, and 50 percent
shall be available for the payments on account of maintenance for
employees undergoing vocational rehabilitation.
The fund is administered by the United States Employees' Compensation Commission. Moneys not required for immediate disbursement are invested by the Treasurer of the United States.
The following statement shows the status of the fund as of June
30, 1935:
Longshoremen's and harbor workers^ compensation fund, June SO, 1935
Credits:On account of assessments:
To June 30, 1934
J u l y l , 1934, to June 30, 1935

$120,00000
22,000 00

Interest on investments:
To June 30. 1934
July 1,1934, to June 30,1935

14,069.77
4,323.09

Total
Less disbursements on account of current claims and expenses
Balance in fund June 30,1935
Assets: i
Face amount
$16,600 ZH percent Treasury bonds of 1944-46
34,600 i H percent Treasury bonds of 1947-62
11,550 ZH percent Treasury bonds of 1943-46..
10,000 3 percent Treasury bonds of 1951-65
11.000 i H percent Federal land bank bonds
11,000 i H percent Federal land bank bonds
11,000 i H percent Federal land bank b o n d s . .
104.650
Unexpended balances:
Disbursing OflQcer (check book balances)
Division of Bookkeeping and Warrants
Total fund assets June 30,1935

$142, OOO 00

18,382.86

160,382.86
_ 39,707.99
120,674.87
Principal cost
$15,60O 00
38,646. 56
11,550 00
9,959. 38
9,680.48
9.642,97
9, m . 7 7

1,623.71
14,900.00

104,16L16

16.523.71
120,674.87

District oj Columbia workers^ compensation jund:—This fund was
established under the act of May 17, 1928 (45 Stat. 600), which
extended the provisions of the act entitled ^^Longshoremen's and
Harbor Workers' Compensation Act", approved March 4, 1927,
including all amendments thereto, to apply in respect to the injury
or death of an employee of an employer carrying on any employment
in the District of Columbia, irrespective of the place where the injury
* or death occurs. The fund is derived from collections of awards
against employers made by the United States Employees' Compensation Commission, as compensation for death of employees resulting
1 Excludes $9,700 ZH percent consolidated Federal farm loan bonds of 1945-55 purchased but not paid for
until July 1,1936.

REPORT OF THE SECRETARY OF THE TREASURY

from injuries, in each case where no person is found to be entitled tosuch compensation, under the Longshoremen's and Harbor Workers'
Compensation Act as extended to certain employments in the District
of Columbia. Fines and penalties collected in connection therewith?
are also credited to the fund. One-half of each such collection isavailable as compensation for injuries increasing previous disabilities,
the other half being available for maintenance of employees u n d e r going vocational rehabilitation. Any portion of the fund which,,
in the opinion of the Commission, is not needed for current requirements, is invested by the Treasurer of the United States.
The following statement shows the status of the fund as of June 30,.
1935:
District of Columbia workers' compensation fund, June SO, 1935
Credits:
On account of assessments:
To June 30, 1934
July 1,1934, to June 30,1935

$30,460 GO
5, OOO OO
$35,460.00'

....'.

Interest on investments:
To June30, 1934
July 1,1934, to June 30,1936
Total......
Less disbursements on account of current claims and expenses
Balance in fund June 30,1935
Assets:
Face amount
$10,000 2% percent Treasury bonds of 1955-60--.
11.000 i H percent Federal land bank bonds of 1936-66
21,000
Accrued interest paid in 1935 (on investment purchases), repayable in 1936
Unexpended balances:
Disbursing OflQcer (check-book balances)
Division of Bookkeeping and Warrants
Total fund assets June 30,1935

1,393.07
1.063-03

2,456.10
37,oie. 108,698.69^
29.317.41^

Principal cost
$10; 165,63
9^350 43

19, 616.0620,76

883.52
8,897.07

9,780.50^
29,317.41

Library oj Congress trust jund.—Under the act of March 3, 1925-, as
amended, the Library of Congress Trust Fund Board, consisting of
the Secretary of the Treasury, the chairman of the Joint Committee
on the Library, the Librarian of Congress, and two persons appointed;
by the President, is authorized to accept, receive, hold, and administer
such gifts or bequests of personal property for the benefit of or in
connection with the Library, its collections, or its service as may be
approved by the Board anci by the Joint Committee on the Library.
The moneys or securities given or bequeathed to the Board are
required to be receipted for by the Secretary of the Treasury, who isauthorized to invest, reinvest, or retain investments as the Board may
determine. In accordance with the policy adopted by the Board,,
investments and reinvestments of the trust funds are made in interestbearing securities of high rating.
The following statement shows the earnings coUected on. account of
each donation as of June 30, 1935:

REPORT OP THE SECRETARY OF THE TREASURY
Library of Congress trust fund earnings to June SO, 1935
Income account
Total collected to
June 30,
1934

Donation

$821.76
2,234.71
21,352.50
740 12
23,876.86
61,090 07
16, 646. 82
39,129. 96
68.90
58,432. 77

;Babine
-Beethoven..
-Benjamin...
Bowker
'Carnegie
'Coolidge
•Guggenheim
Huntington.
Longworth..
Wilbur
Total-

Collected
during fiscal year
1936

Total collected to
June 30,
1935

$247. 20
507. 36
1,352. 00
95.27
3,484. 90
6, 915. 95
3,813. 78
4, 236.15
158. 04
13,834. 98

$1, 068. 96
2, 742. 07
22, 704. 50
835. 39
27, 361. 76
68, 006. 02
20,460. 60
43, 366.11
226. 94
72, 267. 75

224, 394. 47 .34,645.63

259, 040.10

The following statement shows the principal cash account of each
•donation:
Library of Congress trust fund—principal cash receipts, cost of investments, and
unexpended balances, fiscal year 1985
Principal cash account

Donation

Babine
Beethoven—
Benjamin
Bowker
'Carnegie
Coolidge
Ouggenheim..
Huntington..
Longworth...
Wilbur
,
Total.

Unexpended
balance
June 30,
1934

$38.16
4.00
26.62
45,68

Receipts
during
year

Available
during
year

268. 38
39.60
33.75
973. 05
200. 64

80 00
786.75
745. 25
1,007. 60
1, 764. 72
639. 24

$38.16
104. 75
26,62
45. 68
80 00
1, 055.13
784. 85
1, 041. 25
2. 737. 77
739,88

1, 629.88

6, 024. 21

6,664.09

$100, 76

Cost of investments
charged to
principal
account
during
year

$100, 76
906. 75
705. 25
1, 007. 50
2,700 00
201,50
5, 621, 75

Unexpended
balance
June 30,
1935

$38,16
4,00
26,62
45,68
80,00
148. 38
79,60
33,75
37.77
638, 38
1.032,34

Cash donations aggregating $1,745 were received on account of
the Longworth Foundation. Receipts aggregating $3,279.21 were
received from maturing investments of various donations. The fund
exchanged $2,800 face amount of 4% percent Federal land bank
bonds of 1934-54, which were caUed for redemption on July 1, 1934,
for $2,800 face amount of 4 percent consolidated Federal land bank
bonds due July 1,1946, which are held for various donations. Investments made during the year were as follows:

BEPORT OP THE SECRETAEY OF THE TREASURY

Face
amount

Donation

Beethoven
Coolidge
Guggenheim
Huntington
Wilbur.
.
Longworth
Do

Total

$100
900
700
1,000
200
2,200
600

Principal
cost charged
to principal
account

Securities

4 percent consolidated Federal land bank bonds of 1946.
do
do..
do
do.
do
2H percent Treasury bonds of 1956-60

$100,75
906.75
705.25
1.007.50
201, 50
2.200. OO
60O OO
6,621.75

6,600

The following statement shows the securities held by the Board for
account of each donation as of June 30, 1935. The securities arejheld
in safe-keeping by the Treasurer of the United States and the Federal
Reserve Bank of New York, subject to the order of the SecretaryJ'^of
the Treasury, for account of the Board.
Library of Congress Trust Fund Board securities held June SO, 1935

Name of security

Face
amount
or par
value

Alexis V. Babine donation
American Chain Co., Inc.
Federal land bank bonds
United States Government
Do...
Do
Tung-Sol Lamp Works, Inc., 2 shares..
Tung-Sol Lamp Works, Inc.. 4 shares.

S600
3,800
500
1,000
500

0)
0)

Ra;eof
interest

Class of security

Percent
7 Preferred stock.
4M Farm loan bonds.
iH\ Fourth Liberty Loan bonds of 1933-38.
ZH\ ZH percent Treasury bonds of 11943-45..
2ys\ Treasury bonds of 1955-60.
Preferred stock.
Common stock.

Beethoven Association donation
Canadian National Ry
Consolidated Federal land bank bonds.
William E. Benjamin donation

10,000
100

Standard Oil Co. of Cahfornia

33,800

5
4

Guaranteed gold bonds.
Consolidated farm loan bonds.

Common itock.

R. R. Bowker donation 2
Austrian Government
German Government.
Japanese Government
American Telephone & Telegraph Co.

1,000
2, 000
2, 000
4, 800

7
7

Sinking fundlbonds guaranteed loan.
German external loan.
Sinking fund gold bonds.
Common stock.

Carnegie donation
Commonwealth Edison Co..
Missouri Pacific R. R: Co
New England Telephone & Telegraph Co

52, 000
5,000
25,400

i y \ First mortgage bonds.
First and refunding mortgage bonds.
5
4M First mortgage bonds.

7,000
10,000
3, 750
11.640
2, 600
900
10, 000
2,000
16, 400
13,000
1,000
300
10, 000
6,000

i y \ Guaranteed gold bonds.
Do.
5
First mortgage bonds.
5
iVA Farm loan bonds.
Do.
iyi\
farm loan bonds.
^7 Consolidated
General mortgage bonds.
5 First and refunding mortgage bonds.
First mortgage bonds.
First and refunding mortgage bonds.
5
First
mortgage bonds.
4
3 ^ Treasury bonds of 1940-43.
First mortgage bonds.
5
Common stock.

Elizabeth Sprague Coolidge donation
Canadian National Rys. Co...
Do
1.
Chicago Rys. Co..
Federal land bank bonds
Do
Consolidated Federal land bank bonds
Great Northern Ry. Co
Missouri Pacific R. R. Co.
New England Telephone & Telegraph Co
Public Service Co. of Northern Illinois
Rio Grande Southern R. R. Co
United States Government
Utah Power & Light C o . . .
_.
American Ship Building Co

1 No par.
2 Life interest in six-sevenths of income retained under terms of donation.

REPORT OF T H E SECRETARY OP T H E TREASURY

Library of Congress Trust Fund Board securities held J u n e SO, 1985—Continued

Name of security

Face
amount
or par
value

Elizabeth Sprague Coolidge donation—Con.
American Telephone & Telegraph Co
American Window Glass Co
.
Board of Trade Building Trust of Boston
Commonwealth EdisOn Co
Elgin National Watch Co
Mexican Northern Ry. Co
Public Service Co. of Northern Elinois

$17,100
2,600
700
12,400
6,625
800
5,000

Rate of
interest

Percent

...

Class of security

Common stock.
Do.
Do.
Do.
Do.
Do,
Preferred stock.

Harry F. Guggenheim donation
Consolidated Federal land bank bonds
Harbor Commissioners of Montreal
Archer M . Huntington donation

700
75,000

4
6

Consolidated farm loan bonds.
Guaranteed gold bonds.

Central Pacific Ry. Co
Consolidated Federal land bank bonds.
Missouri Pacific R. R, Co
.
Nicholas Longworth donation

105,000
1,000
49, 600

4
4
6

First and refunding mortgage bonds
Consolidated farm loan bonds.
First and refunding mortgage bonds

United States Government
Do
Consolidated Federal land bank bonds

4,100
600
2,200

4
Treasury bonds of 1944-54.
2H Treasury bonds of 1955-60.
i
Consolidated farm loan bonds.

James B. Wilbur donation
Canadian National Rys
Federal land bank bonds
Consolidated Federal land bank bonds
Public Service Co. of Northern Illinois
United States Government. _
Do
Total

44,000
16,300
200
100, 000
3,000
100,800

5
iH
4
7
33/^
4

Guaranteed gbld bonds.
Farm loan bonds.
Consolidated farm loan bonds.
Preferred stock.
Treasury bonds of 1940-43.
Treasury bonds of 1944-54.

783, 615

United States Government lije insurance jund.—Under the provisions
of section 18 of the act approved December 24, 1919, as amended
March 4, 1923, the Secretary of the Treasury is required to invest
in interest-bearing obligations of the United States or in bonds of the
Federal land banks all moneys received in payment of premiums on
converted insurance in excess of authorized payments. The act approved A4arch 3, 1927, as amended by the Emergency Adjusted Compensation Act of February 27, 1931, authorized the Administrator
of Veterans' Affairs to make loans to veterans upon their adjusted
service certificates out of the United States Government life insurance fund. All of the funds available for investment during the
fiscal year 1935 were used to make loans to veterans or invested in
obligations of the United States. The Administrator of Veterans'
Affairs reported outstanding loans to veterans from this fund, June
30, 1935, on policies and adjusted service certificates, aggregating
$590,149,480.94. The net increase in loans on adjusted service certificates during the year amounted to $37,255,710.36.
Monthly reports are made by the Treasury to the Veterans' Administratioh of all securities in the fund and the principal cost thereof
as the result of investments made by the Secretary of the Treasury,
and periodic verifications of the security holdings are made through
reports rendered to the Administrator by the safe-keeping offices^
The investments as of June 30, 1935, were as follows:

REPORT OF THE SECEETARY OF THE TREASUEY
Government life insurance fund, June SO, 1935
Par value

4H percent Treasury bonds of 1947-52...
4 percent Treasury bonds of 1944-54
3^4 percent Treasury bonds of 1946-56.„
ZH percent Treasury bonds of 1949-52
2% percent Treasury bonds of 1955-60...
4J4 percent Federal farm loan bonds
i H percent Federal farm loan bonds

_
^

Total investments made by the Secretary of the Treasury
Policy loans
...J
Adjusted service certificate loans
Total investment made by Administrator of Veterans' Admin
istration._
Total investments in fund

Principal cost

$41,272,000.00
14.106,000.00
2,200,000.00
300, 000.00
3, 300, 000. 00
32,550,000 00
69, 200,000.00

$42, 762, 867.12
15.078, 333.48
2. 384, 626. 00
311,906.25
3,344,843. 76
32.477, 590.04
69, 742, 644.40

162,928,000.00

166.092,810.06

124, 550 735. 50
465. 598, 745.44

124,550,735.60
465, 598, 746.44

590,149. 480. 94

590.149,480,94

763,077,480.94

756, 242. 290.99

National Institute oj Health gijt jund.—By the act of May 26, 1930
(46 Stat. 379), the Secretary of the Treasury is authorized to accept
unconditional gifts for study, investigation, and research in the
fundamental problems of the diseases of man, and for other purposes.
It was also provided that he may accept conditional gifts, upon the
recommendation of the Surgeon General and the National Institute
of Health. Any such gifts are to be held in trusts and invested by
the Secretary of the Treasury in securities of the United States.
During the fiscal year the Secretary of the Treasury accepted an
unconditional gift of $900 made by the Edgar 0. Grossman Memorial
Committee, composed of the coworkers and friends of the late Edgar
Orrin Grossman, M. D., formerly Medical Director of the United
States Veterans' Bureau, as a tribute to his accomplishments in the
medical care and treatment of former members of the military and
naval forces of the United States. Other unconditional gifts amounting to $62 were also accepted, making a total of $962 received for
this fund.
There were also accepted during 1935 two conditional gifts from
the Rockefeller Foundation amounting to $20,000, of which $5,000
is for the purpose of the publication of a history of county health
work and $15,000 is for the purpose of aiding in any way the completion of the statistical and epidemiological dental survey made
by the Public Health Service in cooperation with the American
Dental Association and State and Territorial health officers, or for
any purpose connected with the presentation to the public of facts
obtained by this survey.
In order to meet expenditures of the institute for the account of
the Chemical Foundation donation, $1,000 face amount of 4}^ percent
Treasury bonds of 1947-52 were sold. The receipts and expenditures
during the year were as follows:

EEPOET OF THE SECEETAEY OP THE TEEASUEY

•'. : National Institute of Health conditional gift fund, receipts and expenditures,
.
fiscal
year 1935
•
.

Unexpended balance June 30, 1934
.
1 . 1 . . . $1,483.60
-Receipts:
'
' .. -.^
• •. Cash donations, Rockefeller Foundation:
'••'
Dental survey
$15,000.00County health work
5,000.00
•-^
- •
.
.... — —
-20,00000
Netearnings collected on investment account of Chemical Foundation...
3^777.81
"'. Principal cost of security sold, during year. Chemical Foundation a c c o u n t . . . i . . . .
1,115.68
Total..
1.• Expenditures, advances to institute:,
Chemical Foundation d o n a t i o n . . . . . . . . .
•^ . Rockefeller Foundation donation, dental survey...
„
,
LTnexpended balance June 30, 1935

..I...

....

..1
$6^027.47
10,548.16

26,377;'()9
'
16,575.-63
9,801.46

The following statement shows the status of the fund as of June 30,
1935:
National Institute of Health conditional gift fimd, J u n e SO, 1935

Credits:
Donations: "
Chemical Foundation..
Rockefeller Foundation

•

Net earnings on investments. Chemical Foundation
Total........
Less advances to meet expenditures on account of the institute:
Chemical Foundation..-..I
•..!•...
.....
Rockefeller Foundation, dental survey
.
Balance in fund June 30, 1935

^..

$100,000 00
20,000.00

•

.......:

=. $19,225.16
10,548.16
•

Total fund assets, June 30, 1935.^...

29,773.32
106,865.,39

Assets:
'
. .
- . ; • • '
^ $87,000 face amount iH percent Treasury bonds of 1947-52, principal cost...'....:
Unexpended balance to credit of the fund on! the books of Division of Bookkeeping and
Warrants
....."
....
.
,
;

$120; 000.00
16,638.71
130,638,71

i..

97.063,93
9,801.46
106.865.39

Alien property trust jund.—Under the act of October 6, 1917., as
amended, and the Settlement of War Claims Act.of 1928, approved
March 10, 1928 (44 Stat. 254), as amended, the Secretary of the
Treasury held on June 30, 1935, Government securities in the face
amount of $27,710,200 for account of the Attorney General,'Alien
• Property Bureau, of which $1,000,000 constituted additional purchases
during the fiscal year 1935.
A statement of the alien property trust fund as of September 15,
-1935, follows:
• . .
. '
Alien property trust fund as of Sept. 15, 1935
Credits:
Trusts... J........-...•.....-....
Earnings on investments, etc
Total

.J..........J..J.....
....:.....-

$37,333.490 47
31.226,453. 57
68,559.944.04

Assets:
•
Principal at
Face amount . .
.
.
• amortized cost
$9,800, OOO 4 percent Treasury bonds of 1944-54...
$10,379,541.03
3,300,000 4M percent Fourth Liberty Loan bonds...:
3,300,00000
..-6,100„000 3H percent Treasury bonds of 1943-45
6.100.00000
• - 350,000 3K'percent Treasury notes maturing Aug. 1, 1936
353,828.13
200;00'0'3Ki percent Treasury notes maturing Sept. 15, 1937
... .
203,000 00
• 10, 200 2>i percent Treasury notes maturing June 15, 1939.;..-...
10,413.-56
500,000 3 percent Treasury bonds of 1951-55
516,193.14
. ' "600,000 ^^^ percent Treasury.bonds of 1949-52.1.-.
.
.621,250 73
3,220 000 2H percent Treasury notes maturing Sept. 15. 1938
3,220, OOO 00
- -4,730,000 2Ji percent Treasury bonds of 1955-60...
....-...4,730,00000
.
, r——:
28,334.226. 59
' 27,710,200 '
Accrued.interest receivable
.
:
.
23.1,826.69
Participating,certificates issued under sec. 25 (e) of the Trading With the
- Enemy Act:
. . -. >
Noninterest-bearing
•
...$21,750,000 00
6 percent interest-bearing.
17,562.096.91
39.302.096.91
Cash with Treasurer of the United States
691.793.95
Totalfund assets. Sept. 15. 1935
16816—36
7

68.559,944.04^

EEPOET OF THE SECRETARY OP THE TREASURY

Checks issued by the Treasury Department during the fiscal year
on account of the alien property trust fund were as follows:
To the Attorney General. Alien Property Bureau, for—
Distribution of income
Administrative expenses
Total..

$200,000
311.500

511,600

General railroad contingent jund.—The general railroad contingent
fund was created by paragraph 6 of section 15 (a) of the Interstate
Commerce Act, approved June 18, 1910, as amended by the act of
February 28, 1920 (41 Stat. 489). Under the provisions of this section any carrier which received for any year a net railway operating
income in excess of 6 percent of the value of the railway's property
held for and used by it in the service of transportation was required
to place one-half of such excess in a reserve fund established and
maintained by and for use of the carrier, the other half to be paid
to the Government for deposit in the general railroad contingent fund.
Under the provisions of section 15 (a) of the Interstate Commerce
Act, as amended by section 206 (a) of the Emergency Railroad Transportation Act, approved June 16, 1933, the Secretary of the Treasury
is directed to liquidate the general railroad contingent fund and to
distribute the fund among the carriers which have made payments
under that section.
A statement showing the distribution by the Secretary of the
Treasury of the general railroad contingent fund as of October 31,
1933, is included in the annual report of the Secretary of the Treasury for the fiscal year 1933 as exhibit 40, page 270. Additional
refunds were made during the fiscal year 1934, as shown on. page 69
of the annual report for that year. During the year ended June 30,
1935, the Treasury made a refund of $30,000 to the Genesee & Wyoming Railroad Co. Only one item remains unpaid, $2,388.61 due the
Central Railroad Co. of Arkansas. The existence of this corporation
has terminated, and it is impossible to make a refund until it is
determined who is entitled to receive payment.
The following statement shows the status of the fund as of June 30,
1935:
General railroad contingent fund, June 30, 1935

Credits:
Excess earnings deposited in Treasury under sec. 15(a) of the Interstate Commerce Act. $10.739,279.57
Interest and profits on investments
3,735,720.97
Total
^...
14.476,000 54
Deduct:
Amounts refunded prior to passage of Emergency Railroad
Transportation Act of 1933:
Illinois Terminal Co
$800,000 00
Tuckerton R. R. Co
2,164. 28
Washington Run R. R. Co
3,167.20
$805,331,48
Amounts refunded to June 30,1935, under Emergency Railroad Transportation Act of 1933. _
13,667.280 45
14,472,611,93
Balance in fund June 30, 1935

2,388.61

Pershing Hall Memorial jund.—Under the act of Congress approved
June 28, 1935 (Public No. 171, 74th Cong.), $482,032.92 of the fund
entitled **Recreation Fund—Army", created by the War Department Appropriation Act approved March 4, 1933, was authorized
to be appropriated for effecting, under certain conditions, a settlement of any indebtedness connected with Pershing Hall, a memorial

EEPOET OF THE SECRETAEY OF THE TEEASUEY

already erected in Paris, France, under the auspices of the American
Legion, Inc., to the commander in chief, officers, men, and auxiliary
services of the American Expeditionary Forces, to the end that such
memorial as so freed from debt may be perpetuated. I t is also provided that any balance remaining after settlement of such indebtedness shall be retained by the Secretary of the Treasury as a special
fund to be known as the ^^ Pershing Hall Memorial Fund." The
Secretary of the Treasury is authorized (a) to invest and reinvest any
part or all of the corpus of this fund so remaining in interest-bearing
United States Government bonds and retain custody thereof; and (b)
upon request of the American Legion, Inc., the Secretary of the
Treasury shall pay to the National Treasurer of the American Legion,
Inc., from time to time any part of the earnings upon the fund for
use in the maintenance and/or perpetuation of Pershing Hall.
Although funds were authorized to be appropriated, no funds were
appropriated during the fiscal year 1935.
Special junds
Colorado River Dam jund.—This fund was established under the act
of December 21, 1928, to provide for the construction of works
commonly referred to as the Boulder Canyon project. All revenues
received in carrying out the provisions of the act are payable into the
fund. Expenditures are made out of the fund under the direction of
the Secretary of the Interior.
The Secretary of the Treasury is authorized to advance to the fund,
from time to time, within the appropriations therefor, j u c h amounts
as the Secretary of the Interior deems necessary for carrying out the
provisions of the act, except that the aggregate amount of such advances shaU not exceed $165,000,000. Of this amount, $25,000,000
shall be allocated to flood control, and shall be repaid to the United
States out of 62 K percent of revenues, if any, in excess of the amount
necessary to meet periodical payments during the period of amortization, as provided in section 4 of the act. If the $25,000,000 is not
repaid in full during the period of amortization, then 62K percent of
all net revenues shall be applied to payment of the remainder.
The Secretary of the Treasury is required to charge the fund, as of
June 30 each year, with such amount as -may be necessary for the
payment of interest at the rate of 4 percent per annum accrued during
the year upon the amounts advanced from the general Treasury and
remaining unpaid, except that if the fund is insufficient to meet the
payment of interest the Secretary of the Treasury may, in his discretion, defer any part of such payment, and the amount so deferred
shall bear interest at the rate of 4 percent per annum until paid.
Under an opinion of the Attorney General of the United States,
dated December 26, 1929, funds advanced from the general Treasury
for the construction costs of the all-American canal are not subject to
the interest charge. To date, funds aggregating $2,421,248.41 have
been advanced from funds amounting to $9,000,000 allocated from
the appropriations made in the National Industrial Recovery Act,
approved June 13, 1933, and the Emergency Appropriation Act of
1935, approved June 19, 1934, for the construction of the all-American
canal.

^EEPOET OP THE SECEETAEY OP THE. "TREASUEY

The Boulder Canyon Proj ect Act provides for the repayment of these
advances, and the Secretary of the Interior has made provision for
such repayment to begin upon the completion of the canal.
On June 30, 1935, the liability of the Colorado River Dam fund to
the General Fund of the Treasury amounted to $86,766,956.75, representing advances in the sum of $80,358,083.40 and interest in the
amount of $6,408,873.35. Upon recommendation of the Secretary of
the Interior and in accordance with the authority contained in section 2 of the act of March 3, 1933, the Secretary of the Treasury deferred for 1 year the payment of the total amount of interest due on
June 30, 1935, of $6,408,873.35.
The status of the advances made to the fund as of June 30, 1935,
was as follows: .
Advances to Colorado River Dam fund, June SO, 1935
Advances from
Fiscal year
Fiscal year
Fiscal year
Fiscal year
Fiscal year

General Fund:
1931
1932
1933
1934
1935

Interest:
Fiscal year
Fiscal year
Fiscalyear
FLscal year
Fiscal year

1931
1932.
1933....
1934
1935

....i

$1,745,866.46
17.018,608.34
19.709. 297. 48
19, .584, 789. 68
22,299,521.44
—:
•
$80,358,083.40
•
25, 631. 58
355.029.92
1,161,488.18
1,933, 449. 58
2,958.905. 67

'
_•
.-

...-.

Total
.:.
Less amount covered into Treasury as miscellaneous receipts....
Total liability to General Fund..

_.,.........

,6.434,504,93
25,631.68
:
> 6, 408,873. 35
_

86.766.956.75

Advances to reclamation jund.—Under the act of Congress approved
June 17, 1902 (32 Stat. 388), there was established in the Treasury a
special fund known as the '^reclamation fund", representing receipts
from the sale of public lands in certain States and Territories to be
used for the construction of irrigation works for the reclamation of
arid lands. Pursuant to the act of June 25, 1910 (36 Stat. 835), the
Secretary of the Treasury advanced to the reclamation fund from the
General Fund of the Treasury $20,000,000.. The act of June 12, 1917
..(40 Stat. 149), provides for the reimbursement of the inoney so advanced through the transfer of $1,000,000 annually from the reclamation fund to the General Fund of the Treasury beginning July 1,
1920, and continuing until full reimbursement is made. Beginning
with the fiscal year 1921 there has been returned to the General
Fund $1,000,000 annually, making a total of $10,000,000 for the 10
years ended with the fiscal year 1930. The Deficiency Act of February 6, 1931, provided for a suspension of the annual payments for
a period of 2 years and the act of April 1, 1932, as amended by the
act of March 3, 1933, provided a further extension until the fiscal
year beginning July 1, 1936.
The Deficiency Act approved March 4, 1931, appropriated an additional advance of $5,000,000 to the reclamation fund from the General Fund, all of which was advanced between April 28, 1931, and
November 30, 1931.
VPayment of interest due June 30.1935, $6,408,873.35 deferred for 1 year under sec. 2 (d) of the act of Dec.
21, 1928, and sec, 2 of the act of Mar. 3. 1933;

EEPORT:;,0P

:THE SECRETARY OP T H E

83:

TREASUEY

The following-'Statement shows the status of the: account as of
June 30, 1935:
- ;
: ^
:;
Charges: '
Advances from the General Fund:
Under act of June 25. 1910
Under act of Mar. 4,1931.....
. Total

.^. .

i..

$20,000 000
5,000,006^

......:......:....

; 26,000,000

Less repayment of advances to June 30, 1 9 3 0 1 . . . . . . . . . . —
Unreimbursed b a l a n c e . . . . . .

.-.—._-

..„..--..

...I..

......
i

10,.000,000 .
15,000,000

;»Installments for 1931-36 suspended.

Division oj Deposits

The Division of Deposits is charged with the administration of.
matters pertaining to the designation and supervision of Government depositaries and the deposit of Government funds in such dcr
positaries. The regulations of the Treasury governing the deposit pf:
public funds in depositaries are incorporated in Department Circulars
Nos. 176 and 92 as amended.
The following statement shows the number and classes of depositaries niaiiitained by the Treasury and the Government deposits held
by such depositaries on June 30,1935:
Number of .depositaries and amount of Government deposits held, on June 30, 1935
by class of depositaries
•
, ! :
.- :

Depositaries .

Federal Reserve banks (including branches)
.
Federal Reserve member bank depositaries:
To credit of Treasurer of the United S t a t e s . . . . . . . .
To credit of other Government oflQcers
Insular depositaries (including Philippine treasury):
To credit of Treasurer of the United States
To credit of other Government officers .
Foreign depositaries:
To credit of Treasurer of the United States
To credit of other Government officers.._•...
Special depositaries....
Total.....:

Number

.12

. . . .
}.
. ...^

}
.._.;;

$102, 236,863. 22

r 7,324, 547. 36
> 1,645 \ 29,210,792,92
r
\

3, 036,906, 49
2, 274,967.08

r
\

2 3,226

968,839,44
1,583,599=68
779,020, 320. 27

4,799

925,656,836.36

...
....

Amount.,

>ln addition 257 branch banks are carried on the depositary list of the Treasury under the designation;
of the parent banks.
,
.
,
. .
2 Includes 1,974 national banks and 1,262 State banks and trust companies, of which 1,835 held deposits'
on June 30,1935;
:•.

During the fiscal year 1935, appro.ximately 1,200 changes and, ad-i
j ustments were effected within the depositary system. These adjust-,
ments are summarized in the following table;
Member
bank depositaries
Designated
....
Discontinued.
Balances increased
Balances decreased

1...1

...

1
..

.1.
1

. . . .
1

92
75
250
115

Special de-'
positaries- •-

211
326^
127
23

EEPOET OF THE SECRETARY OF THE TREASURY

The work of the Division of Deposits during the year was greatly
increased as a result of the establishment and operation of new
Government activities requiring depositary facilities. The sale of
United States Savings Bonds by postmasters throughout the country
and the transfer of accounts of all clerks of United States courts and
United States marshals from the books of depositary banks to the
books of the Treasurer of the United States under the provisions of the
Permanent Appropriation Repeal Act, approved June 26, 1934, necessitated extensive revision of depositary arrangements. Funds of the
Philippine Government also were transferred from the books of
depositary banks to the books of the Treasurer of the United States.
The liquidation of Government claims against depositary banks
declared insolvent proceeded with orderly dispatch.
Treasury Circular No. 176, dated September 2, 1930, was amended
by the addition of an eighth supplement, dated April 23, 1935. This
supplement will be found as exhibit 48 on page 279.
Section oj Surety Bonds
On June 30, 1935, there were 64 domestic companies holding certificates of authority from the Secretary of the Treasury under the act
of Congress approved August 13,1894, as amended by the act approved
March 23, 1910, qualifying them as sole sureties on recognizances,
stipulations, bonds, and undertaldngs permitted or required by the
laws of the United States, to be given with one or more sureties.
There were also 1 domestic company and 5 branches of foreign companies holding certificates of authority authorizing them to act only
as reinsurers on bonds in favor of the United States. The only change
in the outstanding certificates of authority during the year was the
issuance of one additional certificate of authority.
Division oj Bookkeeping and Warrants
The Division of Bookkeeping and Warrants, in the name of the
Secretary of the Treasury, issues all warrants on the Treasurer of the
United States, and under section 10 of the act of July 31,1894 (U. S. C ,
title 5, sec. 255), keeps the official accounts relating to the receipt,
appropriation, and expenditure of the public moneys, covering all
departments and establishments of the Government. Other duties of
the Division include the preparation of the annual digest of appropriations and the combined statement of receipts and expenditures, and
the handling of duplicate checks, outstanding liability claims, budget
matters, special deposit accounts, etc. The Division also maintains
budgetary accounts relating to the apportionment and obligation of
public funds covering all executive departments and independent
establishments.
Statements of the receipts and expenditures of the Government for
the fiscal year 1935, compiled by this Division, are shown as tables 1
and 2, pages 296 to 315 of this report.
Division oj Disbursement
The Division of Disbursement, organized December 16, 1933,
under the provisions of section 4 of Executive Order No. 6166, has
gradually absorbed the disbursing functions formerly exercised by the

REPORT OF THE SECRETARY OF THE TREASURY

principal departments and establishments of the Government located
in Washington, D. C , including the emergency as well as the regular
Government activities, with the exception of the Post Office Department, the Panama Canal, and that portion of the War and Navy
„departments relating to national defense.
On June 30, 1935, the total personnel of the Division was 1,189.
During the year the Washington office of the Division issued 26,210,425
checks, and in addition made twice a month approximately 25,000
payments in cash to Federal employees located in Washington.
The Division of Disbursement continued the offices established in
Oklahoma, Massachusetts, and North Dakota, for the purpose of
disbursing relief administration funds in those States, and, at the
request of the Federal Emergency Relief Administration, established
similar offices in Ohio, Louisiana, and Georgia.
Nineteen regional offices were established during the year by the
Division of Disbursement in the following cities:
Albuquerque, N. Mex.
Atlanta, Ga.
Boston, Mass.
Chicago, 111.
Cleveland, Ohio.
Dallas, Tex.
Denver, Colo.
Helena, Mont.
Kansas City, Mo.
Los Angeles, Calif.

Minneapolis, Minn.
New Orleans, La.
.New York City, N. Y.
'Philadelphia, Pa.
Portland, Oreg.
Salt Lake City, Utah.
San Francisco, Calif.
Seattle, Wash.
St. Louis, Mo.

As of June 30, 1935, the disbursing functions of 298 separate offices
had b'een transferred to these regional offices. By Executive order
the time for completing the consolidation of disbursing functions was
extended to December 31, 1935.
The Division continued the wo rk of making disbursements in connection with emergency purchases of livestock, seed, and commodities under the drought relief program of the Agricultural Adjustment
Administration in offices established for this purpose at Minneapolis,
Kansas City, and San Francisco. An additional office for this purpose was also established in Chicago. As the work under this program drew to a close, the separate disbursing offices were closed and
: the remaining work was transferred to the regular regional disbursing
offices. A temporary office was established and operated for about
6 months at Lexington, Ky., for the purpose of making rental and
benefit payments on tobacco under the Agricultural Adjustment
Administration program. There has also been established an office
in the Philippine Islands, principally for the purpose of making
rental and benefit payments on sugar, but in addition the disbursing
functions of other Federal offices located there have been absorbed.
The duties of the Division of Disbursement in connection with
disbursements under the Emergency Relief Appropriation Act of
1935 have been referred to above.
DIVISION OF APPOINTMENTS

Nuinber of employees
There were 16,958 employees in the Treasury Department in Washington on June 30, 1935, a net increase of 1,593 for the fiscal year.
The principal increase occurred in the Procurement Division as a

EEPOET. OF: THE SECEETAEY OF, THE TEEASURY

consequence of the expanded public works program. In the Biireauv
of Internal Revenue additional personnel was required for the admin-:,
istration of various new tax laws. The principal decrease was in the.
office of the Treasurer of the United States.
In the field service the force expanded from 45,245 on JuneSO, 1934,
to 48,908 on June 30, 1935, a net gain of 3,663. The largest increases
occurred in the field forces of tha Bureau of Internal Revenue and
the Bureau of the Mint, the latter as a result of activities connected^
with gold and the operation of the Silver Purchase.Act.
The number of employees in the departmental service of the Treasury, classified according to bureaus and offices, at the end of each
month, from June 30, 1934, through June 30, 1935, is showii in table"
49, page 436 of this report. A comparison of the number of employees in the departmental and field services of the Treasury oil
June 30, 1934, and Jiine 30, 1935, is contained in table 50, page 437.
- Retirennent of employees

During the fiscal year 1935 there were 596 persons retired from
the departmental and field services of the Treasury Department.
Under the provisions of the Civil Service Retirement Act, as amended,
and of section 204 of the Economy;Act of June 30, 1932, 207 persons
were retired from the departmental service of the Treasury Department, 18 of whom were retired.at their own option before the compulsory retirement age; and 237 were retired from the field service,
17 at their own option. Under the provisions of section 8 (a) of t h e
Independent Offices Appropriation Act of June 16, 1933, whiclT provision expired June 30, 1935, 100 persons in the departmental service
and 52 in the field service, who had served 30 years or more, were
retired because of necessary.reduction of force.
• Three employees in the field service, who had reached the retirement
age, were retained under the authority of the President provided, in
section 204 of the Economy Act; .
- Table 51, page 437, shows the number of persons retired and the
number who have, passed the compulsory retirement age retained, in
the departmental and field services of the Treasury from August 20,
1920, to J u n e 30, 1935.
• BUDGET AND IMPROVEMENT COMMITTEE

The Budget and Improvement Coinmittee is responsible, under the'
direction of the Budget officer, for the preparation and examination of
Treasury estimates of appropriations and for tlie improvement of administrative methods and procedure within the Treasury Department..
In addition to examining all estimates, the committee makes.inquiries
as to the reserves which may be set up under the various appropriations' and considers other matters affecting expenditures of the:
Department.
Subsequent to the submission of the-regular estimates of appropriations for the fiscal year 1936, supplemental and deficiency estimates aggregating $116,856,994 were, received. After examination
by the Budget officer, with the assistance pf the committee, these
estimates were reduced to $116,781,619 and submitted to the Acting
Director of the Bureau of the Budget.

EEPOET .OP: THE/SECRETAEY. OF.THE TEEASUEY

. R e s e r v e s amounting to $2,631,670 were set aside from ordinary
appropriaitions for the fiscal, year 1935 by the Acting Director of the
.Bureau of the.Budget... During the year $1,273,822 was released by
J h e Acting Director, after approval of the committee, leaving
$1,357,848 in reserve at the' end of the year. For the fiscal year
1936, the Acting Director set aside $225,350 in reserve.
For the fiscal year 1937,,heads, of bureaus and offices submitted
estimates for annual and permanent and indefinite appropriations
/aggregating $1,690,654,931. After examination by the Budget and
Improvement Committee, items aggregating $40,573,475 were disapproved in estimates for annual appropriations. There was approved and submitted to the Acting Director of the Bureau of the
Budget for annual appropriations, $243,429,238; for permanent and
:indefinite appropriations, and special funds, $3,030,468; trust funds,
$17,596,750; interest on the public debt, $805,000,000; and public
debt retirements chargeable against ordinary receipts, $581,025,000,
making.a grand total of $1,650,081,456.
COAST GUARD
The following is a summary of the principal operations of the
Coast Guard for the fiscal year 1935, including comparisons with the
preceding year:
1934

1936

Increase (+)
or decrease

(-)
Livessaved or persons rescued from peril
: Personson board vessels assisted
Persons in distress cared for
...
Vessels boarded and papers examined
, Vessels seized, reported, or warned for violations of law...
-Fines and penalties incurred by vessels reported
Regattas and marine parades patrolled
..Instances of lives .saved and vessels assisted
.Instances of miscellaneous assistance
Derelicts and other obstructions to navigation removed or
destroyed
..Value of derehcts and other obstructions recovered
Value of vessels assisted (including cargoes)
' Persons examined for certificates as hfeboat men
.•

6,597
34,767
1,246
31,730
1,401
$94, 600
204
6.861
7.877

1,299
$149,720
276
6,777
7.025

267
$112,100
$47.296,109
5, 917

191
$19,295
$58. 703,679
9,811

5,825
32,881
927
27, 671

-f228

-1,886
-319
-4,069
-102
+$65, 220
-1-72

-84
-862

-76
-$92, 805
-f $11,407.470
+3,894

Protection to navigation
International service of ice observation and ice patrol.—This serv• ice was conducted during the season of 1935 by two cutters and one
125-foot patrol boat, the cutters being assigned to ice patrol duty and
the patrol boat to oceanographic observations. One of the cutters
sailed from Boston, Mass., on March 9 to determine the extent of ice
conditions in the Grand Banks region. I t was found that icebergs
were approaching the North Atlantic Lane Route, United States Track
" C." Accordingly, the patrol w^as inaugurated on March 14, and
steamshijDs were routed to the more southern track " B " a month
earlier than usual. The patrol boat sailed from Boston on March
19 to join the ice patrol force, and the other cutter sailed from New
York on March 22. Throughout the season the two cutters, basing at
Halifax, Nova Scotia, maintained a continuous patrol in the ice
regions, each vessel standing duty in the Grand Banks area for
periods of 15 days. The patrol boat, basing at St. John's, Newfound-

EEPOET OF THE SECRETARY OP THE TREASURY

land, prepared and furnished the patrol force throughout the season
with current maps indicating the direction and velocity of the
masses of water in the Grand Banks area. I n addition to furnishing
information to individual ships upon request, the position of all ice
sighted and reported was broadcast four times daily by the vessel
on patrol. This information was disseminated in radio broadcasts
by the Hydrographic Office. The ice season was normal, reaching
its peak during the period April 22 to May 8, when 341 icebergs were
reported south of the 48th parallel and 20 south of the 43d parallel.
The southernmost berg reached as far south as the 41st parallel during the early part of July. Oh July 9 the patrol was discontinued.
The patrol boat, with the view of gaining further knowledge of conditions bearing upon the ice menace in the North Atlantic, sailed
on an oceanographic survey of an extensive and little-known area
lying several hundred miles east of Newfoundland and south of
Greenland to determine the effect that conditions prevailing in this
region may have on the drift of Arctic ice. The patrol boat will
continue this oceanographic survey until about September 1.
Winter patrol.—The President, on the recommendation of the
Secretary of the Treasury of November 9, 1934, designated 14 Coast
Guard vessels to perforin special winter cruises along the coast for
the season of 1934-35 to aid distressed vessels. The vessels engaged
on this duty cruised 69,087 miles, and afforded assistance to 70 vessels
whose values including cargoes amounted to $2,072,195. There were
609 persons on board the vessels assisted. The vessels boarded in
the interest of United States laws numbered 436.
Anchorage and movements of vessels.—During the year the Coast
Guard maintained supervision over the enforcement of the rules and
regulations promulgated by the Secretary of W a r and the Secretary
of Commerce governing the anchorage and movements of vessels in
ports and in localities where Federal regulations are in force. At
the larger ports, Coast Guard officers, designated as " captains of
the p o r t " , perform this duty, and also cooperate in the enforcement
of the regulations promulgated by the Interstate Commerce Commission governing the handling of explosives by vessels. I n smaller
localities periodic inspections are made, and a surveillance is maintained to insure compliance with the published regulations.
International yacht races.—International yacht races were held off
Newport, R. I., September 15 to September 25, 1934. Under authority of law, the Secretary of Commerce requested the Coast Guard
to patrol and enforce the regatta laws during this event. Fourteen
Coast Guard vessels, seven Navy vessels, a Navy seaplane, and several
private craft conducted the patrol under the command of a desig'nated Coast Guard officer.
E7%f or cement of customs and other la%os
The usual duties of the Coast Guard in connection with the enforcement of the customs, navigation, and motor-boat law^s of the
United States and the customary assignment of Coast Guard vessels
at the principal ports of the country to assist the customs authorities
were continued during the year. Assistance was also afforded to
other branches of the Government in the enforcement of Federal
laws.

EEPOET OF THE SECEETAEY OF THE TEEASUEY

Liquor smuggling.—The resumption of liquor smuggling on the
Atlantic, Gulf, and Pacific coasts n^ar the close of the fiscal year
1934 presented a problem which the Coast Guard was not fully
prepared to meet because of material reductions in appropriations,
personnel, and facilities. As the result, however, of a deficiency
appropriation, the coordination of efforts with other Treasury agencies engaged in the prevention of smuggling, and through the cooperation of foreign governments, the smuggling of bulk cargoes of
alcohol was greatly reduced in volume at the end of the fiscal year
as compared with the peak of April 1935. Numerous seizures of
foreign and domestic vessels and cargoes were made during the
year. The prompt realization of the renewal of smuggling emphasized the value of the maintenance of a highly specialized intelligence
organization within the Service. Furthermore, the maintenance of
an adequate preventive force 'for scouting the waters off our coast
assures prompt action if the traffic recurs.
Patrol in northern waters.—The- regular annual patrol of the
waters of the North Pacific Ocean, Bering Sea, and southeastern
Alaska for the season of 1934, in progress at the beginning of the
fiscal year 1935, was carried on by nine Coast Guard vessels. The
vessels cruised 78,116 miles, assisted 6 vessels, boarded 60 vessels,
afforded medical and dental aid to 3,055 persons, and transported 273
persons. The dental clinic on shore at Unalaska afforded relief to
563 persons. The patrol for the season of 1935 was in progress at
the close of the fiscal year.
Northern Pacific halibut fishery.—The patrol, conducted annually
by the Coast Guard for the Bureau of Fisheries, Department of Commerce, in the interests of law enforcement, was performed during the
year by three cutters and one 125-foot patrol boat. These vessels
cruised 5,949 miles between September 20, 1934, and April 27, .1935.
O onrmiunications
Telephone amd telegraph lines and cables.—The Coast Guard owns
and operates a coastal communication system consisting of telephone
and telegraph lines of approximately 1,522 miles of pole line, 2,699
miles of open wire aerial circuits, 31 miles of aerial and underground
cables, and 642 miles of submarine cable. A number of line and
cable replacement projects, begun during the previous year, were
completed, and the new circuits were placed in service. Underground
entrance cables ,and new switching facilities were installed at many
stations. Old lines were replaced and partial replacement was made
at various points. New submarine cables were laid in several localities in place of old cables no longer serviceable.
A scientific investigation was made of submarine cables purchased
during recent years, and improved designs and specifications were
prepared which will add materially to the life of cables purchased
and laid in the future. Investigations were continued covering new
methods and apparatus to be employed in increasing the efficiency
and life of the telephone plants.
Radio.—The construction of a new radio traffic station at Jacksonville Beach, Fla., was completed; and also new radio stations at the
air stations at Salem, Mass., St. Petersburg, Fla., Biloxi, Miss., and
Port Angeles, Wash. The addition of these new stations has greatly

REPOET OF T H E SECEETAEY OP T H E TEEASUEY

increased, the efficiency of communications in -the divisions in-.-which
they are located.' The radio traffic stations at Winthrop, Mass.,; and
Rockaway Point, N. Y., and the minor radio station at New London,
•Conn., were turned over to the Navy for a trial period of 2 years.
The program, for the standardization, and improvement of radio
installations on vessels .and aircraft w^as continuecL Radio, equipment has'been designed and developed, to meet the special needs of
aviation and practically all interference to radio reception caused by
electricar induction has. been eliminated on planes. The development of radio-direction .finders for. aircraft has progressed, and all
Coast Guard aircraft are now equipped with direction-finding apparatus. The installation of radio equipment in lifeboats and at Coast
Guard stations has progressed and has proved definitely, in many
instances, the value of such a plan. . ;
The Coast Guard continues to-make analytical studies of distress
cases off the coasts of the United States in which: radio plays an
important part. The nuinber of distress calls, made direct to the
Coast Guard, is steadily increasing, indicating a growing dependence
of shipping on the service.
.
' .
An officer of the Coast Guard continued to represent the Treasury
Department on the Interdepartinental Radio Advisory Committee.
. •

Equipmxent

Floating equipment.—On June 30, 1935., there were in commission
in the Coast Guard 36'cruising cutters, 52 harbor craft, 4 special
craft, eighteen 165-foot patrol boats, twenty-eight 125-foot patrol
boats, eleven 100-foot patrol boats, six. 78-foot patrol boats, fiftyeight 75-foot patrol boats, 82 picket boats, and 24 miscellaneous
patrgL boats. Eighty-five seized boats were also in use. This floating equipment does not include the primarily life-saving boat equipment attached to Coast Guard vessels and stations.
The program for the construction of seven 327-foot cruising cutters is stiirunder wayi During the year'five. 165-foot; cutters, four
110-foot harbor cutters, and nine 165-foot patrol boats were com^
pleted and placed in operation.
A number of harbor craft were .transferred from the Bureau of
Customs during the year,, and 26 of these boats are in operation.at
the present time. Three cutters were sold, one was transferred to
the Federal Emergency Relief Admimstration for the use of the
State of Michigan, and one w^as decommissioned. Six harbor craft
were disposed of, three were decommissioned, and two 100-foot
patrol boats were transferred to the Navy Department.
I n addition to the work performed during the year by the repair
depot on vessels of the service, routine and major repairs to
vessels were made under contract with private shipyards and the
various navy yards. Major repairs were accomplished on four cutters. Ten 125-foot patrol boats were sheathed, and. new engines
installed in six other boats of this class.
SmaU boats.—The first 52-foot motor lifeboat, embodying many
modern improvements, was completed at the Coast Guard depot
during the year and assigned to the Sandy Hook Coast Guard Station, N. J . The second such boat will be completed in August 1935,
and will be assigned to Point Adams Coast Guard Station, Oreg.

EEPOET OF THE SECEETAEY OF-THE TEEASUEY

91:

; The pulling an;d motor self-bailing surf boat designs have been
revised to the extent that balsawood buoyancy blocks have been substituted for the side air cases and the planking has been slightly
modified on the interior to give a flush-surface, which insures a
much higher degree of water-tightness than was formerly obtainable.
Work is ill progress on the design of a boat to supersede the 26-foot:
motor launch. Requirements of: this boat call for better seaworthy
qualities and slightly higher speed with increased carr^dng capacity.
Contracts were awarded during the year for two;30-foot rescue
boats of the sea skiff type, nine motor speed boats, and numerous
skiffs, dories, and other miscellaneous boats.
Experimental investigations and tests in the related fields of special
metals, woods, marine equipment, fittings, and outfits were continued,
as were also special investigations and research in connection with the.
accelerated corrosion of sheathing and other definite problems
evidenced by service needs.
.
.
Aviation.—Duving the year air stations were established at Biloxi,
Miss., Salem, Mass., St. Petersburg, Fla., and Port Angeles, Wash.
The air station at Gloucester, Mass., was decommissioned wdien the
Salem air station was commissioned.
Funds were allotted for building new.air stations at Charleston,.
S. Gi, and San Diego, Calif., and for a new hangar and shops a t
Cape May, N. J. Contracts were aw^arded for the building of twO'
airplanes, a radio test plane accepted b}^ the Coast Guard on September 19, 1934, and a convertible seaplane accepted on .February .20,.:
1935. Nine Grumman and ten .Douglas amphibians were procured on
Navy contract during the year and are now in service. Six more
Grumman amphibians are being constructed under Navy contract.
The following statement indicates the activities of the various air
stations and air patrol detachments of the Coast Guard, and shows
the number of planes checked by Coast Guard (life-saving) stations r
Number of planes sighted and checked a t Coast Guard (life-savihg) s t a t i o n s ! 15, 617
Miles cruised by aircraft
527, 756i
Area in square miles searched
•
••--—
6,601,192
Hours in t h e air
L
.iJ
5, 709
Vessels identified by a i r c r a f t - . : - — _ _ .;-:
;
.16,225
Planes identified by aircraf]t
r--—
r- •-.
2,049
Cases of a s s i s t a n c e r e n d e r e d by-aircraft———'-•—•.
^..-:—_-.._^
._—
143
Emergency cases, t r a n s p o r t e d by air
.
42
s t i l l s located and destroyed—
:
-^—
—^
:__
159

Fifteen commissioned officers of the Coast Guard were. graduated
from the Naval Air Station, at Pensacola, Fla., as naval aviators,
and 10 enlisted men of the Coast Guard were graduated from the
same station as aviation pilots.
!
Officers of the Coast Guard established the following world's
records for amphibian planes.: On December 20, 1934, attaining, a
speed of 191.734 miles per hour; on June 25, 1935, attaining a speed
of 173.945 miles per hour over a 100-kilometer course with a payload
of 500 kilograms (about 1,100 pounds); and on June 27, 1935, attaining an altitude of 17,877.243 feet with a payload of 500 kilograms.
Ordnance.—During the year the new shoulder line-throwing equipment was perfected. With a modified .30 caliber Springfield rifle and
a special projectile, a much greater average range has been attained
than was previously possible.
The use of the light type wrecking outfits has. been extended to the
165-foot and 125-foot patrol boats. They are now equipped to

EEPORT OF THE SECEETAEY OF THE TEEASUEY

handle minor demolition operations independently, thereby saving
time and expense in the removal of obstructions to navigation.
The installation of sound-powered telephone systems for fire control and intercommunication has been completed on all electricdrive cutters and greater efficiency in battle practice is expected as
a result. To the same end, deflection converters are being installed
on 13 rangekeepers and the instruments are being modified for use
with 5'V51 caliber guns. One S'V^O caliber antiaircraft gun has been
replaced by a 5'V^l caliber gun, and as soon as funds are available
similar changes will be made on other vessels of the same class.
At the direction of the Secretary of the Treasury training of
armed civilians of the Department in the use of small arms was
conducted in the United States, in San Juan, P . R., and in Honolulu.
At the close of the year 4,564 men were in training. About 3,000
men had completed the requirements for preliminary qualification,
and 1,324 had fulfilled the requirements for advanced qualification.
The ships on w^hich S3^stematic training has been conducted have
made excellent scores in battle practice and their records have stimulated greater interest throughout the service. Marked improvement
was shown in small arms practice.
The cooperation of the Army, Navy, and Marine Corps, which
has made possible greater efficiency and economy in expenditures,
is gratefully acknowledged.
The academy.^ stations.^ bases., repair depot^ engine school^ repair
iase^ etc.
Coast Guard Academy.—During the fiscal year 69 cadets were appointed to the academy, 54 resigned, and 31 were graduated from
the academy. Twenty-six of the graduates received permanent commissions as ensigTis and five received temporary- commissions as
ensigns. There were 84 cadets under instruction at the end of the
fiscal year.
The 1935 practice cruise left New London, Conn., on June 1, 1935.
The itinerary includes United States and foreign ports.
Stations and bases.—On June 30, 1935, 242 Coast Guard (lifesaving) stations were in an active status, and 3 shore bases were
in commission. Rebuilding, repairs, alterations, additions, and improvements were completed during the year at a large number of
shore units, and contracts were awarded and major work was begun
at a number of other shore units.
Repair depot.—In the course of the year 11 Coast Guard vessels
and boats were overhauled, reconditioned, or repaired at the repair
depot, Curtis Bay, Md. The boat building shop at the depot constructed 161 standard and miscellaneous boats.
Engine school and repair base.—The consolidation of the reclamation plant, formerly operated at Base Nine, Cape May, N. J., with
the engine school at Norfolk, Va., has worked to great advantage,
since it has enabled students to take an active part in the w^ork of
reconditioning the various types of internal-combustion engines and
in the conversion of aircraft engines for marine use. On June 30,
1935, there were 36 students under instruction, and it is expected
that in the future 100 men will complete the course each year. During the year the engine school and repair base completely rebuilt

EEPOET OP THE SECEETAEY OF THE TEEASUEY

37 engines, of which 11 were installed in vessels and 23 were shipped
to various units in the field. Approximately 250 pieces of electrical
equipment, such as starters, generators, and magnetos were reconditioned mostly by students under instruction. Repair parts for
certain engines were stocked and issued upon requisition.
Engineering competition
The engineering competition, which is conducted to stimulate
efforts of the personnel and promote a spirit of friendly rivalry,
tends to maintain the personnel and material in the highest possible
state of readiness and efficiency. During the year 30 cruising cutters
and 46 patrol boats took part in this competition.
Personnel
On June 30, 1935, there were on the active list of the Coast Guard,
477 regular and 7 temporary commissioned officers; 84 cadets; 73 chief
warrant officers and 519 regular warrant officers; 154 temporary warrant officers, 152 of whom were on duty with the War Department
under orders contained in Executive order 6169; 9,095 enlisted men,
and 286 civilian employees in the field, 243 of whom were per diem
civilian employees at the Coast Guard depot, Curtis Bay, Md.
Recruiting.—Four main recruiting stations were in operation at the
beginning of the fiscal year, and 3 main stations and 2 substations
w^ere opened during the year. Of 10,873 applicants for enlistment,
1,068 were enlisted, 3,038 were rejected because of physical disability,
and 6,767 rejected for other causes. Loss in personnel, other than
through expiration of enlistments, was very low, and 82 percent of
the men eligible to reenlist did so upon the expiration of enlistments.
Training.—The training courses provided for enlisted men were
availed of by a number of men who desired advancement along lines
for which special training was necessary. The Coast Guard Institute
at New London, Conn., continued to provide means to study for advancement in rating, and to prepare for further training in school
courses. The facilities of the Fort Trumbull Training Station were
also utilized for the training of men after which they were assigned
to field duty. Educational courses of the International Correspondence Schools of Scranton, Pa., and a radio course of the Capitol
Radio Engineering Institute oi Washington, D. C , were also furnished. During the year 535 Coast Guard Institute educational
certificates, 154 International Correspondence Schools diplomas, and
5 Capitol Radio Engineering Institute certificates were awarded.
Ordnance training was carried on at the Armorers' School at the
Coast Guard Depot, Curtis Bay, Md., and at the Naval Gun Factory
at Washington, D. C. Men were also assigned to the Navy Parachute
Materiel School, Lakehurst, N. J., Navy Sound Motion Picture Technician's School, Navy Yard, Brooklyn, N. Y., and the Navy Aviation
Instrument School, Philadelphia, Pa.
Awards of life-saving medals
The Secretary of the Treasury, under the provisions of law,
awarded during the year seven silver life-saving medals of honor in

94;:

EEPOET OF THE SECEETAEY OF THE TEEASUEY

recognition of bravery exhibited in the rescue or attempted rescue
of persons from drowning in waters over which the United States ha^
jurisdiction or upon an American vessel.
Appropriations and expenditures
The following table shdws the amounts appropriated for the Coast
Guard for the fiscal year 1935, together with the balances of appropriations from the previous year, and the expenditures and unexpended balance of each appropriation. This includes an additional
allotment of $294,868 from the National Industrial Recovery appropriation, and allotments from special funds for rebuilding and improving Coast Guard stations,.building or purchase of vessels for ^
the Coast Guard, and working fund, Treasury, Coast Guard (Procurement Division, emergency construction).
Appropriations,, expenditures, and unexpended balances for the fiscal year 1935
Amount of
appropriation,allotment, or
balance

Expended
• and
obligated

$320,944.00
15, 893, 403. 00
1, 470, 500. 00
1,174, 000. 00
- 158,500.00
136, 602. 00
95, 487. 60
183,795.00
1,485,256.00
• • 96, 349.00

$320,933.96
15; 860, 285. 63
.1, 447, 642. 97
1,210,415.85
• 151,813.77
132, 264. 94
101,200.16
167, 382. 23
1,468,-778.06
95, .709. 76

2,106, 699.13
42,000.00
,,80,036.00

1, 235, 408. 33
- 41,738.21
.. 79,317.15

Title of appropriation

Salaries, Office of Coast G u a r d . . . . . . . .
Pay and allowances.......
.......
Fuel and water
Outfitsi...!
........:.....
Rebuilding and repairing stations, etc.
Communication lines
1
..
Civilian employees
...
.
Contingent expenses
....1.........11....1...J..
Repairs to Coast Guard vessels
:
.
Retired pay, former life-saving service
Natioiial Industrial Recovery,-. Treasury, Coast
Guard
...^
.
1...1.
Rebuilding and improving stations
^
Building or purchase of vessels...
Working fund. Treasury, Coast Guard (Procurement Division, emergency construction).
..-..
Additional vessels.
........
^...
Coast Guard Academy 2
'
.__'
_.
Total

76,830.00
117, 525. 00
57,497.00

To:

• +40,000

+10,417
- 3 , 365

76, 830; 06

117.625.00.
-59,180.00

83, ,959 1,191,344.11

'
•
...........I...
---'

$1, 917.04
^68,117.37'.
.22,857.03.
3, 584.15
• 6, 686.-23,
. . 4,337.06
i,-338. 84 ;'
16, 412. 77 •
-16, 477.-94 '
639.24'
871, 290! 80
261.79
' 718.86

-1,'683. 00

To pay and allowances
From:
Collecting the revenue from customs
Collecting the revenue from customs

+$3, 365
-1,458
. -f35, 000

23,495,423.13 22,3.88,038.02

1 Transfers:
:
Froi^a civilian employees, Coast Guard
:..,
To salaries. Coast Guard...
•
.--.--From:
Collecting the internal revenue..:
Collecting the revenue from customs............
.
• Salaries and expenses, Bureau of Narcotics
Salaries and expenses, mints and'assay offices.1....

Unexpended
balance

Trans• ferred i

----

$30,000
2,000
2,000
I . L . . 1,000

.•
.'

35,000
35^000

'..:......!
.

$3,365
.3,365

40,000
10,417

.."

50.417
Outfits. Coast Guard
Civilian employees, Coast Guard

From salaries, Coast Guard
.^j
To salaries and expenses, Division of Disbursement
21933 obligations canceled.

. 40.000
10.417

50,417
1.458
1.458

EEPOET' OF T H E '^SECEETAEY OF T H E TEEASUEY

COMPTROLLER OF THE CURRENCY
Changes in the condition of national banks
The total assets of: the 5,431 licensed national banks on June 29,
1935, aggregated $26,061,065,000,' in comparison with assets of $23,901,592,000 reported.by 5,422 licensed banks on June 30 the previous
year. The deposits, of the licensed.banksJn, 1935. aggregated .$22,518,246,000, or $2,585,686,000 more than the amount reported for licensed
banks a year earlier. The loans and investments totaled $18,085,-.
103,000,' or $1,038,807,000-more-than on June 30, 1934.
The assets and liabilities of licensed national banks on the date of
each report from June 30, 1934, to June 29, 1935, are shown in the
following statement:
. . . . .
Abstract of. reports Qf condition of,licensed national banks on the date of each
report from J u n e 30, 1934, to J u n e 29, 1935
[Dollars in t h o u s a n d s ] J u n e 30,
1934
(5,422
banks 0

Oct. 17,
1934
(5,-466
banks 0

Dec. 31,
1934
(5,467
banks 0

M a r . 4,
1935
(5,451
banks)

J u n e 29,
1935.
(5,431
banks)

ASSETS

L o a n s a n d discounts (including r e d i s c o u n t s ) . . . .
Overdrafts...........
...........
..:..
U . S. G o v e r n m e n t securities, direct.obligations
Securities g u a r a n t e e d b y U . S. G o v e r n m e n t as to
interest a n d p r i n c i p a l . . . ; „ . . - - . . . . _ . . . . . . I
.
O t h e r bonds, stocks, securities, e t c l . . . . .
C u s t o m e r s ' liability account of acceptances
B a n k i n g house, furniture a n d fixtures
O t h e r real estate owned
1.
Reserve w i t h Federal Reserve b a n k s
C a s h in v a u l t . . . . . . . . .
...................
..
Balances w i t h other b a n k s
O u t s i d e checks a n d other cash i t e m s
R e d e m p t i o n fund a n d d u e from U . S.' T r e a s u r e r
Acceptances of other b a n k s a n d bills of exchange or
drafts sold w i t h e n d o r s e m e n t
:....
.....
Securities borrowed
:.......,
.Other assets..
....'.
.

Total.

7, 694; 749 7, 633, 924 7,488, 652 7, 489, 904 7, 365, 226
2, 994
4, 720
3,'315
4,543
3,491
6,645,741 5, 837, 378 6, 262,109 6, 283, 866 6, 077, 724
2 357,
3, 344,
129,
055.
151,
2,497,
352,
2, 798,
• 48;
36,
.

1,408
2,112
181, 468

510,
3 3,570,
137,
654,
158,
2, 509,
418,
3,102,
" 44,
35,
1,201
1,646
191,275

698; 099
830,425 1,095,283
! 3, 495, 7243, 489, 3813 3,543,379'
135,713
117,486
86, 753
653, 842
653, 667
651,463
167,113
162,005
171, 455
2, 525,448 2,772,766 3, 092,178
456, 4i
391,428
405, 513
3,451,175 3, 478, 031 3, 318, 566
57, 60'1
44,546
51, 964
34,133
32, 797
12,060
750
1, 529
203,194

1,556
1,413
194,186

4,592
795
180,623

23, 901, 59224, 811, 39025,629, 580 25, 959, 28326,061,065
LI'ABIIlITllES

D e m a n d deposits, except U . S. G o v e r n m e n t deposits, other p u b l i c funds, a n d deposits of other
banks.
...:
T i m e deposits, except postal savings, p u b l i c funds
and deposits of other b a n k s
.."....--.-..
P u b l i c funds of S t a t e s , counties, municipalities, e t c .
U . S. G o v e r n m e n t a n d postal savings deposits
.
D e p o s i t s of other b a n k s , certified a n d cashiers'
checks o u t s t a n d i n g , a n d cash letters of credit and
travelers' checks o u t s t a n d i n g

8,041,580 8, 848, 799 8, 994, 826 9, 079, 618 9, 674,923
6,075, 625 6, 203, 777 6, 312,1
6, 441, 740 6, 646, 982
1, 499. 013 1, 484, 193 1,641', 603 1,677,924 1, 845, 315
1, 330, 460
971, 059 1, 237, 926 1,041,263
679, 655
2,985, 982 3, 313, 564 3,489,868 3, 775,154 3, 671, 371

T o t a l deposits
19, 932, 660 20,821, 392 21, 676, 303 22,015,699 22, 518, 246
Secured b y pledge of loans and/or investments.....
2, 523,159 2,100,445 2, 448,174 2, 278, 513 2,115,605
N o t secured: b y 'pledge bf loans and./or
investments.
1
1...1...I
J.. 17, 409, 501 18, 720, 947 19, 228,129 19, 737,186 20,402, 641
Circulating notes o u t s t a n d i n g —
:
A g r e e m e n t s to repurchase U , S, G o v e r n m e n t a n d
other securities sold
...Bills p a y a b l e
Rediscounts

698, 293

665,845

654,456

627,022

222,095

4,399
13, 672
2,007

4,432
8,207
579

2,361
7,342
383

6,512
10,427
340

4,194
3,989
654

1 Licensed b a n k s w h i c h were o p e r a t i n g on a n u n r e s t r i c t e d basis.
2 I n c l u d e s H o m e O w n e r s ' L o a n C o r p o r a t i o n 4 p e r c e n t b o n d s , g u a r a n t e e d b y t h e U n i t e d S t a t e s as to
i n t e r e s t only, t h e a m o u n t of w h i c h w a s n o t called for s e p a r a t e l y .
3 I n c l u d e s H o m e O w n e r s ' L o a n C o r p o r a t i o n 4 p e r c e n t b o n d s , w h i c h are g u a r a n t e e d b y t h e U n i t e d .
S t a t e s as to i n t e r e s t o n l y .

16816—36—-8

EEPOET OP THE SECEETAEY OF THE TEEASUEY

Abstract of reports of condition of licensed national banks on the date of each
report from June 30, 193Jf, to June t9, 1935—Continued
[Dollars in thousands]
June 30.,
1934
(6,422
banks 0

Oct. 17,
1934
(5,466
banks 0

Dec. 31,
1934
(5,467
banks 0

Mar. 4,
1935
(5,451
banks)

June 29,
1936
(5,431
banks)

LIABILITIES—Continued
Obligations on industrial advances transferred to the
Federal Reserve bank
Acceptances of other banks and bills of exchange or
drafts sold with endorsement
Acceptances executed for customers
Acceptances executed by other banks for account of
reporting banks
Securities borrowed
Interest, taxes, and other expenses accrued and unpaid
Dividends declared but not yet payable and
amounts set aside for dividends not declared
Other liabilities
Capital stock (see memorandum below).
Surplus
Undivided profits, n e t . .
Reserves for contingencies
Preferred stock retirement fund.

37
1,408
133,221

1,201
137,892

750
138, 939

1,556
119,096

4.592
85, 699

6,683
2,112

6,497
1,646

4,717
1,529

6,202
1,413

8.171
795

41, 741

53, 898

38, 982

48, 751

42,335

64,363
, 737,827
854,057
257,311
151, 267
571

22,642
4,324
5,399
21,004
50,187
61,188
49, 896
62, 936
1, 772, 513 1, 786, 409 1,804, 739 :, 809, 503
845,335
837, 888 834, 878
831, 846
286,184
261,491
283, 557
297,967
141,880
143, 728
151, 345
143, 951
2,320
913
2,046
3,151

.23,901, 59224,-811, 39025,.629,.680 25,'.959,- 28326, 061,065

Total.
Memorandum:
Par value of capital stock:
Class A preferred stock.
Class B preferred stock.
Common stock
Total.
Loans and investments pledged to secure liabilities:
U. S. Government obligations, direct and/or
fully guaranteed
Other bonds, stocks, and securities
Loans and discounts (excluding rediscounts)
Total..

464, 752 492, 685 603,914
401.989
444, 626
17,178
19, 389
21, 208
10,081
15, 205
1. 326, 722 1,313,997 1, 306, 224 1, 294, 374 1, 288,848
1, 738, 792 1, 773,828 1, 788,164 1,806,448 1,813,970
2,606,142 2.404,487 2, 695,454 2, 575, 262 2, 004,611
778,882
991,388
847,317
744, 862 720, 798
84, 978
102,226
88, 210
71, 278
62, 627
3, 699, 756 3, 340, 014 3, 559, 314 3,391,402 2, 778, 036

Pledged:
Against circulating notes outstanding
Against U. S. Government and postal savings deposits
.
Against public funds of States, counties,
school districts, or other subdivisions or
municipalities
Against deposits of trust department
Against other deposits
Against borrowings.
With State authorities to qualify for the exercise of fiduciary powers
For other purposes
Total.

656, 659

226.444

1.445,692 1,127.074 1,331,411 1.153.407

805. 797

724,566

695, 595

975,448
249, 491
176, 768
26, 387

952, 021
270, 849
177, 581
15,116

82,902
18, 602

84, 593
17,185

683, 797

986,862 1.022.472 1.067. 782
411.138
286, 573
289,009
155, 892 154, 086
157,685
11.992
12.804
6,358
85, 206
17, 581

85. 246
18,819

86. 722
17.110

3. 699. 766 3.340.014 3, 559.314 3, 391. 402 2. 778.036

Reopening and reorganization of national banks
On July 1, 1934, there remained in conservatorship, pursuant to
the President's proclamation of March 6, 1933, 95 national banks
with total (ieposits of $98,079,000. During the fiscal year 1935 the
program with respecit to reorganizing unlicensed national banks
was completed, the last remaining conservatorship having been
terminated on February 6, 1935.
Of the above-mentioned banks, 83, with deposits aggregating
$91,059,000, were licensed to reopen under old or new charters
or were absorbed by other national banks; 4, with deposits of $491,-

EEPOET OF THE SECEETAEY OF THE TREASUEY

000, were placed in voluntary liquidation or received authorization
for the sale of their assets to State banks; and 8, with deposits of
$6,529,000, were placed in receivership.
At the close of the banking holiday, March 16, 1933, there were
1,410 national banks unlicensed (including 10 State banks in the
District of Columbia, which are under the supervision of the Comptroller of the Currency), with total deposits of $1,955,072,000. I n
addition there were 6 banks for which licenses were granted but
later revoked and 1 bank which suspended business prior to the
banking holiday, bringing the total unlicensed banks to 1,417, with
deposits of $1,971,960,000.
These 1,417 unlicensed banks were disposed of as follows: 1,096,
with deposits of $1,808,060,000, were reorganized under old or new
charters or absorbed by other national banks; 31, with deposits of
$11,513,000, were placed in voluntary liquidation or acquired by
State banks; and 290, with deposits of $152,387,000, were placed in
receivership for liquidation under the supervision of the Comptroller
of the Currency.
Summary of national ba/nks, licensed and unlicensed, from July 1, 193Jf, to June
30, 1935
[Dollars in thousands]
Number

Status of banks
Unlicensed banks:
Total. July 1.1934

Deposits i

$98.079

98,079

5,422

17,423,984

5.431

17, 479, 388

NumChanges, July 1, 1934, to June 30, 1935:
ber Deposits
Reorganizations under old charter or new charter or absorbed
by another national bank
83 $91,059
Voluntary liquidation or left the national banking system... 4
491
Placed in receivership
_
8
6,629
Total, June 30,1935
Licensed banks: 2
Total, July 1,1934
Changes, July 1, 1934, to June 30, 1935:
New charters issuedLicensed under old charter.
Restored to solvency

Increase for year

Number , Deposits
131 $123.144
7
1,966
3
356
141 12.5,466

Voluntary liquidations
Placed in receivership
Consolidations
Revocation of hcenses

122
1
8
1

69,682
233

Reduction for year

132

70,062

147

Net increase for year
Total, June 30, 1935

65,404
:.

Total, June 30,1936 (deposits as of June 29,1935. call)

22, 518, 246

1 Deposits, unless otherwise indicated, are taken from condition reports as of Dec. 31, 1932, and conservators' first reports. In the case of new banks, deposits are approximately as of opening date.
2 The number of licensed banks in various classifications in this summary difTers from the number of
banks in similar classifications in the table on p. 98, owing to the fact that only such banks as were in active
operation during all or part of the fiscal year are included in this summary, whereas the figures in the table
on p. 98 concern the number of banks based on their corporate existence, whether or not they were active
' during the period.

REPORT OF THE SECRETARY OF THE TREASURY^

Sumjmary of changes in'merrhbership iri the national banking syst eirt;
The authorized common capital stock of the 5,463 national banks,
in existence on June 30, 1935, was $1,292,854,881, a decrease during
the year of $61,573,860; and the authorized preferred capital stock
was $526,035,287, an increase of $113,071,687. The net increase in.
capital stock'w^as $51,497,827. During the year charters were issued;
to 128 national banking associations, of which 25 had common stock,
only, aggregating $2,535,000; the remaining 103 banks had an aggregate of $7,077,000 common stock anci $7,903,000 preferred stock; ,. ,
During the year 899 existing national banks, took advantage of v
the provisioiis of the act of March 9,: 1933, and increased their capital by the issuance of preferred stock of an aggregate par value, of
$119,263,000, wdiile 218' banks with preferred .stock effected retire->
ments of an aggregate par value of $13,426,813. Although charters
were issued during the year'to 128 banks, there was a net decrease;
of 170 in the number of banks—that is, from 5,633 to 5,463—by
reason of voluntary liquidations, receiverships, and.eonsolidations. >
Changes in the number and capital stock of national banks during
the fiscal year 1935 are.'shown in the following summary:
:.
Organization, capital stock changes, and liquidations of natioiial banks during
the'fiscal year 1935
Capital stock
Number
of banks

Charters granted
::.
Issues of preferred capital stock (899 banks) 2...
Increases of common capital stock (149 banks) 3
Restored to solvency
...
'

1 128
25

Total.

Common
$9,612,000
8,042, 860
1, 77.5,000
19,429,860

Voluntary liquidations....
..:...
Receiverships ^
Decreases of capital (643 banks) ».
Closed under consolidation (actof Nov. 7,1918) and capital decreases
incident thereto, j
L
Total.
Net increase in preferred capital stock
Net decrease in banks and common capital stock
Charters in force June 30, 1934, and authorized capital stock.
Charters in force June 30, 1935, and authorized capital stock.

Preferred
$7,903,000
119,-263,000

127,166,000

265
58

29, 615, 250
667, 500
8,235,020
43, 791,350 "i3,"426,'8i3

332

82, 013,720

372,100
14, 094,313
113, 071, 687

8 170
61, 573,860
5,633 1, 354,428, 741 412, 963, 600
5,463 1,292-854, 881

526, 035, 287

1 103 of these banks had both common and preferred capital stock.
2 Includes 1 increase of $250,000 which was efiected in connection with a consolidation under the act of
Nov. 7, 1918. :
3 Inclu'des 72 increases aggregating $2,151,550 which were effected wholly or in part by common stock
dividends and 1 increase of $90,000 by conversion of .preferred capital stock to common capital stock.
* Includes 9 banks with aggregate capital stock of $1,010,000 which had been previously reported in voluntary liquidation. Oue receiver was appointed under the act of Apr. 23,1930.. .
•'
5 Includes 218 preferred capital stock retirements.
6 Net decrease in number of banks in existence after adjustment of the number of receiverships for 9
banks previously reported in voluntary liquidation.

BUREAU OF CUSTOMS

Collections
The fiscal year 1935 was the second successive year since 1929 in
which customs coUections increased over those for the preceding year.
Total collections of $346,514,550 represented an increase of 10.3 per-

EEPQET OE THE. SECEETAEY :0F: THE -^TBEASXJBY

f}cent over 1934 and 37.9 percent over 1933. This; increase, was
.largely the result of increased coUections from duties on imported
lliquors and wines and on imports of, relatively large quantities of
- agricultural products and their d^riva;tives, largely in consec^uencie
,-of the drought in the summer of 1934. Collections, of duties on
/imported liquors and wines in 1935 amounted to $41,018,755 as
:.-compared, with. $24,023,703 collected during the last 7 months .of
•the fiscal year 1934 following repeal of the eighteenth amendment.
Customs collections and refunds for the fiscal years 1934 o^fid 1935
[Oh basis of accounts of Bureau of Customs]
1934
''Collections:
Duties
Miscellaneous:
Sale of unclaimed and abandoned merchandise..
Fines
Liquidated damages .
•.
..
Sale of seizures (including forfeitures)
All other customs receipts _ .
...
•'......
Total miscellaneous
Refunds:
Excessive duties..
Drawback payrnents,
Total refunds . .

.
......

1935

$344,943.964

$313,094,971
$76, 357
310, 684
239, 094
896,070
48,381

.'
.

- '

$133,377
421,469
202,798
150,099
55,760
963,493

1,670,586

,314,068.464

346,614,550

....

Total receipts

6,849,243
8,076,988

. ...

7, 217.114
13,813,853
21, 030,967

13,926.231

Volume oj business

Entries oj merchandise.—The number' of entries of merchandise
increased 12.1 percent, from 2,140,414 in 1934 to 2,399,263 m 1935.
All types of entries contributed to this increase.
: Vessel J airplane ^ and highway traffic.—The number of vehicles and
.passengers entering the United States from abroad increased in
practically all cases during the> fiscal year,1935 compared with the
{preceding year, as shown in the following detailed statement:
.^.Number of vehicles and persons, entering the United States from abroad, fiscal years
193i and 1935
. .
1934
.. Vehicles:
Automobiles and busses.
Documented vessels
Ferries and other vessels.
Passenger trains
Airplanes-...
Other vehicles
Total.
.'Passengers by:
Automobiles and busses.
Documented vessels
Ferries and other vessels.
Passenger trains
Airplanes.:
Other vehicles
-Pedestrians
Total

-...

1935

Increase ( + ) ,
decrease ( - )
Percent
+4,1
+5,3

t, 929,186
27, 308
188,402
38,420
. 4,347
308.363

9, 293, 535
28, 763
189, 683
35, 836
4, 816
323,952

,496,026

9,876, 685

+4.0

24, 052, 731
754,190
2, 809,658
905, 021
. 19, 624.
1, 502, 368
9, 635, 860

25, 604,405
811, 665
2,626,930
936,538
27,001
1,548, 857
10,174, 956

+6.6
+7.6
-6.5
+3,6
+37, 6
+3,1
+5,6

39,679,462

41,730,352

+6,2

+.7

-6.7
+10.8
+6.1

100

REPORT OF THE SECRETARY OF THE TEEASUEY

Drawback transactions.—The number of drawback entries increased
11.9 percent in 1935, 17,319 such entries having been made in 1934,
and 19,377 in 1935. Drawback payments amounted to $13,813,853
in 1935 as compared with $8,076,988 in 1934, an increase of 71 percent. Of the notices of intent to export with the benefit of drawback,
160,609 original notices were filed in 1934 and 177,777 in 1935; and
50,608 in 1934 and 66,814 in 1935 were forwarded to other districts
for final disposition. The total number of notices of intent handled
during 1935 was, therefore, 15.8 percent greater than during 1934.
Under authority of section 318 of the Tariff Act of 1930, the
President, by proclamations dated November 8, December 21, and
December 22, 1934, and January 7 and AprU 1, 1935, declared an
emergency to exist and authorized the Secretary of the Treasury to
extend the time during which merchandise imported during 1929,
1930, 1931, and 1932 may remain in warehouse under the provisions
of sections 557 and 559 of the Tariff Act of 1930; the time during
which proof may be furnished that wool or camels hair imported or
withdrawn from bonded warehouse conditionally free of duty, under
bond, during 1930, 1931, and 1932 has been used in the manufactures
prescribed in paragraph 1101 of the Tariff Act of 1930; and the time
within which articles manufactured or produced with the use of
merchandise imported during certain periods of 1930, 1931, and 1932
may be exported with the benefit of drawback under section'313 of
the Tariff Act of 1930. Pursuant to these proclamations, the Secretary of the Treasury issued Treasury Decisions 47367, 47473, 47474,
47486, 47519, and 47662 granting the extensions authorized in the
proclamations.
Enjorcement activities
Seizures.—The total number of seizures made during'1935 for
violations of the customs laws was 20,896, a decrease of 17,945 from
the previous year. The greater part of the decrease reflected the
decline in the number of lottery seizures from 22,883 in 1934 to 9,313
in 1935, due to the practice which has been adopted pf transferring a
large portion of these cases to the Post Office authorities. The number of liquor seizures also declined following repeal of the eighteenth
amendment and was 5,224 in 1935 as compared with 11,721 in 1934.
Although the number of seizures declined during 1935, the total
value of seizures increased to $2,403,910, of which $222,214 represented the value of seized distUled malt and fermented liquor which
was not included in the value of seizures reported for 1934. On a
comparable basis, the value of seizures was $2,181,696 in 1935 and
$1,115,492 in 1934, or an increase of 95.6 percent in 1935. The
greater part of this increase was due to larger seizures of alcohol,
amounting to 138,040 gallons valued at $1,417,493, as compared with
44,924 gaUons valued at $345,443 during 1934. The quantity of
liquor seized declined from 148,173 gallons in 1934 to 23,273 gallons
in 1935. Seizures of malt liquor also declined from 9,865 gallons in
1934 to 668 gallons in 1935. Liquor seizures during 1935 were confined almost enthely to the Atlantic and Gulf coasts and the Rio
Grande River, and the majority of alcohol seizures were made along
the Atlantic coast.
The number of merchandise seizures during 1935 increased almost
80 percent from 3,057 to 5,448, with a corresponding increase in value

EEPOET OF THE SECEETAEY OF THE TEEASUEY

101

from $227,104 to $307,712. The value of narcotic seizures also
showed a moderate increase, from $40,869 in 1934 to $65,663 in 1935.
In connection with the violation of customs laws, 714 automobUes,
99 boats, and 6 airplanes, with an aggregate value of $390,828, were
seized, a decrease of 72 automobUes, 62 boats, and 8 airplanes from
the number seized in 1934. Customs officers also effected 2,594
seizures for other agencies of the Government, and detained 713
persons for violation of immigration, narcotic, and other laws.
Fines, penalties, etc.—Collections of fines, penalties, etc., because
of violation of laws pertaining to the Customs Service, aggregated
$1,445,848 as compared with $774,366 during 1934. Of these
amounts, $165,441 for 1935 and $88,249 for 1934 represented the net
proceeds from the sale of the seized articles by collectors of customs.
Sales by order of court yielded $274,961 in 1935, or almost seven
times the amount received from this source during the previous year.
A large portion of the sales by both the collectors and the courts consisted of liquor and alcohol.
Undervaluations and false invoicing, aggregating $313,299, were
responsible for over one-fifth of the collections of fines, penalties, etc.,
for 1935. Penalties for faUure to declare foreign merchandise during
the last 2 years were responsible for only 5 percent of the total fines
collected, whereas in 1933 and prior years they constituted from onefourth to one-half of all fines collected.
Smuggling
Through the activity and vigUance of customs field officers, substantial progress was made during the year in the detection and suppression of smuggling. The work of the customs personnel with
respect to violations of customs laws and related statutes continued
an important factor in the successful conclusion of a number of
smuggling cases.
The system of handling criminal cases in connection with smuggling
has resulted in securing a high percentage of convictions. All criminal
cases incident to seizures effected by the Customs Service were investigated, reported, and followed through the courts by customs
agents who collaborated with the United States attorney in the actual
presentation of testimony during trials.
During the year an investigation into the smuggling of grain established the fact that there had been smuggled into the United States
approximately 22,000 bushels of wheat valued at $27,000, including
duty. Many individuals were indicted in connection with this
movement, and a majority of them pleaded guilty and were sentenced
by the Federal courts.
The Customs Agency Service, in cooperation with the customs
border patrol, developed a major conspiracy case involving the smuggling^'of approximately 90,000 pounds of butter over the international
boundary between Canada and the United States, which resulted in
the institution of criminal proceedings against six individuals.
Many investigations into the smuggling of lottery tickets and
foreign sweepstakes were made. The principal seizure was effected
at Philadelphia, where 600,000 tickets, having a sale value of $900,000,
were found concealed in a shipment of baled rags.

102

EEPOET OF THE SECEETARY' OF THE TEEASUEY

Other smuggling-prevention activities covered a large field of corii. moditifes, including fishnets, jewelry, watch movements, and telephone
sets. In one case, involving the sriiuggling of diamonds and watch
movements from a Belgian concern, the apprehension and conviction
effected by the customs personnel put an end to a notorious organization known to have been in existence fpr at least 6 years.
During the year close cooperation was.maintained with all enforcement agencies of the Government, and in particular with the coordinators (Coast Guard officers assigned by the Secretary to coordinate
enforcement activities looking to the detection and prevention of the
smuggling of liquor, alcohol, and narcotics) of the areas including the
several customs agency districts.
Intensive investigation of liquor-smuggling activities of a British
Columbia distUlery company was conducted during the year, resulting
.in the indictment of two of its controlling officers by a Federal grand
jury at Seattle on charges of conspiring to violate the Tariff Acts of
1922 and 1930. After an investigation by customs personnel of
another Canadian corporation on similar charges, an offer in compromise of $225,000 was made by the company..
The increased activities of the Customs Service with respect to the
prevention of sinuggiing of narcotics resulted, in the, seizure of com- para tively large quantities of these drugs, and the indictment and
sentence of several members of large narcotic-smuggling organizations.
Miscellaneous
Under the provisions of the, act approved June 18, 1934 (48 Stat.
L. 998, ch. 590), for the establishment, operation, and maintenance of
foreign trade zones in ports of entry in the United States, the Foreign
Trade Zones Board (composed.of the Secretary of Commerce, Secretary of the Treasury, and Secretary of War) on June 29, 1935, issued
regulations for the administration of the act. Many legal questions
arose and were considered by the Bureau of Customs in connection
with the forrnulation of these regulations..
The Bureau of Customs also participated actively in the consideration of the naany legal questions arising in the administration's
.reciprocal tariff bargaining program... During the year reciprocal
trade agreements providing for substantial reductions, in duties at home
-atid abroad were negotiated with 5 countries, and on June 30, 1935,
negotiations were pending'with 13 other countries. I n ; addition to
assisting in the formulation of the text of these agreements, particularly the parts which result in modifications of the tariff laws, the
Bureau of Customs prepared and disseminated information and instructions to facilitate the administration of the provisions of agreements in effecit, and to interpret language in the. agreements about
which controversies had arisen.
o

Investigative Unit
Port examinations.—Duihig the fiscal year the Port Examination
Commission of the Customs Agency Service made examinations of the
accounts and procedures in seven collection districts, including NewYork, with the result that numerous irregularities in the manner of
transacting custoihs business were corrected.

EEPbE;T 0P^THa5'feiE(5RETAfiY:;DF^T^

103

Undervaluation.-—Investigation of undervaluation cases continued
as an important factor in the work of customs personnel both at home
and abroad. Because of the'inc'reased vigilance on the part of officers
at all ports there was an apparent decrease in the efforts of dishonest
importers to evade the payment of lawful duties. Recoveries made
as a result of the investigations aggregated $120,948 as compared with
$284,590 in 1934.
Criminal cases.—yLemj investigations were conducited during the
year into the false invoidng of imported merchandise. Special
attention was also given to the question of the foreign market value of
merchandise imported from Mexico. Numerous cases have been discovered where merchandise from that country has not been assessed
with the correct aniount of duty. I t is believed that as a result of
these investigations appraising officers throughout the United States
are for the first time afforded correct information as to the value
in Mexico of iinported merchandise, which covers a wide range of
conimodities.
Employees of the Investigative Unit have played a major part in
the results, elsewhere referred to .in this report, accomplished by the
Customs Service. Many inyestigations were; conducted into the
false invoicing of imported merchandise, and a vigorous effort has
been manifested by the customs agents to correct this unlawful
practice.
I t was found in one case t h a t the importer was efi'ecting a fraud
upon the revenue by deducting an improper amount as trade discounts. The result of the investigation was reported to^ the United
States Attorney General for proper action, I n another case involving
the same practice, the Attorney General .accepted $20,991 from the
importer, as an offier in compromise in satisfaction of the Govern-,
ment's claim for duties, interest, and forfeitures yalue accruing on a
series of importations made at Los Angeles, San Francisco, and
Seattle.
'
'
:
Customs joreign service.—The ioieign ser
of the Customs Service continued their efforts to establish foreign market values
of merchandise exported to the United States, and were called upon
from time to time to.make investigations^with respect to dumping,
to the end that imported merchandise might be properly appraised.
They also rendered invaluable service through their cooperation in
the detection of narcotic smuggling.
:.
Customs injormatipn.exchange,-TrTixis^hrsineh^^^^ the .Customs Agency
Service is directed by supervising customs agents and is the medium
employed for disseminating all classes of information with respect to
foreign-market values, classification of imported merchandise, and
other pertinent and related customs data. I t is likewise a clearing
house for requests.for-foreignin-vestigations-by.appraising officers and
for reports submitted by Treasury attaches. The following statement
summarizes the activities of thie exchange during the year:
••

Number

Appraisers' reports of values received
.......1...'..
'1...111
_"„...
Appraisement appeal reports'received'.
..1...1...
..."
..
.........1
.
Changas in value circulated
..
^
'..I....
Requests for investigations abroad.
,..-.....-...l"....-.r..'.J.-."...'...'."........•.•..."."..:„
Reports received in response to requests for investigations abroad
..Reports received of original investigations .by. Treasury attaches, and price lists received from
American consuls
.
...:
Differences in classification reported
:...
.1'.

13,323
2,284
2,453
1,582
1,847
5,584
474

104

REPORT OP THE SECRETARY OF THE TREASURY

The exchange issues weekly bulletins, one giving a memorandum of
various price lists and Treasury attaches' reports received, and the
other a list of requests forwarded for investigations abroad, so that
appraising officers interested in the same line of merchandise may
request copies of these reiports.
The supervising agent prepared memoranda for the Assistant
Attorney General during the past year in cases where it appeared to
him desirable to call to the attention of that officer certain questions
of law and fact with regard to pending cases where documentary
evidence was collected by the exchange.
Summary.—The following statement shows the results achieved
through the activities of the Investigative Unit during the year insofar
as direct results have a monetary measure or can be measured by a
count of individual cases:
Number
254
1,662
1,069
1,164
701
93
233
211
1,783
1,769
243
Amount
$1,287, 273
24,091
901,867
245,218
130,965
120,948
731,460
105,435

Ports examined
Drawback investigations
Foreign investigations conducted by members ofthe domestic service
Arrests
'
Convictions
Acquittals
Failures to indict
Indictment cases pending
Seizures-made
•.
Seizures appraised
Seizures released or pending..
Appraised value of seized merchandise.
Merchandise entered free but found dutiable
Fines, penalties, and forfeitures incurred, exclusive of court
Bail forfeitures...
Fines imposed by United States courts
Increased and additional duties collected
Deposits as offers in compromise
Proceeds of sale of seized-merchandise

fines

The actual recoveries and penalties covered into the Treasury as a
result of either direct or indirect activities of the Customs Agency
Service during the fiscal year, aggregated $2,259,984, representing an
increase of over $301,757 over the previous yea!r.
BUREAU OF ENGRAVING AND PRINTING

Deliveries of currency, securities, stamps, and miscellaneous work
by the Bureau during the year amounted to 366,380,624 sheets, as
compared with 315,905,581 sheets for the previous year, an increase
of 50,475,043 sheets. A comparative statement of deliveries of
finished work follows:
Deliveries of finished work in the fiscal years 1934 and 1935
Sheets
Face value.
1935

Currency:
U n i t e d States notes
Silver certificates
Gold certificates
N a t i o n a l b a n k currency
F e d e r a l Reserve n o t e s . . . ^ . . .
F e d e r a l Reserve b a n k notes (national currency)
Total..
B o n d s , notes, certificates, a n d bills:
Pre-war bonds .
Liberty bonds
Treasury bonds

1934

1936

4,600.001
39. 273,000
20,000
4, 527,120
3, 916,600

950,000
44, 467,000
3,500
1,909,959
7, 644,150

$22,800,000
943, 644,000
4, 200,000.000
190, 634,040
1,020, 300,000

54,974, 609

6, 377,378,040

. 2,224,000
54,460, 721
60,900^
140, 484
2.298,333^i

57; 860
141,838}^
1.988.162

359,777,000
1.117.951, 200
8,443,664,900

EEPORT OF THE SECRETARY OF THE TREASURY

105

Deliveries of finished work in the flscal years 1934 and 1935—Continued
Sheets
F a c e value,
1935
1934
B o n d s , notes, certficates, a n d bills—Contd.
U n i t e d States Savings B o n d s .
.
T r e a s u r y notes
T r e a s u r y bills
"Certificates of i n d e b t e d n e s s
Insular bonds:
P h i l i p p i n e Islands
Puerto Rican
F a r m loan b o n d s
Consolidated farm loan b o n d s
Collateral t r u s t d e b e n t u r e s .
Federal F a r m M o r t g a g e Corporation b o n d s .
H o m e O w n e r s ' L o a n Corporation b o n d s . . .
Reconstruction F i n a n c e Corporation n o t e s .
C u b a n silver certificates including certificates for t h e Secretary of t h e T r e a s u r y of
t h e R e p u b l i c of C u b a
P h i l i p p i n e t r e a s u r y certificates
N'otes for t h e b a n k of t h e P h i l i p p i n e I s l a n d s
I n t e r i m receipts for b o n d s of H o m e O w n e r s '
L o a n Corporation
I n t e r i m certificates for P u e r t o R i c a n b o n d s .
I n t e r i m transfer certificates for postal savings b o n d s
.-.
Specimens:
Treasury bonds
.
U n i t e d States Savings B o n d s
T r e a s u r y notes
T r e a s u r y bills
Certificates o f i n d e b t e d n e s s
Insular bonds:
P h i l i p p i n e Islands
Puerto Rican
. ..
F a r m loan b o n d s . . .
Consolidated farm loan b o n d s
Collateral t r u s t d e b e n t u r e s
F e d e r a l F a r m M o r t g a g e Corporation
bonds
H o m e O w n e r s ' L o a n Corporation b o n d s .
R e c o n s t r u c t i o n F i n a n c e Corporation
notes
.
..
..
.- _
Total

339,625
19,934
69,125

2.920.000
506,4501^
14.110
750

$413,760,000
11,805, 587, 500
5,771,148,000
300,000,000

700
1.938
33,457
249. 636
21,440
2,118,310
2.956,300
29,850

. 10,810
1, 2621^
28,246
801,809
10,402
3,847,037
7,030,900
3,850

986,250
1,950,000
15,072,000
1,736,498,000
199, 510,000
2,627.475.000
7, 881,450,000
358,250,000

473,756
1,417, 500
129. 900

724, 500.
93, 600
100

1,000

3.000

1
i\^

6,000.000
8,105,000
2,495.000

%
2
6 .
4
16

10
16H
18

14
14 ^

23
10

14
9,159,23413,^0

Stamps:
x45,365
Customs
.Internal, re venue:
108.633,986179.^04
U n i t e d States
. .
Philippine I s l a n d s . .
189,425
P u e r t o Ricaih
423,200
Virgin Islands
.._'
525
D i s t r i c t of C o l u m b i a
22,440
Federal m i g r a t o r y bird h u n t i n g s t a m p s .
F o r experimental purposes
Specimens. U n i t e d S t a t e s . .
1273.4
• Postage s t a m p s :
113.628.878
UnitedStates
U n i t e d States, surcharged
"Canal
Zone".15,750
C a n a l Zone
. ..
20,664
P h i l i p p i n e Islands
.122,976
Specimens. U n i t e d States
442fioo
Proofs, U n i t e d S t a t e s . .
2
Postal savings s t a m p s
6.882
Total
,
223,209.2654375^100
Miscellaneous:
Checks
24,430,978
- Warrants..'....^
60.440
Commissions.-.
112,966
Certificates
3,907.372
T r a n s p o r t a t i o n requests
255.470
Circular letters
Liquor, p e r m its
., .i56,937Vi
., O t h e r miscel laneous
161,076^6
' B l a n k paper...'
Specimensi. 120
Total
„ 29,076. 359?;^
|
G r a n d total
315,905,5817^2 5 1

1935

19, 386, 783M
160, 500

40,948, 668,850
Subjects
4.670,000

127.956,4823^04
11,000
856,279
250
97,14614
30,887
12
2.09415%04

10.584 707 787
2, 200,000
60 891 800
25,000
19 429 250
3, 459,344
604
31,725

140. 642.8261^7

13,832,390,331

62,470
892.620
1736^5

4. 722.000
86 780 448
10.480

6,582
270,709,323127^700
15^713,659
49,000
27,080H
4,460,758
323,500
474.960
..

258. 512 •
2,381
60.
21, 309, 9081^
366,380,62442^^700

658,200
24,599,976,869
78.568.295
246,000
30,972
19 295 225
1.617, 500
474 960
6 321 503
398
105. 553,853

106

REPORT OF : THE ' SECEETAEY' OF THE ' TEEASUEY

There was expended during-the year, for salaries and expenses^
$8,760,831, as compared with $7,101,59,9 in 1934. These expendituresare exclusive of $288,025 and $311,221 for 1935 and 1934, respectively,,
the amounts impounded ;under the pr(3visions of sections 110 and 203^
of the Economy Act. The following statement shows the appropriations, reimbursements, aiid expenditures for the fiscal years 1934 and1935: . ;
. ;
Appropriations, reimbursements, and expenditures for the fiscal years 1934 cmd'
:
1935

Appropriated by! Congress, salaries and expenses i
Transfer from appropriation pay and allowances. Coast
Guard
'
•
. . ..
Appropriation for restoration of 5 percent salary reduction and to cover 40-hour week
'
Transfer from appropriation collecting the internal
revenue
•
Second Deficiency Appropriation Act'..
^
Reimbursements from other bureaus for work completed?
_
^
.'....•
..

-Total _

Expended, salaries and expenses ^
Unexpended balance (including, .impoundments and
compensation deductions)

Increase (+),
decrease (—)

1934

1935

$6,060.680,00

$4.668.060.00

-$492,620.00

406,000.00

+405,000.00

400, 000. 00
491.780.00

+400.000.00'
+491,780.00

29,827,00

-29.827.00

2,692,005.31. . 3.6.49,262.77

+957,247.46

7, 782, 612. 31

9. 614,092. 77

+1,731,686,46

7.101.598'66

8.760.830,88,

+1,659, 232, 32

680.913,76

763,261.89

+72,348.14-

1 Includes $3,997.50 and $10,994 for salaries of employees transferred to the Procurement Division and::
the Division of Disbursement ofthe Treasury Department, in the fiscal years 1934 and 1936, respectively.
- 2 An additional amount of .$6,916.79 was received from sale of by-products and useless property and wasdeposited to the credit of the Treasurer of the United States as miscellaneous receipts.
..s Includes $8,000 transferred to the Bureau of Standards for research work in each of the fiscal years 1934
and 1935. The sums Of $238,485.42 and $263,829.22 were transferred to the retirement fund.in;the fiscals
years 1934 and 1935. respectively.
•

' Spoilage of currency increased from 2.52 percent for 1934 to 3.33
percent for 1935.
;-^ :.^v
The following dies for new 'postage stamps were-engraved during.the year:
:
•: ; r
Issue
i .. •
Special delivery a i r mail
:
_.—:
Connecticut T e r c e n t e n a r y . .
'.
,
'-.
California-Pacific International Exposition,. -San Diego
National parks, series 1934
i
:__:

•.

Denomination
cents
16
3
3
2 to 10, inclusive-

An increase in the vcjlume of hew orders was sufScieiit to keepthe entire force of thej Bureau; pperating full time in the last 5months of the fiscal year. The.rotating furlough was elimihated
on February 1, 1935.
• •" ;
\
•
'• The greattest demand for work during the year occurred • in c(3nnection with the printing of .checks, bonds j revenue stamps, and silver certificates. , All orders received iwere urgent, and extra, shiftswere frequently established until suffiqient engraved stock was available.- ••i
•
' ' • •. ^ [
•'•-;• ;•,;: •.'.'.' ;..; ' v.
" _ •'
The largest bond orders came from the Federal F a r m Mortgage
Corporation and the. Home Owners' Loan Corporation, and aggregated, more than 10,000,0.00 ,'sheefe.. The m
and.
plates for the various denominations df United States Saving Bonds.

EEPOET OF THE- SECRETARY: OF

THE:

TEEASURY

107

required a large amount, of original engraving. I n addition, certificates of indebtedness. Treasury notes, and bonds were printed
in connection with the Treasury financing program.
r The printing of checks for the Emergency Relief Administration
necessitated extra shifts. Special sta^mps were prepared for bottled
.distilled spirits and, as a protection against their illegal use, a
number was overprinted on each stamp, requiring an increase in the
size of the stamps and necessitating the purchase of 500 numbering
machines. A design was approved and die engraved for the new
series of 1935 silver certificates.
The Bureau sponsored an exhibit of printing at the Century of
Progress Exposition in Chicago, and a similar exhibit at the California-Pacific International Exposition at San Diego.
COMMITTEE ON ENROLLMENT AND DISBARMENT - OF ATTORNEYS
AND AGENTS

On September 1, 1934, the Committee on Enrollment and Disbarment of Attorneys and Agents was reorganized and its number reduced to three. The first work of the reorganized committee was to
revise the regulations governing the enrollment and disbarment of
attorneys and other agents. The new regulations made the committee a purely administrative and judicial body and relieved it of its
former prosecuting functions. An attorney, not a member of the
committee, represents the Government before the committee; all
complaints must be filed with him, and it is his duty to institute
pro(ieedings looking to disciplinary action. The committee conducts
;the hearings, ascertains t h e . t r u t h or falsity of the charges, and
determines what kind of disciplinary action to recommend to the
Secretary.
The following statement summarizes the work of the committee
for the year 1935 ^
Numlier
2, 922
. 38

Applications for enrollment of attorneys and agents approved
Applications for enrollment of attorneys and agents disapproved
Complaints against enrolled persons:
Pending July 1, 1934
Piled during the year
.
:
Disposed of:
Dismissed
Disbarments—^
"Suspensions
'
^ :-..
Reprimands
stricken from the rolls—
•

...

_i.

,
_____'
.
^^. .

1. ^^—.i
:___
—

;

92
35

- . . • • •

, . ..Pending June 30, 1935
._„^
r-—^^
Charges ma:de, names stricken from the rolls—:
:
.—-.
Disbarment v a c a t e d — — — . i
: _.^__ __'__^__il ;i__

127

21
13
8
6
7
^ 5

'.--

'72
9
1

• Since the organization in 1921 of the Committee on Enrollment
and Disbarment, 39,163 applications for enrollment have been approved and .540 disapproved. One hundred and seventy-four practitioners have been disbarred from further practice bef ore the Treasury Department, 122 have been suspended from> practice for various
periods, and 162 have been reprimanded. I n 14 cases the order of
disbarment has been terminated and the practitioner;restored-to good
standing bef ore the Department.;

108

EEPORT OP T H E SECRETARY OF T H E TREASURY
BUREAU O F I N T E R N A L R E V E N U E

General
Internal revenue collections.—Collections from internal revenue and
agricultural adjustment taxes during the fiscal years 1934 and 1935
are shown in the following summary, classified according to the administrative organization responsible for the audit of returns. A
detailed statement of collections appears in table 7, page 341 of this
report.
Summary of internal revenue collections for the fiscal years 1984 and 1935
[On basis of reports of collections, see p. 294]

Sources

Income Tax Unit:
Corporation income t a x
I n d i v i d u a l income t a x
Excess-profits tax
D i v i d e n d tax
Total

1934

$397, 515, 851. 94
419, 509,487. 78
• 2,630,615.56
1 50, 229,122. 97

.
. . .

Total

Total .

. . .

$572,117,876. 28 +$174,602,024.34
+107, 603,018. 64
527,112, 506. 42
6, 560,482. 64
+ 3 , 929,867. 08
• 1 961,479. 73
- 4 9 , 267, 643. 24
+236, 867, 266.82

91, 508,121. 29
212, 111, 959. 23
459,178, 625. 46

+ 1 1 , 339, 777.16
+98,973, 595.13
+34,009, 728. 42

2 492, 626, 529. 28
526, 222, 358. 24

-60,487,397.21
+154, 799,472. 60'

1, 543, 012,417. 40

1, 781,647, 593. 50

+238, 635,176.10'

252,333, 373.97
6, 577,958. 65

395,913,845. 99
15,107,926. 36

+143, 580,472. 02
+ 8 , 529,967. 71

258,911,332.62

411, 021, 772. 35

+152,110,439. 7a

430, 366. 25

13,861. 26

- 4 1 6 , 504.9^

2,672,239,194.52

3, 299,435, 572.18

+627,196, 377. 66^

Miscellaneous collections (prohibition a n d o t h e r ) .
G r a n d total

Increase ( + ) or
decrease (—)

1,106, 752, 345. 07

869,885, 078. 25

Miscellaneous T a x U n i t :
80,168,344.13
C a p i t a l stock tax
113,138, 364.10
E s t a t e a n d gift t a x e s .
. .
425,168,897.04
Tobacco taxes
Sales taxes ( s t a m p a n d excise, admissions,
c o m m u n i c a t i o n s , checks, oleomargarine,
etc.)...
2 3 553,113,926.49
371,422,885. 64
Agricultural a d j u s t m e n t taxes . .

Alcohol T a x U n i t :
Alcohohc liquor taxes:
Deposited b y collectors of i n t e r n a l revenue
Deposited b y collectors of c u s t o m s

1935

1 Tax repealed on dividends declared subsequent to Dec. 31, 1933.
2 Includes collections from tax on transfers of silver bullion of $606.04 in 1934 and $1,149,390.48 in 1935.
3 Excludes delinquent taxes collected under repealed laws in the amount of $520.64, which is included in
miscellaneous collections.

Rejunds.—In the foregouig statement of collections no deductions
were made on account of refunds, which during the fiscal year 1935
were paid from the several appropriations as follows:
Refunding taxes illegally collected, 1934 and prior years
Refunding taxes illegally collected, 1935 and prior years
Total
Advanc'es to Agricultural Adjustment Administration (transfer to Internal Revenue for
refunds)
.
Grand total, all refunds (interest included)

$16,970,410.93
7,088,553.26
24,058,964.19
32,063,188,81
66,122,163.00

In addition to the above amount, there were certain repayments as
provided under specific appropriations for the redemption of stamps,
representing the return to the Government of stamps purchased by
the taxpayer in excess of his requirements. The stamps so redeemed
during the fiscal year, including interest, totaled $1,426,049.97.
Total refunds and redemptions of stamps, classified by appropriations,
are shown in the following table:

109

EEPOBT OP THE" SECBETABY OP T H E TBEASUEY

Number of claims, amount of refunds and repayments, and interest allowed on each
class of tax during the fiscal year 1985
A m o u n t refunded or ^
repaid i

Number
of claims

A p p r o p r i a t i o n a n d class of t a x

R e f u n d i n g taxes illegally collected for t h e fiscal year 1934
a n d prior years, a n d 1935 a n d prior years:
I n c o m e taxes
Miscellaneous internal r e v e n u e taxes:
Capitalstock..
Distilled spirits
.
E s t a t e a n d gift
Miscellaneous
Narcotics
Sales .
Silver
:._•
Tobacco
Total
Agricultural a d j u s t m e n t taxes
T o t a l refunds
R e p a y m e n t s (not refunds of taxes erroneously collected):
R e d e m p t i o n of s t a m p s :
Distilled spirits
Miscellaneous
Narcotics •
Silver.
Tobacco
Total
Tobacco A c t of J u n e 28, 1934

62, 663

$21,133,663. 23

$5, 511,960,19

2,015
2,125
996
150
90
1,344
2
7

210,8.00. 69
140, 492. 76
1,632,132. 02
156,852. 21
151. 96
784, 495. 42
V 324.31
51.59

18,687,64
19,182, 76
223, 625, 33
1, 002. 87
L66
182, 789, 23

69, 392
78, 044

24, 058, 964.19
32,063,188. 81

5,957, 249. 68
20, 585. 61

147, 436

56,122,153. 00

5,977,835. 29

2,551
4,377
64
53
1,334

133, 564. 46
207, 320. 40
209. 65
4, 445. 95
1,079,092. 99

197. 79
14, 307. 76

8,379
36

1, 424,633. 45
1,416. 52

14, 505. 65

1, 426,049. 97

8,415

Total repayments
G r a n d total refunds a n d r e p a y m e n t s

Interest
allowed

67,648,202,97

155,851

14, 605. 55
5,992,340,84

1 Including interest.

If the above refunds and repayments during the year were deducted
from the gross collections of $3,299,435,572.18, the net collections for
the fiscal year 1935 would be $3,241,887,369.21. The gross collections,
however, are used for comparative purposes in this report.
Additional assessments.—Additional assessments resulting from
ofiice audits and field investigations amounted to $332,105,910.44,
as shown in the following summary:
Additional assessments during the fiscal year 1935, by class of tax
Class of t a x

Amount

I n c o m e taxes
Miscellaneous.internal r e v e n u e taxes:
Estate
. .
.
Gift
V C a p i t a l stock
. . . .
Sales (excise)
Distilled spirits
Tobacco.-..
....
O t h e r miscellaneous

.
. .

Grand t o t a l . .

.
^

T o t a l miscellaneous internal r e v e n u e taxes
Agricultural a d j u s t m e n t taxes

1 $240,634, 483. 26
21, 219,891, 42
390, 362. 44
1,071,196. 25
6,152,649. 93
18, 787, 032.85
41, 678. 04
25,112, 483. 98
2 72, 775, 294. 91
3 18, 696,132. 27
332,105,910. 44

1 Includes $232,511,940.26 from the Income Tax Unit and $8,122,543 from the Accounts and Collections
Unit. The assessments of the Income Tax Unit include $53,472,371.77 made under the jeopardy provisions
of sec. 279 of the Revenue Act of 1926 and sec. 273 of the Revenue Acts of 1928, 1932, and 1934.
2 Includes $29,847,939.06 from the Miscellaneous Tax Unit, $24,140,323 from the Accounts and Collections Unit, and $18,787,032.85 from the Alcohol Tax Unit.
3 Includes $4,898,517.27 from the Processing Tax Division and $13,797,615 from the Accounts and Collections Unit.

EEPOET OF THE SECEETAEY OF THE TEEASUEY

Cost oj administration.—The amount expended and •obligated in
administering the internal revenue laws for the fiscal year 1935 was
$42,719,338. This does not include the amounts expended for refunding taxes Ulegally or erroneously collected and for redemption of
stamps, which are in.no sense administrative expenses. The amount
expended and obligated in administering the agricultural adjustment
tax laws for the fiscal year 1935 was $4j851,674. A summary comparison for the fiscal years 1934 and 1935 of the amounts obligated
under the various appropriations for administrative expenses, the
amounts of taxes collected, and the cost of collecting each $100 of
revenue is as follows:
Am.ounts expended," obligated, and collected, and the cost of collecting each $100 of
revenue, fiscal years 1934 and 1935
•

Cost, of collecting each
$100 of..
revenue •

Expended and obligated

•

Collected

Appropriation
1934

1935

1934

1935

1934

1935

Collecting the internal
revenue
1 $28,826, 225. 732$42,719,338.00 $2, 300,816, 308.88 $2, 773, 213,213. 94 $1.25 $1.54
Advances to Agricultural
Adjustment Administration (transfer to
internal revenue ad' ministration expenses). .2,544,178.39
3,746,502.00 . 371,422,885.64 •521,880,108.61 .•.•69 .72
Administration of Cotton
Act of 1934 (transfer tb
internal revenue administration expenses
1934-35)
1,110,874.86
89.26
991,556.00
Advances to Department
of Agriculture under
Tobacco Act of June
28, 1934 (transfer to
internal revenue administration expenses,
1934-35)
3, 231, 374. 77
3.61
113,616.00
Total..

31. 370, 404.12

47,571,012.00 2, 672, 239,194. 52 3, 299,435, 572.18

1.17

1.44

1 The amount expended by the Bureau of Industrial Alcohol in administering the liquor laws prior to
consolidation with the Bureau of Internal Revenue, May 10, 1934, is not included in this figure.
2 Includes approximately $10,700,000 for administrative expenses of the Alcohol Tax Unit; the first full
year after the consolidation of the Bureau of Industrial Alcohol with the Bureau of Internal Revenue, and
restoration of salary cost for thei entire Internal Revenue Service.

Income Tax Unit

The Income Tax Unit is charged with the duty of auditing and
closing all income tax returns except those filed on form 1040A
Returns filed on form 1040A (returns of individuals reporting income,
chiefly from salaries and wages, of less than $5,000) are audited iri the
collectors' offices under the supervision of the Accounts and Collections
Unit.

REPORT OF THE, SECRETARY OF T H E TREASURY

H I

Summary of work of the Income Tax Unit for the fiscal years 1934 and 1935
Number
1934
Returns on hand in Washington and in the field at beginning of year i
Returns received during year:
Reopened and amended
Original . .
•
Total

....

Total to be disposed of
Returns closed during year:2
Additional assessments except jeopardy:
Before final notice of deficiency
After final notice of deficiency;3
Agreement
..
Default

•>

Total
'
Jeopardy assessments (subject to appeal)
Certificates of overassessment
.
No change. ,...'
^^'....'.:.;i..'i"i
Total closed

•
-

Returns not closed during year:
On hand for audit in Washington and in the field at end of year
..
Awaiting action of taxpayer after mailing final notice of deficiency
Involved in appeals to Board on final 90-day notice of deficiency mailed
during year .
...
:
Total not closed

—

1936

325.734

363.670

87, 252
1.920,041

126,833
1,864.671

2,007,293

1,991. 604

2.333.027

2.355,174

84,026

120.809

4.339
7.255

3,048
7,405

96,620
1,600
34, 869
1.830.018

131,262
1.769
27.868
1,784, 428

1.962.097

1,945. 327

363.670
1.913

402.394
2,913

6.347

4,540

370.930

409,847

1 Does not include returns with respect to which final notices of deficiency (90-day lettets) were mailed
prior to the beginning of the year,
2 Excludes returns closed through decisions of Board of Tax Appeals,
3 Includes some returns with respect to which final notices of deficiency (90-day letters) were mailed
prior to the beginning of the year.

Additional revenue.—Additional revenue made available for collection (exclusive of jeopardy assessments) was $179,039,568.49 as compared with $194,030,746.36 the previous year. The field forces of
the Income Tax Unit secured agreements to the immediate assessment
and collection of $23,797,541.50, whUe $155,242,026.99 was assessed
after consideration in Washington.
The additional revenues are classified in the foUowing table to show
the additional tax, interest, and penalty, and also the procedure
uivolved in reaching a settlement with'the taxpayers.

16816—36-

112

REPORT OF T H E SECRETARY OF T H E TREASUEY

Additional revenue made available for collection during the fiscal' years 1934 and
1935, classified according to the tax, interest, and penalty, and the procedure
involved
1935

1934
Amount
Tax
Interest
Penalty
Rejected claims for a b a t e m e n t a n d credit
Total

-.-

. -.
-.

Percent

$161,483, 716.42
38,126, 719.46
2,284,213.67
2,136,096. 81

78.1
19.6
L2
Ll

$141, 870,869,40
33, 232, 014,07
3,049, 375. 29
887,309,73

79.2
18.6
L7
.6

194, 030, 746.36

100.0

179,039,668.49

100.0

18.897,448.21

9.8

23.797.641,60

13,4

41. 742, 943.06

2L8

66.846,866.58

37,6

38, 603,162.99
23, 420, 736. 50
69,330, 358. 80

20.1
12,2
36. l '

4.312,969.05
13,786.480.88
69.408,400. 75

2.4
7.7
39.0

178.162. ,258,76

100.0

P r o c e d u r e involved in s e t t l e m e n t :
M i m e o g r a p h 3552 i . . l
R e g u l a r procedure:
Agreements executed b y t a x p a y e r
w i t h o u t 90-day letters
Agreements executed b y t a x p a y e r s u b s e q u e n t to 90-day letters
-Appeals n o t filed w i t h i n 90-day periodAction of B o a r d of T a x A p p e a l s
TotaL...

Amount

Percent

191,894,649.55

100.0

1 The effect of Mimeograph 3552 is to shorten the interest period when the additional tax is agreed to by
the taxpayer and field force. The above figures cover assessments made during periods June 1, 1933. to
May 31,1934, and June 1,1934, to May 31,1936.

Additional taxes were also assessed under the jeopardy provisions
of the several revenue acts, as follows:
Additional taxes assessed under the jeopardy provisions, of revenue acts during the
fiscal years 1934 and 1935 ^
1934
U n d e r b a n k r u p t c y a n d dissolution p r o c e d u r e . 1 . . R e t u r n s believed to b e f r a u d u l e n t l y rendered
T o t a l assessed—
Interest Penalties
Grand t o t a l . . . .

.- -

.. ..

---

•.
-

1935

$26,223,640.96
13,425, 730. 81

$30,948,136. 24
7, 233,665.13

39,649,271, 77
8, 875,646. 89
4, 771,665.02

38,181, 701, 37
11, 325,177.44
3, 965,492, 96

63, 296.583.68

53, 472, 371,77

1 The amounts shown may or may not represent taxes upon which collectors can proceed to immediate
collection since the majority of jeopardy assessments are appealed to the Board of Tax Appeals,

Final notices oj deficiency (90-day letters).—During the year 14,529
final notices of deficiency (90-day letters) were maUed by the Income
Tax Unit, as compared with 13,003 for the previous fiscal year.
Petitions were filed with the Board of Tax Appeals involving 31
percent of the returns with respect to which 90-day letters had been
issued. This compares with 41 percent during the fiscal year 1934.
The following table shows the number of tax years involved in
petitions filed with the Board of Tax Appeals during the fiscal years
1932 to 1935, inclusive:

EEPQET

OP: T H E

SECBETABY

OP T H E

113

TEEASTJEY

Number of tax. years involved in. petitions filed with the Board of Tax A p p e a l s d u r i n g
the fiscal years 1932 to 1935, by tax years
T a x year
1917....
1918
1919
1920
1921
1922 .
1923
1924 .
1925
1926-

1932
18
28
28
86
29
82
66
108
161
246

. .
._
-

1934

1933

1935

24
21
18
37
58
33
60
76
95
128

9
35
32
64
37
35
37
62
65
113

Tax year
1927..
1928..
1929..
1930..
1931..
1932..
1933-.
1934..

11
2
16
20
39
62
47
92
98

Total.

1932

1933

1934

1936

849
1,493
6,107
269
4
1

175
298
1,827
3,576
236

172
223
589
1,632
2,023
156
2

143
169
. 282
442
1, 002
2,001
104
3

8,576

6, 598

4,540

Claims and overassessments.—The following table shows the number
of refund claims adjusted and the certificates of overassessment issued,
together with the amounts of overassessments involved, during t h e
fiscal years 1934 and 1935:
Refund claims adjusted a n d overassessments determined d u r i n g the fiscal years 1 9 3 4
a n d 1935
1934
Claims:
P e n d i n g a t beginning of year
Filed d u r i n g year
. . .
Received from other sources

. . . .
_..

Total to be adjusted..

-..
.

.
-..

66,569

59,790'
25, 052
11, 90O

35,837

36, 952

20, 732

22, 838

Certificates of overassessment issued w h e n n o claim h a d b e e n filed.
O v e r a s s e s s m e n t s settled b y :
Abatement
Credit..
Refund
. . .
Total
Interest
G r a n d total

'.
.. .

.
:

•

26,480

18, 779

Amount
$112,371,340. 67
19,123,080.94
29,056,285.26

Amount
$59,938, 289. 64
27, 226, 776. 32
15, 621, 703. 04

160, 550, 706.87
11, 764,027,39

• 102,786,768.00
6,511,960.19

172,304,734,26

108,'298, 728,1&

Number
20, 732
33, 844
5,214

25,641
10.196

T o t a l adjusted
P e n d i n g a t e n d of year

Number
22,434
34,135

Allowed i n full or i n p a r t
Rejected
...

1936

NOTE.—The amount involved in claims filed during the year was $99,952,466.13 as compared witli
$176,132,959.94'the preceding year. Of the claims adjusted during the year the amounts rejected totaled
$104,526,409.83 as compared with $113,340,642.61 the preceding year.

There were also allowed during the year 10,179 collectors' claims^
of.which 8,935 recommended abatements or credits and 1,244 recommended refunds. A collector's claim usually lists: a .nuinber of
items in favor of different taxpayers; those settled during the year
covered 17,333 items for abatement or credit,and.47,506 for refund.
Returns on /land.—A ..comparative table of returns for all tax years
on hand at the close of the past 4 years follows:

114

REPORT OP THE SECRETARY OP THE TREASURY

Returns on hand in the Income Tax Unit on June SO, 1982 to 1935, by tax years
T a x year
1917
1918
1919
1920
1921
1922
1923
1924
1^25
1926

.._

1934

1932

1933

150
207
251
275
261
307
373
517
677
1,101

293
248
267
240
239
246
315
536
1.028
1,266

1935 1

116
85
118
116
98
146
157
212
277
388

167
119
125
163
146
209
232
281
.352
436

1932

Taxyear

1933

1934

1935

1927...
1928
1929
1930
. .
1931
1932
1933
1934

3,713
2,939
634
4.380
2,632
1.033
5,236
10,496
3,246
9,929
209.921
4,298
1 22.142 208, 111
9.622
192,211 297,803
I 45,421

507
823
2,214
2,993
4, 662
13, 643
339,236
1 36,188

Total

254, 771 326,734 363.670

402,394

1 Figures are incomplete, since the preliminary work on the returns for the year just previous.to the end
of the fiscal year cannot be completed within the fiscal year.

Audit in Washington.—The following table presents an analysis of
the returns, original and reopened, pending in the several divisions
and sections of the Washington office:
Original and reopened returns under consideration in Washington, June SO, 1935,
hy tax years
Audit Review Division

Individual
returns

Corporation
returns

T a x year

B
o
1917
1918
1919
1920
1921
Total
1922
1923
1924
1925
1926
1927
1928
1929
1930
1931
1932

— .
1
2
2
2
3
59
189
618
. . . . 3,121

Total
1933
1934

Total

•a

"3
O

•a
1
3
6
4
5

208

49
44
63
71
81
91
127
364
622
721
1.547

7
8
11
18
30
30
51
84
112
200
306

1
4
23
116
960

Conference
Section

78
18
24
30
34
44
70
82
127
112
129
78

o
tf
2
4
3
5
2

20
14
14
16
16

2
2
4
11
21
19
27
66
132
208
545

•a

-3
-

62
41
28
61
36

......

Consoli. d a t e d returns

Special
Ada n d Valua- justtion D i v i - m e n t
sion
Section

2
1
3
6
6 .
7
11
62
142
349
867

748 1.466

2
4
9
7
16
21
33
60
56
82
68

2
3
8
13
14
31
40
59
90
256
639

368 1.165

3,897 3,660 1.105

857 1.037

5,074
278

517 2,514
173
29

137 1.136
64
17

29
1

106

596
17

6.362

546 2.687

154 1.200

106

613

G r a n d t o t a l . . 9.249 4.414 3.792 1.030 2.237

866 1.661

379 1.768

Toi al

-a

o
tf

I
o

7
4
10
11
10

19
19
27
37
40

142

7
13
. 18
14
20
19
34
97
158
143
147

71
94
88
108
114
91
207
475
571
674
978

6
6
16
32
43
60
82
250
576
1,447
6,132

164
187
209
252
306
322
534
1.197
1,631
1,949
3,124

670 3.471

101
85
88
123
. 108
505

8,650

9,764

433
21

9,425
532

1,203
68

454

9.957

1.271

794 4.067 18. 607 11, 640

Audit in the field.—There were 356,906 returns for aU years pending
for verification in the offices of the 38 field divisions of the Income
Tax Unit on June 30, 1935, compared with 310,566 returns on hand
June 30, 1934.

REPORT OP THE SECRETARY OP THE TREASUEY

115

Changes in tax liability were recommended by the field forces in
165,361 returns, or in 32 percent of the 520,958 returns disposed of by
the field forces during the year. In the case of 134,218 returns, or
81 percent of those changed, taxpayers, agreed with the conclusions of
revenue agents. The total additional tax recommended by revenue
agents during the fiscal year was $265,967,439.62, compared with
$203,510,465.96 ih the preceding fiscal year.
The Technical Staff
The Technical Staff, organized November 16, 1933, considers (a)
proposals for the settlement without further litigation of income,
profits, estate, and gift taxes asserted in deficiency notices maUed
under the various revenue acts and (b) questions involving determinations of Bureau policy, specific cases, and other matters assigned or
submitted to it by the Commissioner of Internal Revenue. In addition to its regular settlement work, the jurisdiction of the staff has been
enlarged to include certain classes of compromise of income tax cases
(excluding cases involving fraud or cases urider the supervision of a
court), applications for extension of time within which to pay income
taxes under sections 56 (c) and 272 (j) of the Revenue Act of 1932
and the corresponding provisions of prior revenue acts, and the
review in behalf of the Commissioner of Internal Revenue of final
closing agreements executed pursuant to section 606 of the Revenue
Act of 1928.
On July 1, 1934, the technical staff had on hand 3,770 docketed
cases pending before the Board of Tax Appeals. During the year
the staff received 3,347 Board dockets, considered to a conclusion
3,058 Board cases, and settled 1,616 cases. The deficiencies proposed
on cases recommended for settlement by the staff totaled $39,781,473.88; the recomputed deficiencies (without eliminating the enforced
credits in estate tax cases) were $21,287,302.03., making a settlement
effectiveness of 54 percent. The settled docketed cases involving only
income taxes showed the same settlement ratio with respect to the
deficiency asserted in the statutory notice. During the fiscal year
the staff considered 1,379 so-called '^90-day status cases" of which
970 were disposed of without petitions being filed with the United
States Board of Tax Appeals. These cases involved proposed deficiencies of $2,288,791.15 and recomputed deficiencies (not reduced by
enforced credits in estate tax cases) of $1,217,869.73, or a settlement
effectiveness of 53 percent.
On July 1, 1934, the staff had on harid 1,251 compromise cases;
1,500 cases were received duruig the year and 2,064 cases were disposed
of, leaving a balance of 687 cases on June 30, 1935.
There were 448 extension-of-time cases turned over to the staff on
February 26, 1935; between that time and June 30, 1935, 296 cases
were received and 560 disposed of, leaving 184 cases on hand June
30, 1935.
In addition 462 final closing agreements submitted pursuant to
section 606 of the Revenue Act of 1928 were reviewed by the staff in
behalf of the Commissioner of Internal Revenue.
Miscellaneous Tax Unit
The Miscellaneous Tax Unit administers all taxes other than the
income and excess-profits taxes and the taxes applicable to alcoholic

116

EEPOET OP THE SECEETAEY OF THE TEEASUEY

beverages. The unit consists of six divisions, the titles of which are
indicative of the general type of taxes administered. Certain taxes,
such as the tobacco taxes, occupational taxes, stamp taxes, certain
excise taxes, estate taxes, etc., have been collected for many years.
Others, such as the processing and.related taxes imposed under the
Agricultural Adjustment Act and similar legislation, the tax on
transfers of interests in silver bullion, taxes on the refining and production of crude petroleum, certain new excise taxes, and a more involved capital stock tax, have resulted from recent legislation and
have operated to increase greatly the volume of work in the Miscellaneous Tax Unit, with a consequent necessity for an increase in the
personnel.
The total collections of miscellaneous taxes for the current fiscal
year amounted to $1,781,647,593.50, an increase of $238,635,176.10
over the prior year.
Estate Tax Division.—Estate tax collections for the year amounted
to $140,440,682.34, an increase of $36,455,394.30 over the preceding
year. Gift tax collections amounted to $71,671,276.89, and exceeded
collections for the previous year by $62,518,200.83. Transfers of
property by gift during the year were valued at $505,844,720, as compared with $101,792,574 in the previous year. In addition to the
estate and gift taxes actually collected, deficiencies in the amount of
$21,742,842 were asserted in 242 cases upon which collection was
withheld pending a review of appeals filed with the United States
Board of Tax Appeals.
As a result of the audit of estate tax returns by the Bureau at
Washington, deficiencies in tax amounting to $19,209,108.70 were
assessed in 55.4 percent of the cases closed, as compared with $13,185,549.91 assessed in 52.5. percent of the cases closed in the prior year.
Deficiencies in the gift tax were assessed in the amount of $345,383.51
in 2.4 percent of the cases closed, as compared with $138,097.51
assessed in 2.3 percent of the cases closed for the previous year.
The administrative work in connection with estate and gift tax
returns is summarized in the following table:
Number of estate tax and gift tax returns investigated and audited during ihe fiscal
years 1934 and 1935
Gift tax

E s t a t e tax
1934
R e t u r n s in field:
O n h a n d at beginning of year
Received for investigation
T o t a l to b e disposed of
M a j o r reports s u b m i t t e d b y field force
On h a n d at end of year

R e t u r n s in B u r e a u :
O n h a n d a t beginning of year .
Received
Reopened
T o t a l to be disposed of
Disposed of
O n h a n d at e n d of year

. .

.. .

1935

1934

1935

1,967
10,410

3,449
11,137

1,068
1,045

673
2,152

12,377
8,928

14, 586
10,951

2,113
1,440

2,825
1,923

3, 449

3,635

673

902

4,587
11, 210
867

6,488
13,133
177

1,706
3,619

3,291
11,410
18

16, 664
10.176

19,798
10,105

5,325
2,034

14, 719
11, 789

6,488

9,693

3,291

2,930

117

EEPOBT OP THE SECBETABY OP THE TBEASUBY

Number of estate tax and gift tax returns investigated and audited during the
fiscal years 1934 and 1935—Continued
Gift tax

Estate tax
1934
Protest letters of taxpayers as a result of tax determined by
audit:
On hand at beginning of year
Received
Total to be disposed of
-.Disposed of by Estate Tax Division
On hand at end of year

1935

98
864

236
1,374

16
107

962
726

1,610
1,124

25
9

123
41

236

486

288
132

3
1
4
4

•

Final agreements (sec. 606 of the Revenue Act of 1928):
On hand at beginning of year
Cases received for agreements

420
417

Total to be disposed of
Closed..
On hand at end of year

1934

1935

1243

Oases adjudicated by the Board of Tax Appeals

1147

1 Included in returns disposed of, above.

Refunds of estate and gift taxes allowed, with interest, totaled
$1,632,132,02. Tax in the amount of $265,346.79, includmg interest
of $71,538.22, was refunded as a result of judgment claims filed in
20 cases. The following table shows the estate and gift tax claims
for refund and abatement on hand at the beginning of the year and
the claims received and disposed of during the year:
Estate tax and gift tax claims on hand, received, and disposed of during the fiscal
year 1935
Estate tax claims
Refund
Number
Claims filed:
On hand July 1,1934.
Received
.
Reopened .
Total to be disposed of
Allowed
Rejected

Amount

Gift tax claims

Abatement
Number •'

Amount

Refund

Number

Amount

Abatement
Num- Amount
ber

156 $3,181,607. 64
689 1,381,018.14
13
57,524. 33

5
$1,973. 28
213 8,000,878.29

9
$7,724. 61
29 3, 573, 565. 47

2 $6,639.15

758 4,620,050.01

218 8,002,851. 57

38 3,581,290.08

2 6,639,15

>
• 476 1,013, 266. 43
93 1, 597,021.98

209 7,992, 257. 40
2
1,173. 66

17
2

4,141. 64
11,129. 23

2 6,639,15

569 2,610,288.41

211 7,993,430. 96

15, 270.87

2 6,639.15

Total disposed of.
On hand June 30,
1935
No claims filed, overassessments allowed..
Interest allowed . . . .
Total allowed including interest-

189 2,009,761. 60
413

9, 420. 61

19 3, 666,019, 21

365, 240.16
222, 390. 25

185 10.296,340.96

25,858, 46
1,235.08

11 46,393,90

889 1,600,896.84

394 18, 288,598. 36

107

31, 236.18

13 53,033.05

NOTE.—In addition to the above, $169,074.98 was abated as uncollectible in 27 estate tax cases, and $3,836.29
was abated as uncollectible in 2 gift tax cases.

118

REPORT OP THE SECRETARY OP THE TREASURY

Tobacco Division.-^CoMeetion^ of tobacco taxes for the year
amounted to $459,178, 625.46, which represents the largest annual
collection from this source since these taxes were first imposed. The
collections show an increase of $34,009,728.42, or approximately 8
percent over the previous year, and $8,839,564.96 more than the
previous high collections in 1930. The sum of $385,459,570.66, or
84 percent of the total tobacco taxes received, was collected on small
cigarettes, which represents a new high in collections from this source;
but collections on large cigarettes and small cigars declined.
A detailed comparison of the tobacco taxes collected during the
last 2 fiscal years follows:
Tobacco taxes collected during the fiscal years 1934 and 1935
Increase (+) or decrease
1934

Source

1936
Amount

Cigars (large):
Class A.Class B
Class C
Class D
Class E

:.-.

Total

. .

Cigars (small)
Cigarettes (large)
Cigarettes (small)
Tobacco, manufactured
Snuff
. ..
Total
Leaf tobacco sold
Cigarette papers
Cigarette tubes
Grand total

$8,485,474.10
200, 030, 28
2, 546,256. 63
406,023,39
55.074.74

11,633,296,26

11.692,859.14

+$384,110,00
+82,248,81
-342, 024.92
-63,392.48
- 1 1 , 378. 53
+59,562,88

143,738.75
-29, 279. 38
173,018.13
-620.178,99
637.496, 66
17, 317, 56
349, 661,945,46 385,469, 570. 66 +35, 797, 626, 21

.
. .

$8,101,364,10
117,781,47
2,888, 281. 56
469,415,87
66,453, 27

. .
.

Percent

+4,74
+69,83
-11.84
—11,62
-17.12
+.61
-16.92
-97, 28
+10. 24

65.298,629,34
6,788.191,13

64,372,414. 27
6,511,662,53

-926, 216, 07
-276, 528.60

62,086,820.47

60,884, 076,80

- 1 , 202,743. 67

-1.94

4,994.39
963, 768.16
12, 310.00

+ 1 , 728. 39
+6, 063. 58
-3,049. 60

+52.92
+,63
-19.85

425,168,897, 04 469,178,625.46 +34, 009, 728,42

+8.00

3, 266, 00
967,694. 68
15, 359. 60

—1,67
—4.07

Silver Tax Division.—The Silver Tax Division was organized in
July. 1934, for the purpose of administering the. tax imposed under
the SUver Purchase Act of 1934, approved June 19, 1934. Collections
of silver tax for the year amounted to $1,149,390.48; and adjustments
by way of refunds and redemptions amounted to $4,770.26.
Sales Tax Division.—The yield from the taxes administered by the
Sales Tax Division was $491,477,138.80, a decrease of $61,636,702.29
from the previous year. This decrease is due mainly to a reduction
in the rate of tax apphcabie to gasohne from IK cents to 1 cent a
gallon, effective January 1, 1934; the repeal of the tax on checks as of
January 1, 1935, and of taxes on candy, soft drinks, and boats; the
reduction in the rate of tax on sales of produce for future delivery;
and the elimination of the tax on articles made of fur selling for less
than $75 and on articles of jewelry selling for less than $25.
There was no legislation enacted during the current year which
repealed or modified any of the taxes administered by the Sales
Tax Division. The manufacturers' excise taxes and other taxes
imposed under the Revenue Act of 1932, as amended, which would

REPORT OP THE SECRETARY OF THE TREASURY

119

have terminated at the end of this year, were continued in effect untU
June 30 or July 31, 1937, by Public Resolution No. 36, approved
June 28, 1935.
A comparison of the various taxes coUected during the last 2 fiscal
years is shown in the following table:
Collections of taxes administered by ihe Sales Tax Division during the fiscal years
1934 and 1935
1934

Source
Documentary stamps:
Bonds of indebtedness, capital stock issues, e t c . .
Capital stock sales or transfers
Sales of produce (future delivery)
Playing cards
Total
Oleomargarine:
Colored
Uncolored
ST)ecial taxes
Total

$16, 259, 304.76
38,065,999,47
7,847, 743. 08
4,406,384.68

^
. .

i . .

Adulterated butter...
Renovated butter
. .
Mixed flour
Filled cheese .

. .
.

_ .-

Total
Manufacturers' excise taxes.
Transportation of oil by pipe line
Electrical energy
Telegraph, telephone, cable, and radio messages,
etc
.Leased wires, etc., (telegraph and telephone)
Safe deposit boxes
Checks
.Total
Admissions-.
Dues and initiation fees

Total
Pistols and revolvers
Narcotics
..
Delinquent under repealed laws

44,871, 60
603,398.26 ,
827,960, 57

84,800.77
898,121.82
1,066,053.91

+39,929.27
+294, 723. 57
+238,093,34

1,476, 230. 32

2,048,976.50

+672,746.18

1,462.47
9,690, 03
3,830, 50
1,59

3,992. 55
4,928,34
4,525.93
1,003.58

+2, 530.08
—4, 761,69
+695.43
+1, 001.99

14, 984. 59

14,450.40

—634.19

356,850, 659. 07 '
10,379.369. 69
33,134,407,26

309,255, 051.59
9, 479, 721.47
32.577,256, 30

—47, 595, 507.48
-899,648.12
—657,150.96

18,094,685.26
1,156,114. 59
2, 715,850. 67
41,383,198.66

18,411,925, 22
+317,239.96
1, 329, 508, 88
+173,394. 29
2,317, 619. 30
-398, 231. 37
—15,738,059.96
25, 645,138,70

463, 714,185.10

399,016,221.46

—64, 697,963. 64

14,613,414.42
5,986,150.46

15,379.397,16
5,784,494. 99

+765, 982. 74
-201,655.47

20,599,564.88

21,163,892,15

+564,327.27

62,980.41
495, 270.18
181.193.62

60, 237,83
580,613,00
383,868,24

+7,257.42
+85,342.82
+202, 674.62

1,024,719.07

+295,274.86

24,467, 091.25 +24, 457,091, 25
1, 759, 789. 67 +1.759.789,67
8,016. 33
+8, 016.33

Total
Grand total.

$17,934,776.98 +$1, 675,472. 22
15,747,362. 69 —22,318,636.88
3,950, 544. 00 -3,897,199.08
4, 351, 299.40
-55,085.28
—24,695,449.02

729,444. 21

Total
Coconut, etc, oils processed
Crude petroleum processed, refined, etc .
National Firearms Act

Increase (+) or
decrease ( - )

41,983,982.97

66,679,431.99

. .

1935

26,224,896, 25 +26,224,896.26
..

1 553.113,841. 09

491,477.138.80

—61,636, 702. 29

1 The collections of capital stock tax, which were included in a similar table in the annual report for 1934
are now shown in the statement of the Capital Stock Tax Division.

The claims for refund and abatement of taxes and redemption of
stamps, received and, adjusted in the Sales Tax Division during 1934
and 1935 are shown in the following table:

120

EEPOET OF THE SECEETAEY OP THE TEEASUEY

Claims for refund and abatement received and disposed of during the fiscal years 1934
and 1935 .
.1934

On hand at beginning of year.
Received or reopened..

1935

Number
8.881
29,531

Number
7,117
13,713

38.412

20,830
1.500

Total
Transferred to Capital Stock Tax Division, January 1, 1935
Transferred to Bureau of Industrial Alcohol, December 13, 1933..

"3.'i73'

Total to be disposed of
Adjusted

19,330
14,034

36, 239
28.122

On hand at end of yearClaims allowed

7.117

6,296

Amount
$4.402.950. 36

Amount
$3.479.098.19

There were 8,269 sales tax credit cases totaling $3,139,846.29 on
hand at the beginning of the year; 11,763 cases amounting to $4,990,122.03 were received; 15,519 cases amounting to $6,259,598.66 were
disposed of, leaving on hand at the end of the year 4,513 sales tax
credit cases amounting to $1,870,369.66.
A total of $737,974,518.22, representing 1,131,858 items, was
approved by the Commissioner on miscellaneous assessment lists.
There was included in these lists $29,847,939.06 representing 32,454
additional assessments resulting from office audit and field investigation. The interest paid and assessed on the miscellaneous tax lists
amounted to $4,174,607.53. The miscellaneous lists do not include
the processing and related taxes, the taxes on the transfers of interest
in silver bullion, or the taxes collected on the sale of stamps.
During the year there were received and examined 607,720 returns
filed by taxpayers in connection with taxes administered by the Sales
Tax Division.
The number of offers in compromise submitted in settlement of
liabilities incurred in connection with sales, tobacco, estate, gift,
narcotics, capital stock, and miscellaneous stamp and special taxes,
and the aggregate amounts thereof received and disposed of are
shown in the following table:
Offers in compromise received and disposed of during the fiscal years 1934 and 1935
1934
Number
On hand at beginning of year .
Received during year
Total to be disposed of
Accepted.
.
Rejected
Withdrawn
Transferred to Bureau of Industrial Alcohol i.
Total disposed of
On hand at end of year

Amount

1936
Number

Amount

9,898
26.168

$391.287.95
627.182. 48

4,866
9,489

$465.170. 90
474.817. 67

36.066

1.018.470.43

14,354

939,988.67

23.242
926
6
6.027

389.894.83
83.418. 71
235, 00
79.760,99

6.990
1.618
9

116.890. 43
182,870. 49
446. 00

30.201

663.299.63

8.617

299.206.92

4.865

465.170.90

5.837

640,782,65

1 The duties and functions of the Miscellaneous Tax Unit relating toalcoholic liquor offers in compromise
were transferred to the Bureau of Industrial Alcohol on December 13,1933.

121

EEPORT OF THE SECRETARY OF THE TEEASUEY

Processing Tax Division.—A total of $526,222,358.24 was collected
during the year from taxes administered by this Division, of which
amount $521,880,108.61 represented processing, compensating, and
fioor stock taxes imposed under the Agricultural Adjustment Act,
as amended; $1,110,874.86 represented taxes imposed under the provisions of the Cotton Act, approved AprU 21, 1934; and $3,231,374.77,
taxes imposed under the provisions of the Tobacco Act, approved
June 28, 1934. Collections of taxes administered by the Processing
Tax Division are summarized as follows:
Collections of processing and related taxes during the fiscal years 1934 and 1935, hy
commodities
Commodity and tax
Wheat:
Processing
Compensating
Floor (wholesale)Floor, (retail)
Total.
Cotton:
Processing
Compensating
Floor (wholesale).
Floor (retail)
Total.
Tobacco:
Processing
Compensating
Floor (wholesale).
Floor (retaO)
Total.
Field corn:
Processing
Compensating
Floor (wholesale).
Floor (retail)
Total.
Hogs:
Processing
Compensating
Floor (wholesale).
Floor (retail)
Total.
Paper and jute:
Processing
Compensating
Floor (wholesale).
Floor (retail)
Total.
Sugarcane and sugar beets:
Processing
Compensating
Floor (wholesale)
Floor (retail)
Total.

1934

1936

$104.038.634,96
20.774. 76
10.941.402. 43
2, 620,362. 68

$123.564,486. 69
27, 744. 27
249.622. 94
19.078. 43

117,621,174.82

123.860,932. 23

86,713,369. 62
1, 086,773. 45
46, 375,040. 40
11, 592,059. 27

93.253,443.98
1. 799,354. 68
771,125. 07
102, 377. 98

144,767, 232. 64

95,926.301. 71

16.873,985.81
155,209.07
1.814,629. 01
244,602.16

32.161.943. 21
236.479. 52
311.083.18
15,995. 53

18.088.426.05

32.726,501, 44

3.413,305. 32
18,450. 05
982, 676. 73
81, 761. 64

6, 760,471, 65
48,663, 08
38,843, 65
1, 651.49

4.496.193, 74

6,849,629.87

70. 716.192,12
33, 289. 21
6,166,969. 51
118,160. 40

184,380,029. 76
186, 591. 68
32, 766. 28
1, 621. 74

77.034, 611. 24

184, 601, 009. 46

6,261,648.11
916,342. 01
3,006, 960. 26
69, 880. 40

2.855, 500. 01
131, 697,10
222, 996. 64
11, 513. 62

9,244,830. 78

3,221, 707. 27

140,020. 78
30.395. 69

65,599, 571. 49
3,809, 586. 71
11,314,081. 06
370, 731. 40

170. 416. 37

71,093, 970. 65

Peanuts:
Processing
Compensating.

3, 669,623. 39
2,412. 62

TotaL.

3,571,936.01

122

EEPORT OP THE SECRETARY OP THE TREASURY

Collections of processing and related taxes during the fiscal years 1984 aiid 1935, hy
commodities—Continued
1934

Commodity and tax

1935

Rice:
Processing
Compensating

$1,582,65
27.537.42
29.119,97

Total

1,110,874,86
3,231,374. 77

Cotton ginning
Tobacco sales
Grand total

$371,422,885. 64

526. 222.358.24

Return^ ffied during the year under the provisions of the Agricultural Adjustment Act, as amended, the Cotton Act, and the Tobacco
Act are shown in the following table:
Number of returns filed during the fiscal year 1935, by commodities

Agricultural Adjustment Act:
Wheat.
.Cotton.
Field corn . .
Hogs
Tobacco
. .
Paper and jute
Sugarcane and sugar beets
Peanuts
Rice
Total
Cotton Ginning Act
Tobacco Act.

Processing
tax

Import
compensating tax

Floor tax
(wholesale)

63.121
14,104
114,335
182, 945
67, 991
2,675
6,788
563
134

4,055
31,174
3,446
1,673
1,635
2,050
6.513
169
163

3,273
3,376
1.006
1.097
65.920
2,299
60,493

3,914
12,092
4,020
4,484
7,640
4,563
95, 649

64,363
60,746
122,867
190,199
143,186
11,687
168, 443
732
297

441, 656

60,878

137, 624

132,362

762,420
70,065
3 613

Floor tax
(retail)

Total

A summarization of the number and amount of all claims for refund, credit, and abatement received and adjusted in the Division
during the fiscal year foUows:
Claims for refund, credit, dnd abatement received and disposed of during the fiscal
year 1935
Number

Amount

Agricultural Adjustment Act, as amended:
Export refunds:
On hand July 1, 1934
16.682
$6,164, 504, 44
Received
64.325
20,232,661.22
Reopened
1,230
69,189.90
Allowed
61,425
23,431,363. 50
Rejected
2,016
1,433,671.82
On hand June 30, 1936
7.697
1,691,320. 24
Charitable and other refunds:
On hand July 1. 1934
9,078
2,861, 626. 52
Received
_.
41.071
J 116,040, 666.89
Reopened
276
39,037.96
Allowed
34, 628
12,963,546.82
Rejected
29, 551,395.11
6,078
On hand June 30, 1935
10.819
75,416,289.44
Credit:
On hand July 1, 1934
1,417
1,083,949.10
Received
11,448
6,686,662.77
Reopened
0
0
2.273.233.09
Allowed
6.422
813,301. 23
Rejected
830
4.684.067.56
On hand June 30,1936
_
5.613
1 Includes claims approximating $70,461,000, based on the alleged unconstitutionality of the Agricultural
Adjustment Act and related legislation.'

123

BEPORT OF THE SECRETARY OF THE TBEASUBY

Claims for refund, credit, and abatement received and disposed of during the fiscal
year 1935—Continued
Number
Agricultural Adjustment Act, as amended—Continued
Abatement:
On hand July 1,1934
Received
Reopened
Allowed
Rejected
On hand June 30,1935
• Uncollectible:
On hand July 1,1934
Received
Reopened
_
Allowed
Rejected-.
On hand June 30,1935
Tobacco Act:
On hand July 1,1934
Received.
ReopenedAllowed
Rejected..
On hand June 30,1935
Cotton Ginning Act:
On hand July 1, 1934—
Received
Reopened
Allowed
'..
Rejected..
On hand June 30,1936
Total claims:
On hand July 1,1934
Received
Reopened
Allowed
Rejected...
-....
On hand June 30,1935

Amount

1,891
3,030
28
3,302
469
1,178

$12,057,850.15
4,620. 572.67
17,376.85
9,987,687.37
2,496,009.72
4,113,102.68

66
1,864
1
1,728
14
189

2,381.67
183,464,34
18,32
76,660. 77
5,635. 50
103,567.96

0
9,140
0
50
1,262
7,828

0
597,987.98
0
6,062.10
165,504. 98
427,430.90

0
101
0
0
0
101
28,034
120,979
1,535
107,465
9,668
33,425

0
64,246.85
0
0
0
64,246.85
22,160,211. 78
147,326,262. 72
115. 623. 03
48,737,543. 65
34,464,618.36
86,400,025,52

The number of offers in compromise considered during the year
was 534 involving a total amount of $91,828.96.
Assessment of 697,992 items representing a tax liabUity of $588,218,914.52 was made during the year on the processing tax hsts.
This amount includes 5,652 additional assessments totaling $4,898,517.27 as a result of office audit or field investigation.
Capital Stock Tax Division.'—Collections of capital stock tax during
the year amounted to $91,508,121.29, an incjrease of $11,339,777.16,
or approximately 14 percent over the preceding year.
As the result of the audit of capital stock tax returns 5,673 assessments involving $894,806.71 were made.
The claims for refund and abatement of capital stock taxes, penalties, and interest received and adjusted in the Capital Stock Tax
Division are shown in the following table..

124

REPORT" OF THE - SECRETARY OF THE TEEASUEY

Claims for-refund and abatement received and disposed of during the fiscal years 1934
and 1985
1934

Claims

Total . .
Adjusted..

On hand at end of year
Allowed-.

6
.2,613

Number
1,500
3,800

2,618
1,118

6,300
4.410

Number

On hand at beginning of year
Received or reopened

..
-'.

1935

1,500

890

Amount
$124.463,86

Amount
$390,348,43

Alcohol Tax Unit
On June 30, 1935, the following legitimate producers and distributors of alcohol and alcoholic beverages, and users of tax-free alcohol,
were under the supervision of the Alcohol Tax Unit: 36 alcohol distilleries; 89 whisky, rum, and gin distilleries; 137 brandy distUleries;
70,!alcohol warehouses; 137 wliisky, rum, gin, and brandy warehouses;
1,107 wineries; 88 bonded wine storerooms; 702 breweries; 383 rectifying plants; 4,510 wholesale liquor dealers; 40 denaturing plants;
68 bonded dealers in specially denatured alcohol; 4,155 bonded manufacturers using specially denatured alcohol; and 5,966 hospitals,
laboratories, and educational institutions using tax-free alcohol.
Enjorcement Division:—The Enforcement Division is responsible
for the investigation, detection, and prevention of willful and fraudulent violations of the internal revenue laws relating to distilled
spirits, wines, and fermented malt liquors. The Division plans and
coordinates the enforcement functions of the 15 administrative districts, supervises the activities of the investigators, and provides for
their general instruction.
During the year 15,712 stills having an aggregate mash capacity of
2,853,739 gallons were seized, and in connection therewith 21,373,107
gallons of mash were found and destroyed. Investigators also seized
863,375 gallons of spirits and 4,837 automobUes and trucks. The
total appraised value of property seized amounted to $5,632,145.
A total of 31,625 persons were arrested for Federal hquor law violations, but, in the case of 2,104 persons, the arrests were made by
State and local officers on information furnished by investigators of
the Alcohol Tax Unit. During the year, 25,408 cases were reported
to United States attorneys.
During the year, 283 applications for pardon, and 3,377 applications for parole were received; and 282 applications for pardon and
2,841 applications for parole were examined and reports submitted.
Audit Division.'—There were on hand at the beginning of the year
5,728 claims for refund, redemption, abatement, and uncollectible
claims, aggregating $1,202,406.35. During the year 20,587 claims
were received, in the amount of $7,695,095.31. Of the claims to be
disposed of, 19,064 were allowed and 1,943 were rejected, in the
aggregate amount of $5,405,245.47, leaving on hand at the end of the
year 5,308 claims, aggregating $3,492,256.19, classified as follows:
442 refund claims amounting to $707,076.97; 420 redemption claims.

REPORT OP THE SECRETARY OP THE TREASUEY

125

$4,394.94; 1,243 abatement claims, $1,121,084.30; and 3,203.uncollectible claims, $1,659,699.98.
At the beginning of the year 14,99^1 offers in compromise, aggregating $176,578.69, were on hand; and during the year, 45,362 offers
were received, the total amouriting to $600,682.54. Of the foregoing,
49,809 offers, amounting to $387,962.38, were accepted; 1,013,
amounting to $60,628.20, were rejected; and 82, amounting to
$9,597.25, were withdrawn; leaving 9,449 offers^ aggregating $319,073.40, at the end of the year;
The audit of floor tax returns required by the Liquor Taxing Act
of 1934 was coiripleted during the year. There were 75,804 returns
filed, reporting fioor taxes aggregating $8,699,139.17.
The Tax Section certified to the Commissioner 1,304 assessment
lists, which carried 24,673 items, totaling $18,787,032.65, listed by
the Section, and 213,357 items, aggregating $19,283,749.68, listed by
collectors.
Laboratory Division.—The Laboratory Division comprises a chemical laboratory in Washington, D. C , and 14 branch laboratories
located throughout the country. These laboratories perform all the
chemical work for the Bureau of Internal Revenue and Bureau of
Narcotics, as well as work for the Federal Alcohol Control Administration and Bureau of Customs.
A new distillery procedure was initiated which transferred the
major portion of the manual labor previously performed by Government officers to distillery employees. This procedure made it possible
to release 133 storekeeper-gagers from distillery supervision for
assignment to the Retail Liquor Dealer Section.
Accounts and Collections Unit
The Accounts and Collections Unit, which is the central administrative organization for the 64 collection districts, is divided into 3
divisions: The Collection Accounting Division; the Collectors' Personnel, Equipment, and Space Division; and the Disbursement
Accounting Division.
Collection Accounting Division.—There were filed in collectors'
offices during the year 8,313,342 tax returns, compared with 9,144,268
for the previous year, a decrease of 830,926. Of the total tax returns
filed in 1935, there were 5,295,352 income tax returns compared with
4,933,376 filed during the previous year, an increase of 361,976.
Approximately 2,140,000 individual income tax returns, ffied on
form 1040-A, were audited and closed in collectors' offices during
the year, and 4,242,479 information returns were verified. In connection with this audit work 60,268 income tax returns were investigated.
A total of 10,432,005,552 revenue stamps, valued at $941,713,682.42,
was issued to collectors of internal revenue and the Postmaster General, compared with 9,351,968,114 stamps, valued at $833,901,971.05,
issued during 1934. Stamps returned by collectors and by the
Postmaster General amounted to $45,068,828.09, compared with
$52,946,424.83 for 1934.
After the appropriate administrative procedure, collectors of internal revenue transmitted to the Bureau, or otherwise disposed of,
238,251 claims as compared with 151,470 during 1934, an increase of

126

REPORT OF THE SECRETARY OP THE TREASURY

86,781. The number of claims on hand at the close of the fiscal year
1935 was 7,481, compared with 6,878 at the close of the previous year.
The increase in the number on hand at the end of the year was due
principally to the increase in the number of claims filed during the
year and to the necessity of corresponding with processing taxpayers
for additional information before the claims could be forwarded to
the Bureau.
During the year an average of 2,205 deputy coUectors made 576,120
revenue-producing investigations in connection with the verification
of returns, the discovery of delinquent returns, and the serving of
warrants for distraint. The amount of tax involved in these investigations was $81,001,961, including $54,178,708 coUected and
$26,823,253 reported for assessment. The average riumber of investigations made per deputy was 264, and the average amount of tax
collected and reported for assessment was $36,735. The average
salary of the deputy collectors during the year was $1,970; and the
average travel expense, $463. I t will be seen that for every $2,433 invested in the services of a deputy collector $36,735 was returned to the
Government in collections and amounts recommended for assessment.
The $81,001,961 coUected and assessed for the fiscal year 1935,
represents the largest amount produced by the field deputy collectors
since 1920 when the present system of keeping production records
went into effect, and the greatest amount in the hastory of the Bureau.
The amounts involved for the various types of work were:
Collected
Verification of tax returns
Delinquent taxpayers
Warrants for distraint.
Total

Reported for
assessment

$4,129, 111
15,108,117
34,941,480

$11,183, 739
15,639,514

54.178,708

26,823,253

There were 118,221 warrants for distraint served by deputy collectors during the year, and on June 30, 1935, there were 62,132 warrants
in the hands of the field forces for collection as compared with 52,425
on June 30, 1934.
.
Special attention has been given to the discovery of the various
classes of delinquent taxes and to the collection of back taxes. That
these efforts have been successful is evidenced by the fact that the
total collections of such back taxes during the year, amounted to
$185,641,136.64, which is $18,641,136.64 in excess of the estimates
for the year.
The supervisors of accounts and coUections submitted 105 reports
covering their examinations of the accounts of the various collectors'
offices compared with 100 reports submitted during 1934. Every
coUector's office was examined at least once and most of them twice
during the year.
CoUectors^ Personnel, Eguipment, and Space Division.—The organization of the processing tax divisions in collectors' offices was further
strengthened and perfected to facilitate the collection of the processing, import compensating,, and floor taxes imposed upon the
various agricultural commodities under the AgriiG^iiitural Adjustment
Act, as amended. A force of 1,606 permanent and temporary office

EEPORT OF THE SECRETARY OF THE TREASURY

127

and field employees was authorized to handle this work in the
collection districts.
I t was necessary during the year to set up a special section in each
coUector's office in cotton producing districts to administer the tax
collection provisions of the Bankhead Cotton Control Act. During
the ginning season, when the work was at its peak, there were 391
permanent and temporary office and field employees assigned to the
several districts.
In order to carry out the tax provisions of the Kerr-Smith Tobacco
Control Act it was necessary to authorize additional assistance in
the several tobacco-producing districts. During the period when
this work was at its peak there were 85 temporary office and field
employees.
Through the cooperation of the Federal Emergency Relief Administration special projects were inaugurated in certain collection districts
for the purpose of investigating miscellaneous taxes on the manufac-ture of jewelry, radios, furs, sporting goods, cosmetics, admissions and
dues, and documentary stamps. The first project was started in the
third New York collection district on November 1, 1934. Similar
projects were subsequently inaugurated in the first and second NewYork collection districts, the Chicago district, the Milwaukee
district, the Philadelphia and Pittsburgh districts, the Buffalo
district and riiore recently projects were authorized in the Los Angeles
and San Francisco districts. Approximately 800 workers were
employed and, while two of the projects were in operation only a comparatively short time, $5,021,911.80 in taxes have been collected or
reported for assessment. The organization of these forces was accomplished under the direction of the supervisors of accounts and collections in charge, and in addition to the workers assigned to the miscellaneous tax investigations, approximately 330 relief workers were
assigned to the District Supervisors, Alcohol Tax Unit, for conducting
investigations and making inspections of retail liquor dealers.
Disbursement Accounting Division.—The Disbursement Accounting
Division is charged with keeping the internal revenue appropriation
accounts and expenditures and is responsible for the administrative
examination required by law of the accounts of 64 collectors of internal revenue, 38 internal revenue agents in charge of divisions, and
15 supervisors in charge of alcohol tax districts, including the Philippine Islands branch of the collection district of Maryland, and internal revenue salary payments made, by the collector of customs at
San Juan, P. R. The administrative examination of the accounts of
District Supervisors, Alcohol Tax Unit, was transferred to this division effective July 1, 1934, together with some of the personnel previously engaged on that work. The appropriation, accounting, and
the auditing work has been considerably above normal throughout
the year as a result of the Bureau's administrative duties in connection with assessing and collecting the processing taxes.
Office oj the Assistant General Counsel
The activities of the office of the Assistant General Counsel for the
Bureau of Internal Revenue embrace the whole field of Federal taxation in connecjtion with the preparation and presentation to the United
States Board of Tax Appeals of defense in all appeals; the review of
refunds, credits, and abatements, in excess of $20,000; the deciding
16816—36

128

REPORT OF THE SECRETARY ' OF THE TREASURY

and advising in various administrative and internal revenue tax matters referred by the Secretary of the Treasury, the Under Secretary,
or an Assistant Secretary, by the General Counsel for the Department
of the Treasury, by the Commissioner or the Assistant to the Commissioner, by the heads of the administrative units of the Bureau, by
collectors of interrial revenue, by other branches of the Government,
and by individual correspondence; the preparation, at the request of
the Department of Justice or of United States attorneys, of data for
use in the prosecution or defense of tax cases (civil and criminal) in
suit, and otherwise complying with their requests for assistance in
such cases; and the preparation, revision, and publication of regulations. Treasury decisions, mimeographs, and rulings for the guidance
of the officers and employees of the Bureau of Internal Revenue and
others interested. The office is divided into six divisions, viz, Appeals,
Civil, Interpretative, Penal, Review, and Legislative and Regulations,
Assistant General CounseVs Committee.—The Assistant General
Counsel's Committee, formed on July 5, 1933, is composed of five
members. The committee receives and passes upon cases from all
divisions of the office referred to it by the Assistant General Counsel,
the special assistants, and the general assistants. During the fiscal,
year 1935 the Committee received 256 cases and disposed of 237,
leaving 19 cases pending,
Reorganization Section.—The Bankruptcy, Receivership, and Reorganization Section received 1,654 reorganization cases during the
year and closed 164 cases involving claims of $8,093,075.94, which
were settled for $3,847,764.03. A total of 1,249 bankruptcy and
receivership cases were closed involving claims of $6,457,088.57,
upon which $2,554,482.86 were collected.
Appeals Division.—Cases involving income, estate, and gift taxes
filed with the Board of Tax Appeals are in the immediate charge of
this Division. During the year 5,867 cases were closed while 3,816
new cases were filed. At the end of the year there were pending 23
gift tax cases involving $452,164; 504 estate tax cases involving
$73,240,290; and 9,896 income tax cases involvmg $419,955,963; or a
total of 10,423 cases involving $493,648,417. Of this number, 9,405
were pending before the Board and'1,018 were in appellate courts on
appeal from Board decisions.
Cases filed with and closed before the Board of Tax Appeals during the fiscal years
1934 and 1985
1934
Cases

Number

Pending at beginning of year
Filed during year
. .
Total

.......

Closed during year:
By default, etc
By decision on merits
By agreed settlement

. -

Number

Amount

18,080
3,976

$674, 257.340
83,692,291

12,474
3,816

$448,493,080
184,819,113

22,056

657,949,631

16,290

633, 312,193

674
1,518
7,490

Total
Pending at close of year

Amount

1936

500
1,615
3,752

9, 582

209, 456, 551

6,867

139,663, 776

12, 474

448,493, 080

10,423

493, 648, 417

129

EEPOET OF THE - SECEETAEY OP THE TEEASUEY

Civil Division.—The' CivU Division, in cooperation with and at the
request of the Department of Justice, assists in the handling and
preparation for trial of civU internal revenue cases arising in the
Federal district courts, the United States Court of Claims, and the
;Supreme Court of the District of Columbia, together with a limited
number of cases originating in State courts. The trials of such cases
and arguments upon appeals are conducted by the Department of
•Justice pursuant to the President's Executive order of June 10, 1933.
The Division's major activities during the fiscal year are shown in
the following tables:
Civil .cases received and disposed of during the fiscal year 1935 ^
Amount involved

Number
of cases
Pending July 1, 1934:
In court
For suit by the United States-.

205

$216,949,145.81
4,889.613. 93

2,891
1,210

Total
Lien cases in court..
Grand total-.

221,838.759,74

4,101

Received during year:
Suits by taxpayers—
For suit by the United States..
Total
Suits involving liens.
Grand total..
Olosed during year:
Cases, exclusive of lien cases..
Suits involving liens
Total.

661
258

23,070,502.86
6,852, 633,36

919
1,120

28,923,136, 22

963
896

60.244.430.54

1,858

Pending June 30, 1935 (exclusive of lien cases) _
Pending June 30, 1935 (including lien cases)...

2,847
4,282

190, 617,465, 42

1 Excludes bankruptcy, receivership, insolvency, compromise, and liquor cases.

Results obtained in cases closed during the fiscal year 1935 *
Number
of cases
.Suits instituted by taxpayers
Suits and claims by the United States
Total

Amount
claimed

Recovered
from taxpayers

692
271

$45,843,636,66
14,400,793.89

$7, 762,995, 78

963

60, 244,430. 64

7, 762,995, 78

* Excludes bankruptcy, receivership, insolvency, compromise, lien, and liquor cases.

Amount
refunded
$8,895,940.32
8,895,940 32

130

REPORT OP THE SECRETARY OF THE TREASURY
Civil cases pending in courts July 1, 1934 and 1935 *
Julyl,
1934

District courts
Circuit courts of appealsCourt of Claims
Supreme Court
State courts and miscellaneous
Pending payment of judgment claims—

- .

...

.—.

Total

—

Julyl,
1935

1,877
125
576
5
17
86

1,813
117
548
4
21
77

2,686

2,580

1 Excludes bankruptcy, receivership, insolvency, compromise, Hen, and liquor cases.

The number of CivU Division cases tried by the Department of
Justice and also the number decided by the courts are shown in the
following table:
Tax cases tried and decided by the Federal courts during the fiscal year 1935
Cases decided
Cases
tried

Courts

District courts..
Circuit courts of appeals. .
Court of Claims
Sunreme Court

Total

For the
Government

Against
the Government

Partly for
and partly
against the
Government

Total

111
38
82
3

183
43
61
1

81
33
23
1

13
6
1
1

277
82
85
3

234

288

138

447

Compromise Section.—The Section is charged with the responsibility
of considering and passing upon all offers submitted in compromise of
tax .liability arising in the Miscellaneous Tax Unit of the Bureau,
except those involving criminal prosecution, fraud penalties, or specific
penalties. It is also charged with the solution of legal problems
arising in the collection of taxes from banks in liquidation, from taxpayers who have made assignments of assets for the benefit of
creditors, and from estates of deceased taxpayers.
During the fiscal year 493 cases handled in this Section were closed
by acceptance of offers in compromise and the collection of filed claims
in the aggregate amount of $2,747,961.38. The following table
shows the volume of cases handled by this Section:
Pending at beginning of year
Received during year
Total to be disposed of
Closed or in process of closing
Pending at end of year

j
x

,
:

•.

1,246
1,523
2.768
1,240
1,628

EEPOBT OP THE SECBETABY OP THE TBEASUBY

131

The number of cases pending and in process of closing on June 30,
1935, and the tax liability involved are shown in the following table:
Pending
Number
Cash offers in compromise
Installment offers in compromise
Decedent estates
Insolvent banks
.
Miscellaneous cases
Total

Liability

In process of closing
Number

Liability

300
43
899
119
167

$2,027,866
1.221,110
12.002.630
280.936
1,112.220

148
32

$116,658
2.719,309

1.528

16.644,662

180

2,834,867

Interpretative Division.—This Division is charged with the preparation of opinions relating to the administrative construction of internal
revenue laws and the editing of matter for publication in the Internal
Revenue Bulletin. During the year it disposed of 3,039 jacketed
cases, an increase of 802 over the preceding year, in addition to miscellaneous work.
Penal Division.—The Penal Division, in cooperation with the
Department of Justice and the various United States attorneys,
passes upon criminal internal revenue cases; prepares opinions on
liability for percentage penalties for fraud (occasionally for negligence or delinquency^, and on acceptance or rejection of offers in
compromise of tax cases in which such questions are involved. The
Division also prepares opinions interpreting or construing percentage
penalty and criminal statutes, and opinions on all questions of law
involved in a case where there is also a question of percentage penalty
or crime. I t decides upon questions as to whether cases that have
been closed by agreement under section 606 of the Revenue Act of
1928, and similar provisions of the other revenue acts, should be
reopened, because of '^fraud or malfeasance, or misrepresentation of
a material fact", and upon informers' reward claims under section
3463 of the Revised Statutes.
The following table summarizes the work of the Division during
the last two fiscal years:
Cases received and disposed of by the Penal Division during the fiscal years 1934
and 1935
1934

1935

Pending at beginning of year.
Received during year

1,123
1,634

1,624
1,266

Total to be disposed of.
Disposed of

2,767
1,233

2,790
1.588

Pending at end of year

1,524

1,202

132

EEPOET OF THE SECRETAEY OF THE TEEASUEY

Review Division.—This Division reviews cases involving refunds,
credits, and abatements of internal revenue taxes. I t prepares public
decisions in accordance with Treasury Decision 4264 in all cases
where the overassessments exceed $20,000; prepares reports to the
Joint Committee on Internal Revenue Taxation in cases involving
credits or refunds in excess of $75,000, as required by section 710
of the Revenue Act of 1928; and participates in conferences and
negotiations in other Bureau agencies on cases involving proposed
overpayments.
There were 585 cases disposed of during the year involving reductions in taxes aggregating $76,532,905.86. In 141 of these cases
memoranda were prepared. The allowances were reduced by adjustments in this Division in the amount of $2,829,048.32. Some of the
principles involved in these adjustments also affected the disposition
of other cases pending elsewhere in the Bureau. Public decisions
were promulgated in 406 cases, and memoranda were submitted
to the Joint Congressional Committee in 23 cases.
As heretofore this Division has regularly aft'orded conferences in
cases in which issues appeared to require action contrary to the
taxpayer's contentions.
Legislative and Regulations Division.—This division is charged with
preparing, reviewing, and revising regulations under the various
revenue laws, and considering defects in, and proposed amendments
to, such laws; preparing reports on revenue legislation introduced
in the Congress; and rendering assistance in' the drafting of new
revenue legislation. During the year it received 803 cases and
disposed of 513.
Intelligence Unit
The principal work of the Intelligence Unit consists in the investigation of tax-fraud cases. This work is performed in cooperation
with internal revenue agents and deputy collectors. During the
year there were 621 investigations of alleged evasion of income tax
and of this number 159 cases were recommended for prosecution.
On this charge there were 50 convictions, with 1 acquittal, and a percentage of convictions in cases actually disposed of in court of 97.67
percent. Investigation of these cases resulted in recommendation for
assessment of additional taxes and penalties aggregating $20,212,161.
In addition to the collections by the Bureau of Internal Revenue
of taxes, penalties, and interest, amounts are covered into the Treasury by way of fines imposed in criminal cases; in some jurisdictions
the courts have imposed an additional penalty by requiring the
defendants ,to pay the costs of the investigations, that is, the salaries
and expenses of the agents incurred during investigations.
There were also investigated during the fiscal year 147 cases of
charges against employees in the Internal Revenue Service resulting
in the separation from the service of 89 employees and the prosecution of 15, of which number 11 have been convicted and 4 have not
been tried.
There were 2,901 investigations of applications of attorneys and
agents to practice before the Treasury Department and 88 investigations of charges against enrolled agents and attorneys, resulting in
the disbarment of 13, the suspension of 8, the reprimand of 6, and
rejection of applications of 37.

EEPORT OF THE. SECEETAEY OF THE TEEASUEY

133

There were investigated 5,253 cases of miscellaneous character,
which included investigations of the field employees of the Alcohol
Tax Unit; of a number of cases for the Bureau of Narcotics, the
Federal Alcohol Control Administration, the Customs Service, and
National Bank Examiners; and of persons under consideration for
appointment to various positions in the Treasury Department,
including officials of branches other than the Bureau of Internal
Revenue.
LEGAL DIVISION

Organization of the Legal Division, begun the latter part of June
1934, was completed during the fiscal year 1935. The General
Counsel, head of the Division, and six Assistant General Counsel
have charge of all legal matters of the Department.
During the year the Legal Division prepared analyses and recommendations with respect to approximately 650 congressional bills
affecting the Department. The Division also collaborated with the
legislative counsel of both Houses of Congress and furnished technical assistance to congressional committees, particularly in matters
relating to banking, taxation, and social security legislation.
The Division drafted, among other documents. Executive orders
and proclamations relating to newly mined domestic silver, nationalization of silver, restrictions imposed on payment of money out of
the German special deposit account, allocation of relief funds for
continuance of rural health service, and the release of property held
by the Alien Property Bureau; and the Secretary's orders and regulations covering the exportation of silver and importation of foreign
silver coin and transactions in foreign exchange. The Division also
cooperated with the Department of Justice in preparing a large number of cases in which the Treasury was interested, most outstanding
of which were the so-called " gold clause cases." During the year,
83 formal legal opinions and numerous informal opinions were prepared for the information and guidance of the administrative officers
of the Department. The legal sufficiency of a number of applications
for relief projects was passed upon and approximately 5,000 surety
bonds were examined and approved.
The Division conducted several legal research projects, including an analysis of the disposition of Treasury criminal cases in
United States District Courts, a general survey of criminal law
enforcement problems affecting the Departnient, and a compilation
of statistics concerning Treasury offenders. Progress was also made
in analyzing the causes of congestion in income tax and customs
litigation. The work of compiling State and municipal ordinances
and court decisions relating to public health matters was carried
forward during the year. Regulations were drafted governing the
admission, custody, and discharge of persons at United States narcotic farms and assistance w^as rendered tO' State authorities in connection with the adoption and enforcement of the uniform State
narcotic law.
Legal questions were considered in connection with the formulation of regulations, issued June 29, 1935, by the Foreign Trade Zones
Board (composed of the Secretaries of Corrimerce, Treasury, and
War) respecting the act approved June 18, 1934, for the establishment, operation, and maintenance of foreign trade zones in the

134

REPORT OP THE SECRETARY OP THE TREASURY

United States. Assistance was also rendered in formulating the text
of foreign trade agreements negotiated with 5 countries' and in the
course of negotiation with 13 other countries.
The Division was concerned during the year with the legal aspects
of the acquisition of 382 sites for construction purposes. A total of
^51 contracts covering construction and related work were prepared,
.and more than 2,000 contracts prepared by the Branch of Supply of
the Procurement Division and by other agencies of the Department
were examined for legal sufficiency.
A revised edition of " Coast Guard Courts and B o a r d s " , and
instructions for the guidance of Customs and Coast Guard officers
in the enforcement of the Oil Pollution Act of 1924 were prepared
during the year. I n addition to reviewing the record of proceedings,
the Division prepared the action of the reviewing authority in 88
.general court cases, 166 summary court cases, and 287 deck court
'Cases, and in 208 boards of inquiry, inquest, and investigation. I t
reviewed also as to legal aspects the record of proceedings in 116
retiring board cases. Twenty-one claims against the Government
involving Coast Guard units and five claims of the Government
:against private parties involving Coast Guard units were examined
.and appropriate action in such cases was advised. A total of 23
life-saving medal of honor cases were examined and the necessary
^action taken to bestow awards in 7 such cases.
I n the field of taxation the Division prepared and presented to the
United States Board of Tax Appeals the defense in all appeals;
reviewed arid finally disposed of refunds, credits, and abatements in
all cases where the amount involved exceeded $20,000; decided and
advised in various administrative and Internal Revenue matters,
including matters arising in corporate reorganization under section
77B of the Bankruptcy Act; prepared data for use in the prosecution or defense of tax cases (civil and criminal) in suit; handled
the preparation and publication of regulations. Treasury decisions,
and rulings for the guidance of officers and employees of the Bureau
of Internal Revenue and others concerned; and reviewed a large
number of cases of offers in compromise, extensions of time to pay
tax, and closing agreements before transmission from the Commissioner of Internal Revenue to the Secretary for approval. The Division also acted on 922 petitions for the remission or mitigation of the
forfeiture of vehicles and other property which had been seized by
<jovernment officers for violations of the laws pertaining to the manufacture, sale, and transportation of alcohol.
BUREAU OF THE MINT

Institutions of the Mint Service
During the fiscal year 1935, six Mint Service institutions were in
operation: The coinage mints at Philadelphia, San Francisco, and
Denver; the assay office at New York, which handles much importexport gold; the mint at New Orleans conducted as an assay office;
and the assay office at Seattle. The tw^o last-named institutions
are, in effect, bullion-purchasing agencies for the larger institutions
and also serve the public by making assays of ores and bullion. Electrolytic refineries are operated at the New York, Denver, and San
Francisco institutions.

REPORT OF THE SECRETARY OF THE TREASURY

135

Govaage
The United States mints executed during the fiscal year 608,414,207
pieces of domestic coin and 68,500,401 pieces for foreign governments,.
a total of 676,914,608 pieces. This compares with the prior year's
total of 65,674,250 pieces consisting of 46,634,250 pieces of domestic
coin and 19,040,000 pieces of foreign coin. The output of coins
during the year has been exceeded only twice—in 1918 w^hen the
total was 766,887,460 pieces, and in 1920, 809,708,484 pieces.
The 1935 output of domestic coins consisted of 134,166,204 pieces
of silver coin, including 5,635,557 silver dollar pieces, and 474,248,003 pieces of minor coin, of which 412*266,000 pieces were bronze
1-cent coins. The value of the domestic coinage executed was
$39,131,127.65, as compared with the prior year's $3,499,125. The
coinage mints operated for long periods on the basis of 2 or 3 shifts
daily. The great demand for domestic coin during the year reflected
increased business activity.
The foreign coinage executed consisted of 67,100,401 silver pieces,.
200,000 nickel pieces, and 1,200,000 bronze pieces, for Mexico, Cuba,
Panama, Honduras, Nicaragua, Colombia, and Venezuela. The foreign orders were extraordinarily large and were occasioned, in part,.
by the rise in the price of silver, which necessitated withdrawal from
circulation and replacement of the silver coins of some countries
because the silver in the old coins would produce greater returns,,
when marketed, than the face value of the coins.
Bullion deposit transactions
A new high record was established during the year for the number of bullion deposit transactions of the mints and assay offices.'
The total was 226,701 as compared with 115,870 for the preceding
year, 73,238 in 1933, 54,105 in 1932, and 36,098 in 1931. The increase
over 1934 was more than 95 percent, and over 1931, 528 percent..
Receipts of both gold and silver in the form of newly mined metals,,
secondary material, and imports, and receipts of the nationalized
domestic holdings of refined silver, were very large and necessitated
large increases in personnel.
Gold operations
Gold acquired by the mints and assay offices during the year
amounted to $1,301,432,727.11; gold transfers to the mints and assay
offices consisted df $34,692,338.60 of bullion from the Federal Reserve
banks, and $1,524,989,826.51 of domestic coin from other Treasury
offices. Intermint service institution transfers amounted to $2,081,805,348.96. These items total $4,942,920,241.18, which compares'with
$989,932,126.68 for the prior year.
The acquisitions include $120,091.28 of gold received at $20.67 +
per fine ounce, which had not previously been surrendered under
the nationalization orders; the increment to $35 per fine ounce
amounted to $83,245.09. The intermint institution transfers consisted almost wholly of gold shipped from the San Francisco Mint
to the Denver Mint for storage.

136

REPORT OF THE SECEETAEY OF THE TEEASURY

Silver operations
Silver acquired during the year totaled 437,798,807 fine ounces, at
an average cost of 53 + 0 per fine ounce and a total cost of $232,435,879. The acquisitions consist of the following:
Amount
(fine ounces)

Item
Newly-mined domestic silver
Nationalized silver
Purchase Act silver..
.
.
.
Silver contained in gold bullion deposits, etc
Silver received in exchange for Government stamped bars
Total

-.
.

Value

30,863, 349
112, 301; 335
293, 737,702
699, 422
296,999

$20,214,113
56,162, 471
155, 587, 533
310,834
160,928

437, 798,807

232, 435,879

United. States coin received for recoinage totaled 5,878,270 fine
ounces, with a recoinage value of $8,125,809; silver deposited in trust
by other governments totaled 18,007,498 fine ounces; and silver transfers between Mint Service institutions amounted to 176,401 fine
ounces. These items plus the silver acquired during the year
amounted to 461,860,976 fine ounces, as compared with 55,707,098
fine ounces for the previous year.
During the year 242,324,825 fine ounces of silver were revalued to
$1.29+ per fine ounce, the statutory monetary value, and set up as
security against silver certificates. The monetary value was $313,308,863; the cost, $124,320,771; and the seigniorage, $188,988,092.
The open market price of silver in New York (mean of bid and
asked) during ihe fiscal year 1935 averaged $0.5764. The lowest point
was $0.463125 on July 23, 24, and 26, 1934; and the highest, $0.813125
on April 26, 1935. The prior year average was $0.4254, and the range
wras $0.353125 to $0.470625.
The price paid under the President's proclamations for newly mined
domestic silver was $0.6464+ per fine ounce until April 9, 1935,
$0.7111+ until April 23, and thereafter $0.7757 + .
Commemorative coins
The following commemorative half-dollar coins of new design were
executed during the year:
Date of law

Event

May 14,1934
June 21,1934
May 2,1936

Arkansas, centennial of statehood- -. _
Connecticut, tercentennial of founding
Hudson, N. Y., 150th anniversary of founding..

Pieces
500,000
25,000
10,000

Commemorative half dollars which have been authorized but not
yet issued are as follows:
Date of law

Event
Providence, R, I., tercentennial of founding
California-Pacific International Exposition .
.
Old Spanish Trail, four hundredth anniversary of opening

. .

May 2,1935
•May 3,1935
June 6,1936

Pieces
60,000
250,000
10,000

Refineries
The electrolytic refinery at Denver remained closed throughout the
year by reason of more urgent activities. The refineries at New York
and San Francisco produced during the year 2,388,328 fine ounces

EEPOET OP THE SECEETAEY OF THE TEEASUEY

137

(81.9 tons) of electrolytically refined gold, as compared with 2,387,817 fine ounces (81.8 tons) during the previous year; and 1,336,572
fine ounces (45.8 tons) of electrolytically refined silver, as compared
with 703,284 fine ounces (24.1 tons) in the prior year.
The stock of gold and silver in unrefined bullion on hand increased
by about 80 tons to 1,009 tons, as compared with the prior year's
increase of 99 tons.
Stock of coin and) monetary bullion in the United States
On June 30, 1935, the estimated stock of domestic coin in the
United States was $991,097,706, of which $545,641,802 was standard
silver dollars, $312,416,169 subsidiary silver coin, and $133,039,735
minor coin.
The stock of gold bullion, including coin, held in the Treasury on ,
the same date was valued at $9,115,380,809, an increase over the
previous year of $1,259,200,253; the stock of silver bullion was 482,989,512 fine ounces, an increase of 423,512,556 fine ounces.
Production of gold and silver
Domestic gold production during the calendar year 1934 was
3,091,183 fine ounces with a value of $108,191,400 at $35 per ounce,
as compared with 2,556,246 fine ounces with a value of $52,842,300
at $20.67+ per ounce in 1933. The output was about 61 percent
in quantity of that for the record year 1915, when the total was
4,887,604 fine ounces, valued at $101,035,700 at $20.67+ per ounce.
, .Domestic silver production during 1934 totaled 32,725,353 ounces,
valued at $21,155,784 on the basis of the Government's buying pric(3
of 64+0 per ounce, as compared with 23,002,629 ounces, valued at
$8,050,920, for 1933. The record production of 1915 was 74,961,075
fine ounces, valued at $37,397,300.
Industrial consumption of gold and silver
Gold consumption in the industrial arts during the calendar year
1934 is estimated at $14,232,795. Gold returned from industrial use
exceeded the total used by industry by $61,694,490,.as compared with
an excess of $5,792,700 during the previous year.
Silver used in the arts is estimated at 39,678,603 fine ounces, of
which 11,492,425 fine ounces was new material.
As compared with the prior year, silver consumption increased
about 700,000 ounces while gold consumption decreased about
417,000 omices.
Appropriations^ expenses^ and income
Regular appropriations available for the Mint Service during the
fiscal year 1935 totaled $1,108,559; additions for salary rate restorations, $50,688; allotments for meeting emergency expenses, $2,009,161;
and reimbursements to appropriations for services rendered, $604,681; making a grand total of $3,773,089.
Expenses amounted to $3,573,606, of which $3,475,340 was chargeable to appropriations and $98,266 chargeable to income.
The regular income realized by the Treasury from the Mint Service
aggregated $13,899,655, of which $9,179,144 was seigniorage. The

138

EEPOET OF THE SECEETAEY OP T H E TREASUEY

seigniorage on silver dollar coin was $2,823,827; on subsidiary silver
coin, $380,632; and on minor coin, $5,974,685. Extraordinary income
aggregated $189,071,337 of which $188,988,092 was seigniorage bn
silver bullion revalued to $1.29+ per ounce, and $83,245 was the
increment to $35 per ounce on revalued gold.
The number and value of deposits, transfers, gross income, and
expenses for the fiscal year 1935, and the number of employees on
June 30,1935, at each institution are shown in the following table:
Deposits of gold and silver, income, expenses, and nimiber of employees, hy
imstitutions, fiscal year 1935

Institution

Philadelphia
San Francisco
Denver..
New York
New Orleans
Seattle-—
—
Discontinued field oflQces...
Total
Bureau of the Mint
Grand total
Prior fiscal year

Number of
deposits
of gold
and
silver

Monetary
Number of value of gold
and silver
Mint
received,
Service
Including
transtransfers
fers

65,458
70,813
13,288
69,989
4 909
6 065
0

2,646 $224,560,480
2.733
699.471. 312
794 2.782,906,816
6 1.895, 056,104
0
2, 932, 678
0
12,172,925
0
0

Gross
regular
income

Gross
expense

Number of
Excess of
Income (+) employees,
or of expense ( - ) June 30,
1935

$5,802,949 $1,149.802 $+4,663,147
533,631 +1,946.469
2.480.100
479,132 +1.738.854
2, 217.986
633,168 +2, 713.404
3.346.562
31,682
-18.370
13. 212
34,453
+ 3 462
37.915
102
+829
931

839
378
265
283
18
15
0

220, 522
0

6.179 5,617,089 316 13.899.666
0
0
0

2,861 860 +11.037 796
1 737 006
-737 005

1,798
65

220.522

6.179 5,517,089,316 13.899.655

3,698,865 +10.300. 790

1,853

115.870

3.176 1,039,079, 658 3.118.918

1, 248, 749 +1,870,169

607

1 Includes $624,496 for transportation of bullion, principally for gold movement from San Francisco to
Denver mints.

BUREAU OF NARCOTICS

Enforcement activities
The Bureau's policy of directing its principal enforcement activities against major narcotic law violators has resulted in a progressive
reduction in the supply of narcotics available to the domestic illicit
traffic. This is indicated by the continued high prices of the drug in
the illicit market, the high degree of adulteration found in drugs
seized, and the marked decrease in the drugs seized, this decrease
being noted in the seizures made at ports and borders. Greatly increased activities on the part of narcotic enforcement officers resulted
in increased seizures in the internal traffic, and an increase in the violations reported. The total violations reported by narcotic officers exceeded those reported during the previous year by approximately 35
percent.
The decrease in the supplies of smuggled narcotics has forced peddlers and addicts to turn more and more to the channels of legitimate
distribution for their supply. The robbery of wholesale and retail
stocks, the forgery and false execution of narcotic prescriptions, and
the improper prescribing and dispensing of narcotics are accordingly
becoming more of an enforcement problem. Of the total violations
reported during the year, 33 percent involved persons registered under
the law, as compared with 30 percent involving such persons during
the year 1934, 18 percent during 1933, and 14 percent during 1932.
However, due to measures initiated by the Bureau to provide in

139

REPORT OF T H E SECRETARY OP THE TREASURY

creased safeguards and more secure places of storage for narcotic
stocks in the hands of registrants, the number of thefts reported
and the amounts of drugs involved declined slightly during the year.
The Bureau solicits and continues to receive the cooperation of
State and municipal enforcement agencies. The activities of these
agencies become more effective with the adoption and enforcement of
the Uniform State Narcotic Law. The law was adopted with little
or no amendment during the fiscal year 1935 in 18 States—Arizona,
Colorado, Connecticut, Delaware, Georgia, Indiana, Louisiana, Maryland, Massachusetts, Nebraska, New Mexico, North Carolina, Ohio,
Oklahoma, Oregon, South Dakota, Utah, and West Virginia. This
makes a total of 26 States which have adopted this legislation. It
had been previously adopted by Florida, Kentucky, Nevada, New
York, New Jersey, Rhode Island, South Carolina, and Virginia.
The following table shows the number of cases of violation, by registered and nonregistered persons, of the narcotic law^s and the cases
disposed of during the fiscal year as reported by Federal narcotic
enforcement officers:
Violations of the narcotic laws and the oases disposed of durvng the fiscal year
1935
Registered persons
Federal court
Pending July 1,1934
Reported during 1936:
. Federal
Joint...
Total to be disposed of

State court

912

1,211

2,068
38

3.146
1,041

218
13

1,843
533

305
194

10
1
1,179
23

61
16

13
11

748
142

49
29

478
8

Joint
Total disposed of.
Fending June 30,1936...

Sentences Imposed:
Federal
Joint

384
25

Total-

409

Total-

Federal court

3,018

Convicted:
Federal
:;-.
Joint
Acquitted:
Federal
Joint
Dropped:
Federal
Joint
Compromised: *
Federal

Fines Imposed:
Federal
Joint

Nonregistered persons

1,948

3,936

1,070

1,462

3,934
948

232
192

4,883

424

$33,376.26
2,505.00

$601.00
425.00

$100,949.00
11,797.03

36,881.25

926.00

112,746.03

22
20

$19, 649. 74
5,628.64
26,178.28

1 Represents 99 cases involving tax liabihty which were closed on payment of taxes and penalties in the
sum of $872.18; and 389 cases wtiich were compromised in the sum of $31,498.60.
NOTE.—Federal cases are made by Federal officers working Independently, while joint cases are made by
Federal and State officers working m cooperation with each other.

140

REPORT .OF THE SECEETAEY- OF- THE TEEASUEY
Extent and trend of narcotic trafiic

On June 30, 1935, there were 325,465 registrants under the Harrison Narcotic Law, as amended, 206 as importers and- manufacturers,
1,405 as wholesale dealers, 51,080 as retail dealers, 148,317 as practitioners, and 124,457 as dealers in and manufacturers of untaxed
narcotic preparations, the latter number including registrants not
required to pay occupational tax under the act.
During the year 120,490 pounds of opium were imported, as compared with importations of 131,194 pounds during the previous year,
or a decrease of 10,704 pounds. Coca leaves were imported for medicinal purposes only and amounted to 194,132 pounds, as compared
with importations of 246,679 pounds during the previous year, or a
decrease of 52,547 pounds.
Exports of narcotic drugs of all kinds amounted to 1,551 ounces
in 1934 and 1,579 ounces in 1935, or an increase of 28 ounces. The
drugs exported during 1935 involved 38,824 taxable ounces of
products.
The net quantity of pure drugs of all kinds sold to domestic purchasers by manufacturers amounted to 375,248 ounces, as compared
with sales of 374,622 ounces during the previous year.
DIVISION OF PRINTING

Treasury Department Order No. 10, of April 23, 1935, changed the
name of the Division of Supply to the Division of Printing, and.
transferred to the Procurement Division the purchasing functions
and the storage and distribution of stationery supplies.
The Division of Printing transacts all of the Treasury Department's printing and binding business with the Government Printing
Office. This involves the placing of all orders, the handling of a l l
inquiries regarding deliveries, estimates of cost, copy, proof, instructions, and the auditing of vouchers covering.payments in connection
therewith. I t is charged with editing and preparing, weekly
" Treasury Decisions " under customs, internal revenue, narcotics,
and other laws; preparing semiannual bound volumes thereof, and.
maintaining a mailing list for their distribution. I t is also charged
with the responsibility of authorizing engraving work to be done by
the Bureau of Engraving and Printing for all Government departments and establishments unless money, bonds, or stamps are i n volved; control over newspaper and periodical advertising for the
Treasury Department; binding confidential Department records; and
the warehousing and distribution of blank books and forms for Washingtori . and field offices of the Department. Appropriations to the
Department for printing and binding and for purchases of station-,
ery supplies are under the administrative control of the Division.
The total expenditures ^ of the Division during each of the past 2
fiscal years are shown' in the followirig table:
^ The table showing expenditures from allotments made to the Division from various
appropriations, formerly, appearini? in the" report of the Division o'' Supply is included
in the report of the Branch of Supply, Division ofi Procurement. (See p. 147.)

EEPQET OF THE SECEETAEY OF THE TEEASUEY

141

Expenditures for. the fiscal years 1934. and 1935, by appropriations
Appropriation

1934

Printing and binding, Treasury Department
Printing and binding, Treasury Department 1935-36 (second deficiency)
Printing and binding, other appropriations-_.—...•.•...:.•..-.."..
Ftationery, Treasury Department
..
..

1 $597, 638.61

• 1936

282,420.69
359, 248, 74

1 $672, 639, 00
5,000. 00
333, 224-32
454, 599.-80

1, 239, 307.94

1, 465, 463.12

1 I n c l u d e s receipts from sales of c u s t o m s forms (reimbursed to t h e a p p r o p r i a t i o n ) .

Printing and binding
The appropriation for printing and binding iov the fiscal year
1935 was $525,000. This amount proved insufficient to cover the needs
of the Treasury Department, and $78,750 was transferred from the
appropriation "Collecting the Internal Revenue, 1935", as well as
$24,750 from the indefinite appropriation carried in the act of March
28, 1934, which provides funds to cover the increased cost due, to
legislation reducing hours of labor in the Government Printing Office.
I t was also necessary to obtain $17,500 in the First Deficiency Act.
With these additions, $646,000 was available from appropriations
for 1935. Due to the heavy demands made on the Department for
printing and binding, it later was necessary t o obtain additional
funds in the Second Deficiency Act of 1935-36, in the surii of $48,760.^
Of this amount, $5,000 was applied to cover encumbrances for 1935.
Thus there was available from appropriations a grand total of
$651,000 for printing and binding for the Treasury Department in
the fiscal year 1935.
Reimbursements of $26,839 from sales of customs forms iricreased
the total available amourit to $677,839. Of this sum, $677,639 was
expended, leaving an unobligated balance of $200. I n addition,
$333,224 was expended from appropriations other than the printing,
and binding appropriation made by Congress, bringing the total
expenditure to $1,010,863.
Appropriations, expenditures, and reimbursements for- printing and binding for
the jfiscal years 1934 and 1935 ^
. SUMMARY

. .'
1934

1935

Appropriation, printing and binding. Treasury Department
Printing and binding. Treasury Department, 1936-36 (second deficiency)
Reimbursements from sales of customs forms
Expended from other appropriations
..

$575,000.00
23,714.50
282,420.69

$646,000.00
5,000.00
26,839:00
333,224.32.

Total available Total expenditures
..1.

881,135.19.
.880,059.20

1,011,063.32
1,010,863.32

1,076.99

'200.00

Balance

-..1
-..'..--._.-....
..i

-..--.

.S.......J.....
-._.-

1 Figures subject to slight variations, due to necessary delays in receiving bills from the Public Printerfor certain Items until pending work is completed after the close of each fiscal year.
.

142

REPORT OF THE SECRETARY OF THE TREASURY

Appropriations; expenditures, and reimbursements for printing and binding for
the fiscal years 1934 and 1935—Continued
EXPENDITURES

F R O M A P P R O P R I A T I O N S FOR P R I N T I N G AND BINDING, BY
BUREAUS, OFFICES, AND DIVISIONS
1935

Secretary, Under Secretary, and Assistant Secretaries
Appointment Division
Bookkeepmg and Warrants Division
Bureau of Engraving and Printing
Bureau of Industrial Alcohol
—
Bureau of Narcotics
Chief Clerk and Superintendent
Coast Guard
Commissioner of Accounts and Deposits.
Oomptroller of the Currency
Custodians of public buildings
1..
'Customs
Division of Disbursement
Division of Supply (Printing).3.._
_..._
General Supply Committee (Procurement—Bureau of Supply) 2.
Oovernment Actuary
•.
Internal Revenue/
Mint
,
National bank depositaries
Public Debt Service
.
Public Health
Secret Service
,
Supervising Architect (Procurement—Public Works Bureau) K.
Treasurer of the United States
•.
Miscellaneous and department stock
TotaL..

$8.874.72
495.02
27,290.86
4,976.53

$8, 701. 77
449.45
23, 684. 66
4, 134.92
19. 248. 21
4, 474. 36
1, 662.17
18. 161.31
394.32
133. 20
710.33
31, 969,15
696.07
7, 022, 76
241, 552. 79
1, 683. 39
227, 325.90
6, 683,85
1. 787, 62
10, 445.35
60, 477. 87
723.40
23, 700.65
13, 818. 95
592.68

61,701.12
642. 77
3 4.139, 43
2 44.796, 77
1.782,10
292.267.38
6.923.28
1. 602. 77
12.588. 20
64.747. 39
696.97
2 6,671.34
12.196.62
66,064.66

673.924.01

650,800.00

3,840.71
538.40
23,080.16
• 882.61
25,101.29
(2)

2 In October 1933, there were transferred to the Procurement Division the custodians of public buildings,
Oeneral Supply Committee, and OflSce of Supervising Architect.
3 In April 1935, title changed to Division of Printing.
REIMBURSED AND E X P E N D E D FROM OTHER APPROPRIATIONS
1934
Administration of the Cotton Act, 1934 (transferred to Internal Revenue^
administrative expenses)
Advances to Department of Agriculture under Tobacco Act of June 28,1934
(transferred to Internal Revenue, administrative expenses)
Advances to Agricultural Adjustment Administration:
Division of Disbursement
Internal Revenue
Treasurer of the United States
Civil Works Administration
Collecting the revenue from customs
Contingent expenses, national currency:
Comptroller of tne Currency
National Bank Redemption Agency..
Customs Service, Puerto Rico Tariff Fund
Emergency Conservation Fund
Emergency Relief, administrative expenses
Expenses, Emergency Banking, Gold Reserve and Silver Purchase Acts
Expenses, National Banking Emergency Act of Mar. 9,1933
Expenses of loans (act of Sept. 24, 1917, as amended and extended)
Expenses, Settlement of War Claims Act of 1928
Federal Deposit Insurance Corporation
:
Fuel yard, Procurement Division
General Expenses, Agricultural Adjustment Administration (transferred
to Treasury Department; Division of Disbursement)
Insolvent National Bank Fund
National Industrial Recovery
Procurement Division
Salaries and expenses. Bureau of Engraving and Printing
Salaries and expenses, Division of Disbursement
Salaries and expenses, national bank examiners
Working Fund, Emergency Relief
.
Working Fund, Home Owners' Loan Corporation
Working Fund, Treasury Department:
Division of Disbursement
Public Health Service
Treasurer of the United States
Customs Service, blank forms..
Total

$5,645.07

1935

$57,487.35
1,376.04

73.174.95
809,01
90,476.57
268, 75
1. 636, 31
14.190. 70
63.96
1,685.74
8,917.79
34,186. 36
108. 21
33, 200. 20
3L63
594.00
215. 60
85L84
704.99
2,864, 67
9,946. 71
3,028, 39
3L35

821.94
46,015.33
2,103.12
2, 262.06
366.87
2,233.53
12.76
28.038. 27
12,920.54
126,589. 76
27.21

1,941.47
648.97
122. 53
1,023, 25
; •584,32
20,792.18
10, .639.56

15,431.07
83.10
2,713.11
282,420.69
23, 714. 60

333,224.32
26,839.00

306,136,19

360,063.32

EEPOET OF THE SECRETARY OF THE. TREASURY

143

Stationery supplies
The appropriations, reimbursements, and expenditures for articles
of stationery for the past two years are summarized in the following
table:
Appropriations, rei/tnbursements, and expenditures for stationery for the fiscal
years 1934 and 1935
1934
Appropriations
Reimbursements
Available credits.
Total expenditures
Balance...

1935

$325, 000. 00
34, 513. 08

$413, 000. 00
42,100. 00

359, 513. 08
359, 248. 74

455,100. 00
454, 599. 80

264.34

500. 20

Department advertising
Authorizations to publish advertising were issued tO' 4,604 newspapers and periodicals in the fiscal year 1935, compared with 2,605
in 1934, an increase of 1,999. The expenditures authorized were
$37,911.20 in 1934 and $5-7,060.42 in 1935, an increase of $19,149.22.
Engraving work
A total of 99,756,992 certificates, checks, commissions, drafts, transportation requests, and warrants was approved by this office for
execution by the Bureau of Engraving and Printing for the several
departments and establishments of the Government during the fiscal
year 1935, compared with 142,025,685 in the preceding year.
PROCUREMENT DIVISION

The functions of all agencies pertaining to policies and methods of
procurement, warehousing and distribution of property, facilities,
structures, improvements, equipment, and supplies are consolidated
in the Procurement Division, which comprises two main branches,
the Branch of Supply and the Public Works Branch.
During the fiscal year 1935 the Procurement Division took an important part in the organization of the Works Progress Administration
and in the formulation of its policies especially with respect to contracts and purchases. The Executive order of May 6, 1935, directed
the Secretary of the Treasury, through the Director of Procurement,
to purchase, or to provide a system for the purchase of, all materials,
supplies, and equipment to be procured from funds allotted under the
Emergency Relief Appropriation Act of 1935. The basis for the
Executive order of June 24, 1935, defining the methods of procedure
under which projects shall be prosecuted was prepared by the Division.
Branch oj Supply
The Branch of Supply determines policies and methods of procurement, warehousing, and (hstribution of property, equipment, and sup16816^-36

144

REPORT OP THE SECRETARY OF THE TREASURY

phes. During the fiscal year 1935, further consolidation of functionswas effected, including: The transfer of the purchasing functions and
activities involving the storage and distribution of stationery and
supplies of the Division of Supply of the Treasury Department;,
transfer of all records of the General Counsel pertaining to real estate
acquired by the United States in nonpayment of debts; and transfer
of the functions of the FederalCon tract Board, the Federal Specifications Board, and the Federal Standard Stock Catalog Board, which
were abolished. The regulations of the Secretary of the Treasury and
the Attorney General issued on February 27, 1935, provide that forfeitures of distilled spirits, including pure and denatured alcohol and
wines, shall be reported to the Director of Procurement and disposed
of as provided by regulations governing the operations of the Branch
of Supply.
In connection with purchases made during the fiscal year, 17,409
bids were received involving 51,398 samples, and 6,789 contracts'were
awarded, the value of which aggregated approximately $37,000,000.
Consolidated contracts were executed during the year covering
tank car, tank wagon, and steel drum deliveries of motor gasoline for
all Federal activities in 12 States, and, effective July 1, 1935, covering
drayage service for all Federal activities in 55 cities.
Material, supplies, and equipment received at the Federal warehouse
amounted to 26,723,095 pounds, and deliveries to departments and
establishments aggregated 21,681,459 pounds. The number of items
stocked in the warehouse increased from 850 on July 1, 1934, to 1,925
on June 30, 1935.
The fuel yards issued and delivered to the departments and establishments 318,766 tons of coal, 247 coT'ds of wood, 10 tons of charcoal,
71 tons of coke, and 70,338 barrels of oU, valued at $1,925,266. Storage and reimbursable work performed amounted to $42,296.
The typewriter repair shop completed 1,579 overhauls and 13,265
adjustments of typewriters for Government activities in Washington,
representing charges of $20,601.
The Federal Real Estate Section handled 4,013 requests for clearance to lease property, 84 applications to purchase, 39 applications
to sell real property, and 93 transfers of land or buildings among the
departments and establishments, including 57 C. C. C. camps declared
surplus by the Director of Emergency Conservation Work. In the
active Federal buU(hngs, 129 assignments of space to Federal activities were effected, and 84 assignments of space were made in abandoned Federal buildings.
The Federal Traffic Section issued 2,636 routing orders, covering
29,666 cars, in addition to routing 6,068 less-than-carload shipments,
and furnished 51,952 rate quotations to the departments and establishments.
The Federal Specifications Division promulgated 112 new specifications, 50 revisions, and 93 amendments to Federal specifications,
bringing the total specifications in effect to 989. In addition 76 new
proposed specifications and 61 proposed revisions were submitted to
the departments for comment and criticism.
The Federal Surplus Property Section handled 2,821 lists of surplus
property in the field, effecting 2,270 transfers to Federal activities
and granting 1,583 clearances for sale. There were transferred to
Federal activities 6,856 gallons of forfeited alcohol and 820 gallons of

REPOET OF THE SECRETAEY OF THE TEEASUEY

145

whisky. Proceeds from the sale of surplus property at auction and
waste material in the District of Columbia amounted to $89,765.
The Motor Equipment Section completed 3,287 repair orders and
dispensed 203,035 gallons of gasoline and 7,118 gallons of oU.
During the fiscal year numerous requests of executive departments
to deviate from standard forms were handled, recommendations were
submitted to the Director of Procurement for the revision of standard
forms, and studies were made of contracts and contract procedure.
The Federal Catalog Section accomplished considerable work in
connection with the preparation and revision of sections 1, 2, and 3 of
the Federal Standard Stock Catalog, together with checking and
arranging the stock lists of the various departments and establishments.
Tbere were 135 Federal business associations, whose membership
comprises Federal officials and employees, actively functioning as
agents of the Director of Procurement. The associations rendered
considerable assistance to the Procurement Division in the preparation
and execution of consolidated drayage contracts, and made distinct
achievements in the loan of property and surveys of electric power
consumed by Federal activities.
Until certain sections of the National Industrial Recovery Act were
declared invalid, the Branch of Supply acted as general liaison officer
between the Government activities and the National Recovery
Administration in matters arising from the application of Executive
Order No. 6646.
The financial status of the Branch of Supply at the close of the fiscal
year 1935 is shown on the attached statements:
Statement of the working assets of the Branch of Supply for the fiscal year 1935
Inventory, June 30, 1934:
Warehouse (marked-up basis)
Less warehouse mark-up

.—
---

Warehouse (cost)-.:
.
—.„
Fuel yard (cost)
Motor equipment ( c o s t ) . . . . . . . . . .
Typewriter repairs (cost)
Opening Inventory
Purchases..
TotalLess cost of goods sold
Closing inventory June 30, 1935:
Warehouse (marked-up basis)
Less warehouse mark-up
Warehouse (cost)
Fuel yard (cost)
Motor equipment (cost)
Typewriter repairs (cost)

...-

$230,836.84
14,579. 28
6,297.50
210.00

.
..-

—-

Closing inventory, June 30, 1936

$242,378.68
11.541.84 .

---

$250,923. 62
5, 534, 243. 63
- 5, 785,167. 25
5,173,336.06

594,166.32
28,176.24
565,990,08
37, 538. 34
7,058.50
1, 244. 27

-..-

611,831.19

146

EEPOET OF T H E SECEETAEY OF T H E TEEASUEY
Balance sheet of the Branch of Supply as of J u n e SO, 1935
ASSETS

Current assets:
Treasury cash
Disbursing officer's cash
Disbursing officer's cash, special deposit
Liberty bonds in trust-.
Accounts receivable
,
Less undistributed receipts
-

.-,
-

Accounts receivable, typewriter repairs
Accounts receivable, general fund revenue

—

-...- $560,512.46
228.37

_----

Total current assets

660, 284. 09
5,005. 37
8,417,39
910,995. 36

Inventories and deferred charges:
Inventory, warehouse (cost),
Inventory, fuel yard stores.-.
^
Inventory, garage stores
Inventory, typewriter repair stores

:.
-

---

565,990. 08
37, 538.34
7,058. 50
—-1, 244. 27

Inventory, rejected material...
Unbilled costs (appropriations)
Deferred charges, 1934 and prior years.
Advances, Supply Division...

Total inventories and deferred charges..
Fixed assets:
Equipment
Less reserve for depreciation
Land, buildings, donated--Equipment, donated...

611,831,19
12,889.40
3,905.39
13,453.96
450,79
642,530.73

18,883. 80
9,974.48

--.

Total fixed assets

8,909,32
482,984.32
127,327.65
619,221,29

Total assets..-.

2,172,747.38

LIABILITIES
Current liabilities:
Unvouchered invoices......
Special deposit obligations.
Liberty bond accountability
Surplus property accountability
Rejected material returnable to contractors

$462,636.70
38,771.79
2,400,00
8,417, 39
12.889.40

Total current liabilities

525,115.28

Reserves:
General fund revenues, 1934 i
General fund revenues, 1936.

121,999.39
138,300,44

Total reserves

Fixed liabilities, appropiiations and surplus:
Property and equipment, donated
Unencumbered appropriations
Unhquidated expenses, appropriations
Capital, general supply fund..
Surplus, general supply fund
Surplus, reserve, typewriter repairs, general fund revenue

260, 299.83
..-

Total fixed liabihties
Total liabilities-

$150,882, 25
145, 234. 47
38,771,79
2,400,00

610,311.97
5,592.46
13,797,84
751,734.85
2,873. 50
3,021. 65
l, 387,332. 27

2,172, 747,38

In view of the transfer of the purchasing functions of the Division
of Supplj^ to the Procurement Division, the following statement of
expenditures by the Division of Supply for the fiscal year 1934 and
approximately 10 months of the fiscal year 1935 is included in the
report of the Branch of Supply:
1 General fund revenue transferred to miscellaneous receipts during July 1935.

BEPOET OP THE SECBETABY OP THE TEEASUBY

147

Expenditures by Division of Supply for the fiscal year 1934 and 10 months of 1935,
by appropriations ^
B u r e a u s a n d offices, a n d titles of a p p r o p r i a t i o n s
Chief C l e r k a n d S u p e r i n t e n d e n t :
C o n t i n g e n t expenses, T r e a s u r y D e p a r t m e n t
Library
W o r k i n g fund. Civil W o r k s A d m i n i s t r a t i o n
...
National Industrial Recovery, Emergency Council.
Total.
Division of B o o k k e e p i n g a n d W a r r a n t s , contingent expenses, p u b l i c m o n e y s .
B u r e a u of C u s t o m s , collecting t h e r e v e n u e from c u s t o m s
P u b l i c H e a l t h Service:
P a y of personnel a n d m a i n t e n a n c e of hospitals
Q u a r a n t i n e ser vice'..I n t e r s t a t e q u a r a n t i n e service
M a i n t e n a n c e , N a t i o n a l I n s t i t u t e of H e a l t h
N a t i o n a l I n s t i t u t e of H e a l t h , conditional gift fund
.,.
Field investigations
P r e v e n t i n g t h e s p r e a d of epidemic diseases
P r e v e n t i n g t h e spread of epidemic diseases, 256,632 t y p h u s
E x p e n s e s , Division of Venereal Diseases
C o n t r o l of biologic p r o d u c t s . . .
Books
S t u d i e s of r u r a l s a n i t a t i o n
E d u c a t i o n a l exhibits
—
Expenses, Division of M e n t a l H y g i e n e
.
W o r k i n g fund. Civil W o r k s
W o r k i n g fund, Beltsville ( M d . ) p u b l i c works
W o r k i n g capital fund, narcotic farms
W o r k i n g fund. T r e a s u r y D e p a r t m e n t emergency relief
National Industrial Recovery
D e p a r t m e n t of Justice transfers to P u b l i c H e a l t h Service: M e d i c a l a n d
hospital services, penal i n s t i t u t i o n s
Total.
P r o c u r e m e n t Division:
B r a n c h of S u p p l y
P u b l i c W o r k s B r a n c h (account p u b l i c b u i l d i n g s ) :
R e p a i r s a n d preservation
Mechanical e q u i p m e n t - _ J
V a u l t s a n d safes
General expenses
F u r n i t u r e a n d repairs
Operating supplies
Total.
B u r e a u of I n t e r n a l R e v e n u e :
Collecting t h e i n t e r n a l r e v e n u e
A d v a n c e s to Agricultural A d j u s t m e n t A d m i n i s t r a t i o n (transfer to Internal R e v e n u e , a d m i n i s t r a t i v e expenses)
A d m i n i s t r a t i o n of C o t t o n A c t
A d v a n c e s to D e p a r t m e n t of Agriculture u n d e r Tobacco A c t

1934

1936

$105,961. 73
464. 41
140, 514. 76

$48, 935. 39
759. 08
528. 98
17, 588.02

246, 940. 90

67, 811.47

1, 952. 07

3, 616, 05

333, 082, 83

342, 272. 90

1.500, 239. 65
173,112. 84
874,12
33, 899. 80

1,558, 519. 90
95, 772.65
412. 44
29, 580. 00
200, 00
13,425.42
20,184. 75
19.40
3, 636. 40
8, 006. 74
425, 50
271.32
120. 34
238, 382. 00
1,749. 55

17,144. 56
43, Oil. 69
3, 231. 31
12, 991. 30
418. 36
311.33
421. 39
260. 83
44, 750. 45
34.87
78, 266. 39

35,984. 37
1, 487. 30
83, 864. 24

84,144. 35

47,134. 78

1,993,113. 24

2,139,177. 00

8,650.51

5, 069. 08

82, 539. 64
115, 517. 82
10, 433. 68
55, 368. 34
' 478, 797. 68
859,426. 58

108, 059. 85
118, 999.19
3,194. 75
50,000. 00
42, 347. 06
29,183. 01

1, 610, 734. 25

356,852. 94

165,411.51

394,833.80

304,762.81

158,101. 52
360,047. 25
5,134. 05

Total

918,116. 62

B u r e a u of Narcotics, salaries a n d expenses

4,485. 06

14, 321.16

B u r e a u of I n d u s t r i a l Alcohol, salaries a n d expenses

25, 260. 09

P u b l i c D e b t Service:
Expenses of loans (act Sept. 24,1917, as a m e n d e d a n d e x t e n d e d ) . .
P u b l i c D e b t Service

83, 577. 52
14, 732. 22

107, 625. 29
12, 215. 95

98,309. 74

119,841. 24

Division of D i s b u r s e m e n t , salaries a n d expenses

27, 783. 74

52, 337. 64

4,811,^836. 24
559, 502. 21

4,014, 347. 02
517, 640.15

5, 371, 338.45

4, 531,987.17

Total

T o t a l a p p r o p r i a t i o n s a n d allotments
'.
P u r c h a s e s from a p p r o p r i a t i o n s from w h i c h no a l l o t m e n t s were m a d e . .
G r a n d total..

1 I n previous a n n u a l reports this t a b l e w a s s h o w n u n d e r t h e Division of S u p p l y .

148

REPORT OF: THE SECRETARY OF THE TREASURY
Public Works Branch

The functions of the Public Works Branch are to collect and prepare for submission to Congress data and estimates for public building
projects; to acquire land for public building sites; to prepare plans,
specifications, and estimates for public buUding construction and to
take bids and award contracts therefor; to supervise the construe-,
tion, remodeling, extension, etc., of public buUdings; to repair aU
public buildings formerly under control of the Treasury Department,
which were transferred to the custody of the Post Office and Interior
Departments under Executive order of June 10, 1933; and to operate,
repair, equip, and maintain all public buildings in the custody of the
Treasury Department outside of the District of Columbia.
Office oj the Supervising Architect.—During the year an advisory
committee on engineering was established, consisting of 5 consulting
engineers, 2 of whom are specialists in mechanical and electrical
engineering and 3 in structural engineering. This committee was appointed to assist the Supervising Architect in a review of the present
practice and procedure of the engineering departments to determine
any necessary changes with respect to the selection of suitable designs
for buUdings. As a result a Manual of Design in the form of a code
is being prepared to serve as a guide in the development of plans and
specifications for new structures. The committee has also undertaken the solution of special engineering problems assigned to it in
connection with specific buUding projects.
A directive board was established to study the requirements of
each project in its preliminary stage, taking into consideration t h e '
best utUization of the site selected, the general character of the.
design in its broad sense, the selection of the most appropriate materials for construction and finish, the avaUabUity of local materials,
the relationship of the proposed building to its surroundings, and the
development of an equitable balance in the use of materials that wUl
spread the benefits of the public buUding program as much as possible
among all producing industries.
Office oj the Supervising Engineer,—The reorganization of this office,
completed during the year, has resulted in improved coordination of
the work. To facilitate control of the various functions and widely
distributed personnel engaged in field work, the United States and its
immediate territories were divided into eight districts, with headquarters located in a city in each district. Approximately 15,000
persons w^ere employed directly and 100,000 persons indirectly in the
execution of more than 1,500 contracts, ranging from $500 to
$10,000,000.
The facility to make immediate site surveys and soU investigations
at any place-within the United States was perfected during the year.
An important adjunct of the Supervising Engineer's Office is the
activity of an independent corps of special inspection engineers
whose reports represent individual criticism of design, construction,
and personnel. Their suggestions are finding valuable reflection in
the character of design, nature of materials, and methods of construction used in public buildings.
Section oj Painting and Sculpture.—This section was organized on
October 16, 1934, for the purpose of securing suitable paintings and
sculpture for the embellishment of public buildings and to stimulate
the development of art in this country.

REPOET OF THE SECRETARY OF T H E TREASURY

149

The executives of the section are in close touch with the art devel^opments throughout the countrj^ as the result of their work in directing
the former Public Works of Art Project of the Treasury Department.
Under their direction competitions were instituted for national, regional, and State projects. These competitions were open and invited, and it is estimated that about 800 artists participated. During
the year 824 sketches by 352 artists were passed upon by local committees and submitted to the Procurement Division.
During the year the section reviewed 854 public buildings in connection with art projects. Of these, 286 projects were authorized,
121 are still under consideration, and 447 were discarded for lack of
space or insufficient funds.
The section publishes periodically a bulletin containing information
about the projects that are under way and about those which it expects to initiate. During the year 575 photographs of the works of
various artists were added to the large photographic file which had
been transferred to the section from the Public Works of Art Project.
A number of artists were placed in ci^^ilian conservation camps by
the section. In this connection, 100 painters have been placed in
-camps and 3,000 pictures have been received from them.
At the beginning of the fiscal yeax 1936, the section W'Ul be supplemented, by the Treasury Relief Art Project, designed to select from
artists on the relief rolls about 450 painters and sculptors to create
murals and sculptures for public buUdings.
Original public building program.—During the year 124 projects,
with a total limit of cost of $259,565,882, were completed under the
original public buUding program. Of the 735 construction projects
previously under contract, 702, with a total limit of cost of $430,207,564,
were completed by June 30, 1935; and 33 projects, with a total liinit
of cost of $12,792,575, remained under contract.
Program under the Public Works Administration.—The number of
allotments for public buUdings by the Admuiistration of Public Works
under the Nacional Recovery Act, approved June 16, 1933, was reduced during the year from 465 to 442, due chiefly to the fact that the
Post Office Department was able to effect reductions in the cost of
leases of property for post office uses to an extent that rendered the
•construction of proposed new buUdings unnecessary. Additional authorizations increased the total of the allotments during the year
from $67,410,788 to $70,850,768.
The status of work under this program on June 30, 1935, is shown
i n the foUowins: table:
status
Authorized by the Public Works Administration
M1
•'Completed.
Under contract
.
Bids in, on the market, or in specification stage
Drawing stage
>Sites selected and surveys ordered
•Sites advertised for, examined, and awaiting selection.
Total

Number of
Limit of cost ^
projects
442
27
•

$70,850, 768.55

101
17
3
11

2,978,676.36
45,806, 288.19
16, 559, 295. 00
1, 713. 510, 00
779,000. 00
3.014.000.00

442

70,850,768,55

283

1 Includes augmentations from the i J,500,000 fund provided by the Emergency Appropriation Act of
.June 19,1934.

150

REPOET OF THE SECEETAEY OF THE TEEASUEY

The value of contracts awarded both for land and construction and
of certain administrative expenses incident thereto, as of June 30,
1935, was $47,990,207.87, leaving $22,860,560.68 unobligated.
Reliej program.—The Emergency Relief and Construction Act of
1932, approved July 21, 1932, authorized and appropriated $100,000,000 for public buUding projects. Under the act of March 31, 1933,
all moneys previously appropriated for public works, unless obligated
in connection with projects on which actual construction had been
commenced, or might be commenced within 90 days, were allocated
to the conservation program. The following table gives an accounting
to June 30, 1935, of the appropriation for public building projects
under the Emergency Relief and Construction Act:
Appropriated
Transferred to:
Emergency Conservation fund..
Office appropriations
Retained by Public Works Branch
Expended to June 30, 1934....
Obligated but not expended. June 30, 1934

$100,000,000.00
$92,875,200.00
308, 241. 65
.
4,570,792. 52
557, 222. 37
—

Unobligated balance, June 30, 1934
Fiscal year 1935:
Purchase of 9 sites, etc., $185,276.95, from funds obligated but not expended on June 30,
1934 ($557,222.37). Net cancelation of obligations
Unobligated balance, June 30, 1935

93,183,44L65
6.816,558,35
5,128,014.89
1,688,543.46
371,945. 42
2,060,488,88

Emergency construction program.—In the Emergency Appropriation
Act approved June 19, 1934, $65,000,000 was appropriated for the
emergency construction of public buildings outside the District of
Columbia, to be selected by the Secretary of the Treasury and the
Postmaster General from public building projects specified in statements 2 and 3 in House Report 1879, Seventy-third Congress. There
was also authorized the expenditure of $2,500,000 from Public Works
Administration funds for permitting increases up to 10 percent in the
limits of cost of both Public Works Administration and Emergency
Construction projects when the bid of the lowest responsible bidder
exceeds the amount previously made avaUable for any project.
Under this legislation, 355 projects were selected during the year
with a total limit of cost of $65,166,945. The status of work under
this program on June 30, 1935, is shown in the foUowing table:
status

Number of
Limit of cost i
projects

Authorized

355

Completed
Under contract
Bids in, on market, or in specification stage
Drawing stage
..-.
Sites selected and surveys ordered
Sites advertised for, examined, and awaiting selection.

1
160
118
56
3
17

50, 000
22, 901.145
23,131, 500
17, 508, 300
170,000
1,406,000

355

65,166.945

Total

$65,166,945

1 Includes augmentations from the $2,500,000 fund provided by Emergency Appropriation Act of June 19,
1934.
'^

The value of contracts awarded both for land and construction
and the amount of certain administrative expenses incident thereto
as of June 30, 1935, were $25,310,169.86, leaving $39,856,775.14
unobligated.

EEPOET OF T H E SECRETARY OF T H E TREASURY

151

Private architectural services.—Under the authorization by Congress for the employment of private architects to the extent deemed
necessary by the Secretary of the Treasury, contracts had been made
at the end of the fiscal year 1934 with architectural firms for 301
projects. During the fiscal year 1935, 61 additional contracts were
made and 194 of those previously in force were terminated or settled,
leaving 168 contracts in force at the end of the fiscal year 1935.
Administration and cost oj Federal buildings under the control oj
the Treasury Department.—The administration, number, and cost of
completed buildings under the control of the Treasury Department
(exclusive of land) as of June 30, 1935, are shown in the following
table. The control of these buUdings is charged to the Procurement
Division, and repairs thereto are payable from annual appropriations
for repairs to public buUdings.
Buildings administered b y Post Office Department
-Interior Department
--Procurement Division
Procurement Division, Federal buildings (old) which have reverted to custody of the Treasury Department
-...
.1
Bureau ofthe Mint..
Chief Clerk, Treasury Department...
Public Health Service, marine hospitals
1...
Public Health Service, quarantine stations
Total

489,965, 279. 68

1 Includes 20 vacant buildings, 40 old buildings used by emergency relief agencies, 10 old buildings used
by other Government agencies, and 4 old buildings rented for commercial purposes.
2 Includes Public Health Building. Cincinnati, Ohio; Public Health Building, Philadelphia, Pa,; and
National Institute of Health. Washington, D . C .

Expenditures.—Expenditures for aU purposes by the Public Works
Branch during the fiscal year 1935, together with outstanding contract liabUities and unencumbered balances of appropriations, are
shown in the following statement:
Expenditures and contract liabilities charged against appropriations for the fiscal
year 1935, and unencumbered balances as of June SO, 1935
Expenditures

Statutory roll
Sites and additional land
Construction of new buildings
Extension to buildings
Miscellaneous special items
Administrative expenses. Public Works Administration projects
Emergency Appropriation Act, June 19, 1934:
Administrative expenses, emergency construction
projects...
Administrative expenses, emergency repairs projects.
Emergency repairs to pubhc buildings, etc
Unallotted appropriations
Furniture for triangle buildings
Lands and other property of the United States
Repairs and preservations of pubhc buildings
Mechanical equipment for public buildings
Vaults and safes for public buildings
1 Includes $215,000 reserve 1934.
3 Includes $350,000 reserve 1934.
8 Includes $200,000 reserve 1934.
< Includes $254,355 reserve 1934.

$286, 242. 08
6, 998, 371.19
33, 484,105. 71
9, 530, 931.12
725, 516. 21

Contract liabilities charged Unencumbered
June
against appro- balances,
30. 1935
priation
$77.92
10, 052,889. 39
43,909, 556. 53
4, 352, 565. 98
408, 363. 82

1 $286, 313. 53
274,062.50
66, 567,101.98
11,423, 695. 91
257,499. 08

2,952,806.36

506,053. 27

3, 605.119,11

2,010,041.82
100, 620. 62
613, 650. 88

473, 033. 88
"233,'830."70"

3,678, 738. 52
39, 379. 38
552, 518. 42
6,193, 516. 32
102,831.15
350. 00
2 492, 948. 64
3 294,161. 35
4 407, 323,41

280, 082. 95

I, 539. 90

623, 784. 80
528, 561.93
11, 676. 57

208, 646.11
114,148. 81
9, 038.81

152

REPORT OF T H E SECRETARY OF T H E TEEASURY

Expenditures and contract liabilities charged against appropriations for the fiscal
year 1935, and unencumbered balances as of June SO, 1935—Continued

Expenditures

Contract liabilities charged Unencumbered'
June
against appro- balances,
30, 1935
priation

$88,910.34
321.602. 68
687,145. 62
81, 562. 21
490, 682.06
., 209,131.34

Furniture and repairs of same for public buildings.
Operating supplies for public buildings
General expenses for public buildings
Rent of temporary quarters
Outside professional services
Operating force for public buildings
Total

60,925,326.49

$75, 314. 72
262,413.29
37, 622, 63
6,841,16
820,898. 07
10,600.00
61,671,334.99

8 $3,103,949. 26
e 447,606.78
7 1,406,376,15.
8 390.798.86
e 138,920.88'
10 6,799,600.18
95,462,811.41

8 Includes $2,660,043 reserve 1934.
6 Includes $337,231 reserve 1934.
7 Includes $1,043,625 reserve 1934.
8 Includes $388,063 reserve 1934.
»Deficit.
w Includes $2,920,000 reserve, 1934; $6,000,1935.

The foUowing table, pursuant to the act approved June 6, 190D
(31 Stat. 592), shows the total expenditures to June 30, 1935, for all
purposes for buildings constructed by the Treasury Department.
Cumulative expenditures, by types, on each class of public buildings constructed by^
the Treasury Department to June SO, 1935
Construction

Extension, alTotal expenditerations and Annual repairs tures, June 30,
special Items
1936

Post-office, courthouse, customhouse
$172,823,803 08 $36,096,989.97 $21,429.334.18 $229,360,127. 2a
buildings, etc. . .
...
628.583.79
Courthouse buildings
10,438,173 80
602,920, 94
11,669.678.63Customhouse buildings
2. 876, 670 39
24,117.842 94
3,483,632. 55
30 477.045.884,121,077.39
Marine hospital buildings
7,668,368.72
14,483,163 11
26.272,589. 22°
Post-office buildings
14,906,133. 03 13.463. 632. 21 214,739.049 74^
186,369, 284 60
1.930,640, 40
Quarantine-station buildings
3,093,649.15
3,714.605 76
8.702,846. 61
6,520,040.12
Miscellaneous buildings .
134,330, 289. 36 10,306.300.85
151,156 630 33.
Total

546,277,062.54

76,166,986.21

Cost of sites

Post-office, courthouse, customhouse buildings, etc
$47,123, 613. 79
Courthouse buildings
5,339,034.69
3, 886,922.33
Customhouse buildings.-Marine hospital buildings
892,172.53
Post-office buildings...
74,889, 222. 67
Quarantine-station buildings
328, 837. 60
57, 211,127.12
Miscellaneous buildings
Administrative expenses. Public Works
Administration projects i . .
Administrative expenses, emergency construction projects!
Administrative expenses,emergencyrepairs.
Unallotted appropriations
Total.

189,670,830.73

60,968,778.48

672,366,966.64-

Liabilities 'chargeable against Unencumbered balanc
appropriations ^
of appropriations, June
30.1936
Buildings
Sites

$69, 600.00
9,909,096.89
16, 000.00
69, 293.50

$3,491,439. 07 $9, 607, 517.09
2,685,350.96
2,289, 659. 20>
317. 00
784, 158.96
1,171, 265. 04
207, 900.4023,079, 677. 91 35, 244, 696. 80^
670, 028. 78
422, 336. 65
17, 672, 407. 67 20,066, 190.37
3, 605,119.11
3, 678, 738, 52.-:
39, 379. 38
6', 193,616.32-

10,052,889.39

48, 670,486.33

81,039,112.80-

1 Administrative expenses for Public Works Administration projects were 3 16,063,27; and for emergencyconstruction projects, $473,033,88,

153

REPORT OF T H E SECRETARY OF T H E TREASURY

PUBLIC DEBT SERVICE
Division of Loans and Currency
This Division is the active agent of the Secretary of the Treasury for the issue of all public debt obligations of the United States
and for conducting transactions in such obligations after issue. I t
is also responsible for the issue of bonds or other obligations of
Puerto Rico and the Philippine Islands, for which the Treasury
Department acts as fiscal agent. The Division undertakes the safekeeping of public debt and insular loan securities for certain Govermnent offices. I t also counts and delivers to the Destruction Committee the United States currency canceled as unfit and mutilated
paper (spoilage, etc.) received from the Division of Paper Custody
and the Bureau of Engraving and Printing.
Issue and retirement of securities.—The following is a summary
of the issues and retirements of securities conducted through this
Division during the fiscal year 1935. Complete details of all transactions in public debt securities are presented in formal statements
elsewhere in the report.
Issues, retirements, and transactions i/n stock of United States and insular
seourities during the fiscal year 1935
[Par value]
Registered

Nonregistered

Total

ISSUES

Stock shipments:
To Federal Reserve banks:
For exchange transactions
For allotment for original issue
To Postal Service
Issues by the Division:
Original issues
Exchange (all transactions)..

Total issued and shipped

$288,216,250

$5, 238,484,900. 00
1 16, 354, 617,650. 00

$5, 238, 484, 900 00
1 16, 354, 617, 650. 00
288, 216, 250 00

872,281,270
992,830, 750

66,163,460.00
121, 587,000. 00

938,444, 730. 00
1,114,417, 750. 00

2,153,328, 270

21, 780, 853, 010. 00

23, 934,181, 280. 00

639, 841, 690
999, 033, 935

474, 576, 060. 00
1,124, 238. 25

1,114,417, 750. 00
1, 000,158,173. 25

RETIREMENTS

Retired on exchange.
Cleared for redemption
Retired on other accounts (i. e., claims, credit
and exchange authorization retirements)
Total retired...

:.:

504, 860,925

33, 090. 00

.504,894,015.00

2,143,736,550

475, 733; 388. 25

2, 619,'469;'938, 25

2, 625,402, 360

26,167, 086, 000. 00

28. 792,488, 360. 00

37, 642,840

764, 654, 200. 00

802, 297, 040. 00

STOCK ACTIVITIES

Received from Bureau of Engraving and Printing
Canceled and delivered to Register of Treasury:
Securities
Detached matured coupons (4,620,943
pieces—amount $336,250,385.10).

1 Includes Treasury bills available for either original issue or exchange in the amount of $5,771,148,000.

United States Savings Bonds.—During the year the Division received from the Bureau of Engraving and Printing 2,920,000 United
States Savings Bonds with a maturity value of $413,750,000. Of
these bonds 1,343,750, with a maturity value of $288,216,250, were
delivered to the post offices, leaving a balance on hand of 1,576,250
bonds with a maturity value of $125,533,750. Sales and redemptions

154

EEPOET OF THE SECEETAEY OP THE TEEASURY

of these bonds, monthly, since the first month of issue are shown in
the following table:
Sales and redemptions of United States Savings Bonds, monthly, March to
June 1935
N u m b e r of pieces, b y d e n o m i n a t i o n
Month

$25

$50

52,079
23,837
16,879
15,193

33,455
17,197
13, 039
11, 892

Maturity
yalue

Sale price

$100 1 $500 1 $1,000 1 total
Sales

March
April..
May
June.

. _

107, 988

Total

74,873
43, 366
31, 046
28,131

27,153
16, 021
11, 622
9, 914

27, 713
17,912
13, 807
12, 480

215,
118,
86,
p,

273 $38, 813, 643
333 23,786,156
393 17, 847, 393
610 15,918,393

75, 583 177,416

64,710

71,912

4b7, 609

75 $51,751, 525
25 31, 714, 875
75 23, 796, 525
75 21, 224, 525

96, 365, 587 50 128, 487,450

R e d e m p t i o n s prior to m a t u r i t y
May
June

.
Total

. .
. .

405
911

158
537

344
958

82
256

136
205

1,125
2,867

$172, 068. 75
358, 818. 75

$229. 425
478,425

1,316

695

1, 302

338

341

3,992

530, 887. 50

707, 850

Individual registered accounts.—^In connectid n with registered, publie debt issues, individual accounts are maimtained and interest is
paid periodically in the form of checks, The interest-bearing
accounts open on J u n e 30, 1935, w;ere as follow^
Number of
accounts
Interest^bearing loans:
Pre-war loans
Liberty bonds
Treasury bonds
Treasury notes and certificates of indebtedness..
Total interest-bearing loans

Principal

40,910
159,947
418, 484
18

$823, 340.430
185, 571, 350
1, 976, 373, 350
633, 242,000

619, 359

3,618, 527,130

There were 394,004 individual accounts closled for registered Liberty bonds, Victory notes, special Treasury noiles,, pre-war issues and
Treasury bonds, and 178,234 accounts were dlecreased, representing
the retirement of securities amounting to $1,|^98,416,180 par value.
I n connection with the same loans 234,704 new accounts amounting
to $3,069,160,170 principal were opened. A total of 40.631 changes
of address were made on the registered accouults during the year.
Interest on registered Liberty and Treasury bonds was paid on due
dates in the form of 1,521,751 checks amounj ing to $92,586,157.19.
On registered securities of the pre-war loans $4,955 checks for $17,192,699.25 w^ere issued and on registered Treasury notes and certificates of indebtedness interest payable by f ^ur checks amounting
to $17,062,984.61 was certified to the Treasurer, There were received from the Bureau of Engraving and Printin,g 1,788,300 checks
as stock and there was canceled arid delivered to the Destruction
Committee stock consisting of 264,848 valid checks and 16,483 void
checks.
Claims.—Claims for relief on account of lost, stolen, destroyed, and
mutilated securities handled by the Division Iduring the fiscal year
were as follows:

155

EEPOBT OF T H E SECBETABY OP T H E TEEASUBY
N u m b e r of N u m b e r of
claims
securities
O n h a n d J u n e 30, 1934.^
Received
Total-

.
-.

Settled b y Reissue or r e d e m p t i o n of securities
R e c o v e r y of"securities
Disallowance of claims
. .
O t h e r disposition i

...

.
.
•
. . . .

T o t a l settled
B a l a n c e on h a n d Tune 30, 1935

Par amount
of securities.

8,710
2,736

25,887
6,594

$3, 945, 783. 26
1, 374,029. 29

11, 446

32,481

5, 319,812. 54

1,798
1,051
30
172

4,131
1,696
43
658

629, 654. 04
843,815. 00
7, 200. 00
3, 242. 50

3,051

6, 528

1, 383, 911. 64

8, 395

25, 953

3, 935, 901.00

1 War savings cases sent to Surrenders Section for settlement because of question of ownership.

Safe-keeping of securities.—At the beginning of the year securities amounting to $414,770,750 were in safe-^keeping for various Government offices, against which formal audited receipts were outstanding. Throughout the year securities amounting to $314,867,150^ were
received for safe-keeping and receipts therefor issued, and securities amounting to $267,937,150 were delivered from safe-keeping
upon the surrender of outstanding receipts, leaving a balance of
securities amounting to $461,700,750 in safe-keeping June 30,. 1935.
Mutilaited pnper and redeemed currency.—Mutilated paper verified and delivered to the Destruction Committee consisted of 129,938,825 sheets and coupons, of which 129,643,811 sheets and coupons
Avere received from the Bureau of Engraving and Printing and
295,014 sheets from, the Division of Paper Custody.
Redeemed currency,, unfit for circulation, counted and delivered to
the Destruction Committee during the year amounted to 654,174,295
pieces, representing $1,4035473,867.33, detailed as follows:
Number of pieces and amount of redieemed eu/rrency delivered to the Destruction
Committee duri/ng the fiscal year 1935
Old series
Currency
United States notes
Si 1 ver certificates:.......
Silver certificates, 1928^.
Silver certificates, 1933..
Silver certificates. 1934..
Gold certificates
^..
Treasury notes...-..
Fractional currency....
Total..

Number of,
pieces

Face value

678. 202
1.404, 316

$1, 855, 749. 00
1, 725,,424. 00

329, 818
1,571
8.635

7.183, 710. 00
7. 650. 00
1, 973. 33

2, 322, 542

10.774, 606. 33

New series
Nuniber of
pieces

Face value

69,097. 623

$244. 916. 461

632, 061, 202
144, 628
39, 732, 862
20, 815, 538

632, 055, 918
1,446, 280
76, 509. 372
637. 771.340

651,851, 753

1, 392.699. 361

156

REPOET' OF THE SECEETAEY OF T H E TEEASURY

Publicity.—The Division maintains a mar ing list, in addition.
to its list of holders of registered securities], for the purpose of
placing new public debt offerings, notices of tedemption, and such
matters before the public. Approximately 3,1323,300 printed circulars were distributed to the public during the year.
Other activities.—In addition to the r^egular activities of the
Division, securities of various Government ihstrumentalities were
received from the Bureau of Engraving and Er:inting and issued as
follows:
Securities of Government instrumentalities received cmd issued, fiscal year 1935
On h a n d J u n e 30, 1935

Issued

Received
Securities

Pieces

Par amount

Pieces

129.000
6.882.700

$860.000,000
7.001.450.000

19,806
4. 536,876

264.000
130.674
741.325 3.062,999

$662,829,000
3,089. 722, 625

7.011.700

7,861, 450, 000

4, 556, 682

005.326 3i 193,673

3,742, 551, 625

Federal Farm Mortgage
Corporation:
58,037
Registered
Coupon
-. 1.965,000

729, 875,000
1,797,600,000

67,799
1,620,050

371 724.900
1.417 401.600

39,788
377,674

678,806,000
414,476,700

2,023, 037

2, 627, 475, 000

1,687,849

1.789 126. 600

417,462

1,093. 282, 700

25, 000
460, 000

66, 220,000
833, 400, 000

4,615
319.235

11 721.100
537 039,000

20, 284
141, 992

54,026,400
297, 476,000

485, 000

899, 620, 000

323, 850

162, 276

351, 502, 400

3,850

358, 250, 000

1,981

9, 623, 587 11,646, 795,000

6.570. 362

Home Owners'
Corporation:
Registered
Coupon

Par amount

Pieces

Par amount

Loan

Total

Total
Consolidated Federal
farm loan bonds of the
Federal land banks:
Registered
Coupon
Total
Reconstruction Finance
Corporation:
Coupon
Grand total

21,911

1, 722,820, 500

6.946 541.925 3.795.322

6, 910,167. 226

108 660, 000

Register of the Treasury
The Register of the Treasury conducts th| final audit and has
custody of all retired public debt securitij , including interest
coupons and checks; and, in addition, he perfor:ms a like function
with respect to the securities of the Home Ojwners ' Loan Corporation and the Federal Farm Mortgage Corporjition the consolidated
obligations of the Federal land banks, and bqnds of insular possessions retired on account of exchanges for omer securities,
The Register renders monthly certificatioli to the Comptroller
General of all public debt securities redeemed by the Treasurer of
the United States and establishes credits du4 the Federal Reserve
banks and the Division of Loans and Currejicy for securities forwarded by them on account of exchanges, rleplacements, transfers
of registration, etc.

157

BEPOET OP T H E SECBETABY OF T H E TEEASTJEY

The following statement sets forth, by class of security, the total
number of documents, together with the face value thereof, which
were received, examined, and filed during the fiscal year 1935:
S u m m a r y of securities retired, fiscal year 1935
Registered

Bearer
Security

Pieces .

Amount

Pieces

Amount

Redeemed
United States securities:
Pre-war loans
Libertyloans
Treasury bonds
Treasury notes
Certificates of indebtedness
Treasury bills
Treasury (war) savings securities
United States Savings Bonds
Interest coupons...
Interest checks
.--.
other securities:
Home Owners' Loan Corporation:
Securities
Interest coupons.
Interest checks
Federal Farm Mortgage Corporation:
Interest coupons...
Interest checks
Consolidated Federal farm loan:
Interest coupons
Interest checks
Total..

$18.620.00
2,699
4,081,411,250.00 667,921
565,000.00
1,302,1646,700.00
131
1,622,'470,300. 00
81
3.326. 590,000.00
6
149.081.40
5,499
3,992
14, 111, 643
545, 285,169,92
169
3,164.411
60
63,813
63,137
61,067
112,898

133, 422
5,760,689

242,016,200.00
60,080,571. 60

1,531.769

20,116, 726.00

89,751

2,477, 212. 00

$1,782.210,00
785.397.200,00
32.973, 000.00
176.900.000. 00
126,434.18
630.887. 50
7.43

608

3.197.000.00

7,108

4.634,923.75

17,626

6.608,858.80

""'719'

'"'ii8,'880.'o5

26.082,829 11,103,816,829.82 706,385 1.010.169.401,
Retired on account of exchanges for other securities,
etc.

United States securities:
$867,860.00 47,099
2,582
Pre-war loans
698,748,950.00 98,941
484,356
Liberty loans..
—
347, 276 1. 517.350, 250. 00 67,832
Treasury b.onds
1
273,005 4, 724, 796,450. 00
6
Treasury notes..
331, 647.500. 00
14,913
6
Certificates of indebtedness
863,421,000.00
7,115
Treasury bihs
. First 33^ percent Liberty loan interim cer1.000.00
tificates
16
Other securities:
3,000.00
3
2,193
Insular possessions loans..^
Home Owners' Loan Corporation securities... 3.052.833 1.414,828, 525. 00 6,249
Federal Farm Mortgage Corporation secur871.490
402, 296, 200. 00 7.805
ities
21, 738, 500.00
14,139
146
Consolidated Federal farm loan securities
Total..

5,067,727

9.875. 599, 235. 00

$356. 095.640. 00
213, 566,900. 00
441, 572,300. 00
124,195, 000. 00
5,000,000. 00

4,234,000. 00
54,847, 650.00
239.716^*300.00
421,400. 00
1.439. 642,990. 00

158

REPORT OF THE SECRETAEY OF THiJ TEEASUEY
Summary of securities retired, fiscal year 1935:—Continued
Bearer

Security

Pieces

Registered

Amount

Pieces

Amount

Unissiu e d stock r e t i r e d

U n i t e d S t a t e s securities:
P r e - w a r loans
Libertyloans
Treasury bonds
T r e a s u r y notes
Certificates of i n d e b t e d n e s s .
T r e a s u r y bills
I n t e r e s t coupons
O t h e r securities:
I n s u l a r possessions loans
H o m e Owners' Loan Corporation:
Securities
Interest coupons
Federal F a r m Mortgage Corporation:
Securities
I n t e r e s t coupons
Consolidated F e d e r a l farm loan:
Securities
I n t e r e s t coupons

107.730
8
132, 376
132, 593
19,025
i, 281,082

Total..

$462, 26a
2m
609,339
825, 74a
983,378
463, 615

200. 00
550. 00
100. 00
000. 00
000. 00
237. 83

17, 080
2,045
2, 323

$2, 774. 240. 00
2,867,400. 00
6,369, 200. 00

3,690

25, 632, 000. 00

1,309
710, 773

1, 503 375. 00
37, 737 361. 89

106

521, 000. 00

3,583
439, 424

4,0l4 600. 00
9, oni 367. 80

27,327

111, 828,800. 00

101

472, 500. 00

20, 781

835 204. 00

6,848, 684

3, 297, 669 996. 52

52, 672

150,465,140, 00

Recapitulation

U n i t e d S t a t e s securities:
Pre-war l o a n s —
Liberty l o a n s —
Treasury b o n d s . .
"
T r e a s u r y notes
Certificates o f i n d e b t e d n e s s
T r e a s u r y bills
T r e a s u r y (war) savings securities
U n i t e d States Savings B o n d s
F i r s t ZH p e r c e n t L i b e r t y loan i n t e r i m certificates..
Interest c o u p o n s —
I n t e r e s t checks
O t h e r securities:
I n s u l a r possessions loans
H o m e Owners' Loan Corporation:
Securities
--Interest coupons...
I n t e r e s t checks
Federal F a r m Mortgage Corporation:
Securities
'. 'Interest coupons
-.
Interest c h e c k s . . .
Consolidated F e d e r a l farm loan:
Securities
I n t e r e s t coupons
I n t e r e s t checks
Total

2,761
!, 756,497
347, 344
469,194
210, 643
77, 207
112,898

$360, 651, 990. 00
$880, 480. 00
5.142,426,1,400.00 768,907 1,001,831,500.00
1,518, 122, 800. 00 70,155
447, 941, 500. OO
6, 636, 7 8 i 250. 00
137
157,168, 000. 00
2, 679, 764 800. 00
. 180,900,000.00
5,173,389 000. 00
14a 081.40
5,499
126, 434. 18
3,992
530,887. 50

15
1,392,725

1 000.00
1.008,900 407. 75
000.00

1,187, 664
i, 471-, 462

1,658, 348 100.00
97,817 933. 39

875, 073
1., 971,193

406. 310 800.00
29,134 092.80

14,139
110. 632

21, 738 500.00
3 , 3 i a 416. 00

..36,999,240

7.43

6,883

29, 866,000. 00

6,963

58; 665, 550. Oa

7,108

4,534,923.75

35,132

351, 539,100. 00'

17, 625

6,608,858.80

247

893,900.00

'"7i9'

""ii8,"880'00

24,277,086 061.34 989,333

2,600,277,531.66

N O T E , — R e d e e m e d figures i n c l u d e u n a u d i t e d receipts for M a y a n d J u h e s e t t l e m e n t s , w i t h exception of
Interest c o u p o n s , t h e J u n e s e t t l e m e n t of w h i c h h a s not b e e n r e c e i v e d .

Division of Public Debt Accounts and Audit
This Division maintains administrative conltrol accounts for all
official transactions in the public debt conducted by the various
Treasury offices and the Federal Reserve banlks as fiscal agents of
paper used for
the United States, and also for transactions involving
i
printing public debt and other securities, United States currency,
stamps, etc., and miscellaneous securities and (documents in the Bureau of Engraving and Printing. Numerous administrative audit
functions are performed in connection with the foregoing. The

REPOET OF THE SECEETAEY OF THE TEEASUEY

159

Division also maintains control accounts for various classes of unissued currency in reserve stocks of the Treasurer of the United States
and the Comptroller of the Currency, and conducts administrative
examinations and physical audits of such unissued stocks of currency
and of cash balances in custody, and collateral securities held in
trust in the offices of the Treasurer of the United States.
During the fiscal year, 79 physical audits were conducted, involving securities, currency, paper, interest checks, etc., amounting to
over $53,000,000,000 in face value and 86,000,000 in number of pieces.
The Division determined and certified credits to the cumulative
sinlring fund and amounts in the sinking fund available for expenditure from time to time, interest on all classes 'of public debt securities
which became due and payable on their respective interest-payment
dates, a n i the amount of each form of public debt securities and
unpaid interest .outstanding each month. I t prepared estimates of
interest to become payable on public debt securities in future fiscal
years, and of expenditures to be made on account of retirements for
the sinking fund and other special accounts, and prepared statements showing the accountability of Federal Reserve banks for
public debt securities for the use of Federal Reserve Board examiners in their periodical examinations of those banks. Numerous
data pertaining to public debt transactions for various interested
offices and individuals were also compiled.
During the fiscal year the personnel of this Division increased
from 111 to 210 employees. The additional personnel was necessary
on account of the greatly increased activities of the Division in connection with transactions involving various issues of bonds of the
Home Owners' Loan Corporation and the Federal Farm Mortgage
Corporation, and of consolidated Federal farm loan bonds of the
Federal land banks.
Division of Paper Custody
A summary of the operations of the Division of Paper Custody
during the fiscal year 1935 is presented in the following tables:
Receipts and issues of distinctive and nondistinctive paper during the fiscal year
1935

Kind

On hand
July 1,
1934

Receipts

Issues

On hand
June 30,
1936

Sheets
Distinctive paper for United States currency, Federal
Reserve notes. Federal Reserve ;bank .notes, and
national bank currency, 12 subjects
United States bond paper...
Parchment, artificial parchment, and parchment deed
paper
Miscellaneous paper
Distinctive paper for Cuban currency
Distinctive paper for Philippine Islands currency
Postal card for Philippine Islands
Total-.

18,076,923 1 58, 935, 573 66, 948, 248
6, 269,116 I 17,912, 680 17, 669, 051
148, 271
616,146
483, 426
873
24, 594, 756

177, 755
290, 700
750, 900

205,160
. 331,887
611, 466
483, 250
93, 013

120,866
674, 969
239, 434
176
19,844

78,179, 692 76,142, 075

26, 632, 272

111, 984

» 2.844.923 sheets transferred from United States currency paper to bond paper account.
16816—36
12

20, 064, 248
6, 612, 745

160

REPORT OP T H E SECRETARY OP T H E TREASURY

•Federal Reserve notes, series 1928 cmd series 1934, received and issued durvng
the fiscal year 1935
[000 omitted]
Federal Reserve notes, series
19341

Federal Reserve notes, series 1928
Federal Reserve bank

Boston
ISTew York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
;St, Louis.Minneapolis .
JSiansas City
Dallas
"San Francisco

Total

On hand
July 1, Received
1934

Issued

$354,680
303,760
410,680
421, 540
239,440
205,880
740,360
139,680
121.300
181.300
178.180
220,460

$21,720
172,080
46,860
37,680
19,080
8,880
67, 260
16,920
26,620
14, 760

$76,480 $299.920
113,160 362.680
70,000
387. 640
87,840
371, 380
72, 200 186,320
39, 640 176.120
126, 240 681.380
60, 700 105.800
27,360
119.660
31, 640 164. 520
17, 200 160.980
61,000
169,460

$53.760
279.600 $168,000
47.620
8,040
46,960
2,400
75,060
43, 660
4,900
27, 640
6,000

$63,760
121, 600
47,520
8,040
45,960
2.400
75.060
38.660
27. 540
6.000

3, 617,160

430,860

773.360 3.174. 660

589,440

426. 540

On hand
June 30, Received ,Issued
1935

On hand
June 30,
1935

162,900

1 None on hand July 1,1934.

There were no transactions in Federal Reserve bank notes, series
1929, during the year, the amount on hand remaining at $450,800,000.
Destruction Committee
The following table summarizes the number of pieces and the face
amount of securities received from the various offices and destroyed
•by the Destruction Committee during the fiscal year 1935:
Pieces >
.Division of Loans and Currency and Treasurer of the United States:
New series:
United States notes.
Silver certificates. _
Gold certificates _
.
Silver certificates (act of 1933)
Silver certificates (act of 1934)
Old series:
United States notes
Silver certificates
Gold certificates
Treasury notes
Fractional notes .

59,057, 793
532, 453, 702
21. 547. 564
144,228
39.202,962

$244, 658, 551.00
532,448, 418.00
651, 491,840.00
1,442, 280.00
75,161.222.00
fico

1,821,049.00
1,689,224.00
7,183,710. 00
7,650.00
1,973.33
OOI

COC

654,687, 775

Total

A n c CtA(\

566,695
1, 374,807
329,818
1.571
8,635
o

'Comptroller of the Currency and national
bank agents:
New series:
National bank notes (5 percent account). . . .
National bank notes (retired)
Unissued vault stock
Old series:
National bank notes (5 percent account)
. . . . ..
National bank notes (retired)
Federal Reserve bank notes (retired)

Face value

10,703,606.33
1, 415,905,917.33

29, 418, 303
22, 386, 553
1,190,188

242, 289.457. 50
190, 068, 575.00
11, 617, 965.00

146,523
213,871
28, 571

1,891,140.00
2, 693, 655.00
52, 640.00

443,975,997.60

noe

4,637,435.00

53, 384,009

448,613,432.50

OOO

'I All currency under the head of "Pieces" is expressed In whole notes.

n , 405,202,311.00

161

EEPOBT OP T H E SECBETABY OF T H B TEEASTJEY

Pieces
Comptroller of t h e C u r r e n c y a n d Federal
- Reserve b a n k agents:
F e d e r a l Reserve notes (new series)
121,809,226
Federal Reserve notes (old series)
987,654
Federal Reserve b a n k notes (new series).
6,760,376

Face value

$1,168,077, 705.00
17, 210,250.00
60,670, 500.00
129,657,256
• $1, 245,958,455.00

Internal Revenue Bureau:
Miscellaneous s t a m p s from S t a m p D i v i .sion
Miscellaneous s t a m p s from S t a m p D i vision ("obsolete a n d s u r p l u s " )
S t a m p Division (cotton bale tags)
Miscellaneous s t a m p s from Tobacco D i vision..
Sales T a x Division
Alcohol T a x U n i t
Silver T a x U n i t .
Processing T a x U n i t
,

45,068,828.09
108,809, 743.97
56,260
1,024, 561.83
89, 799.11
46,274.44
2, 606.89
5,049.95
155,046,864,28
56, 260

Begister of t h e T r e a s u r y :
I n t e r e s t coupons, unissued
I n t e r e s t c o u p o n s , unissued F e d e r a l R e ^ .<;erve:bank
C o u p o n b o n d s a n d notes, F e d e r a l R e serve b a n k (unissued)
Bearer certificates of indebtednevSS (unissued)
B e a r e r T r e a s u r y bills (unissued)
Registered T r e a s u r y savings certificates
(unissued)...
T h r i f t s t a m p s (redeemed)
Registered war-savings s t a m p s (redeemed)
Nonregistered war-savings s t a m p s (redeemed)
T r e a s u r y savings s t a m p s ( r e d e e m e d ) . . . .
F e d e r a l farm loan b o n d s a n d c o u p o n s . . .

9,234,474

283,302,304.24

454,357

36,263,041.32

154,223

746,106,550.00

276,417
163.591

1,818,238,000.00
10.295, 733.000.00

37.824
1.019, 667

10,298,400,00
254,914,25

7,469

37,336.62

226.140
3,640
148,373

1,035,448. 42
3, 640. 00
203,418,797.91
11,726,165

13,394,689.432.76

367

P u b l i c ^ D e b t Service, p h o t o s t a t s .
D i v i s i o n of L o a n s a n d C u r r e n c y , Security
Section, inteiest checks

284,481
849.696,313

Grand total-

16,660,214,101. 87

Sheets
Division of L o a n s a n d C u r r e n c y ( B u r e a u of
E n g r a v i n g and P r i n t i n g spoilage):
M o n e y of all k i n d s
Postage s t a m p s
_
I n t e r n a l revenue s t a m p s
B o n d s and certificates of i n d e b t e d n e s s . . .
C u s t o m s a n d miscellaneous s t a m p s
Postal savings certificates
E x p e r i m e n t a l , security p a p e r
Cuban currency... Void c o u p o n s .

Coupons

1,924,800'Ma
7,938,914591 %800
3, 500,85811^04
1,950,61511/12
2,141, 6904^0
254,822
2,707
35,296^
111, 894.109
17,749,706i297%o400

Division of L o a n s a n d C u r r e n c y (Division
of P a p e r C u s t o d y ) :
B o n d paper
C u b a n currency

295,007
7

295,014
18,044,7201297^^0400

Grand total-

111,894,109

PUBLIC HEALTH SERVICE

Division of Sanitary Reports and Statistics
Health conditions in the United States, as revealed by mortality
statistics, were good during the calendar year 1934. The preliminary
mortality rate for 28 States was 10.9 per 1,000 population, as compared
with 10.5 in 1933, the lowest ever recorded for these States.

162

EEPOET OF THE" SECEETAEY OF THE TEEASUEY

An outbreak of poliomyelitis (infantile paralysis) occurred in
California in May 1934 and spread over most of the Pacific Coast
States and into Nevada, Arizona, Montana, and Idaho. I n May
1935 an outbreak occurred in the northeastern part of North Carolina,
not including the coast section, and spread into southeastern Virginia.
After the close of the fiscal year, increases in the prevalence of poliomyelitis were reported in New York, several of the New England
States, and other parts of the country.
The work of collecting information concerning outbreaks of diseases dangerous to the public health and the current prevalence of
these diseases was continued throughout the fiscal year. The data
were made available to pnblic health officers and other sanitarians
throughout the United States by publication in the weekly Public
Health Reports and by special bulletins. A total of 230,921 copies of
publications was distributed as compared with 179,370 in the preceding fiscal year.
Division of Foreign and Insular Quarantine
Quarantine transactions.—During the fiscal 3^ear, quarantine officers of the Public Health Service inspected 15,262 vessels and
1,924,556 persons, as shown in the following table:
Inspections by quarantine officers durimg the fiscal year 1935
Vessels
Ports in continental United States
Insular ports.
Foreign ports, prior to embarkation
Total -

Passengers

Seamen

12,482
2,612
168

644,255
133,149
43,860

981, 361
219,852
2,079

16,262

721, 264

1,203,292

Of a total of 4,081 airplanes, carrying 34,135 persons, which
arrived at 57 airports of entry in the United States from foreign
countries requiring quarantine inspection, only 2,636 airplanes,
carrying 30,249 persons, of whom 1,991 were aliens, were inspected
by medical officers of the Public Health Service prior to entry, due
to arrivals at airports of entry at which medical officers are not
available.
Fumigations were made of 1,147 vessels either for the destruction of rats or because of some contagious disease. Examinations
for plague infection were made of 4,207 of the 5,951 rats retrieved
following fumigation.
No importation of a quarantinable disease into the United States
or its possessions occurred during the year.
The International Sanitary Convention for Aerial Navigation,
opened for signature at The Hague on April 12, 1933, and signed
on behalf of the United States on April 6, 1934, was ratified by the
United States on June 13, 1935, and will become effective on November 22, 1935. Twelve nations had ratified the convention at the close
of the fiscal year.
At the suggestion of the Public Health Service, the Consular Regulations of the United States were amended to authorize American

EEPOET OF THE SECRETARY OP THE TEEASURY

163

consular officers in foreign ports to authenticate, at ports of issuance,
foreign certificates of deratization exemption as well as foreign certificates of deratization issued under the provisions of article 28 of
the International Sanitary Convention of Paris (1926 revision).
The Public Health Service has recommended favorable consideration on the part of the United States of a proposal submitted by the
International Office of Public Health at Paris to amend article 25
of the International Sanitary Convention of Paris (1926 revision)
so as to permit under special circumstances the fumigation of a vessel arriving from plague-infected ports before or during the unloading of its cargo and also to permit a repetition of such fumigation
if necessary to complete deratization of the vessel.
At the request of the Quarantine Service of Habana, Cuba, the
Public Health Service discontinued its routine supervision of maritime fumigations performed by officers of the Port Quarantine Service of Cuba for deratization purposes on vessels in Cuban ports destined to proceed to United States ports.
Medical examination of aliens.—Medical officers at the various
ports of entry in the United States examined 730,777 alien passengers
and 696,562 alien seamen. Of these numbers, 14,569 passengers and
1,250 seamen were certified to the proper immigration officials, in
accordance with the act of February 5, 1917, as being afflicted with
some mental or physical defect or disease.
At the request of the Commissioner General of Immigration .aiid
Naturalization, medical officers of the Public Health Service were
authorized, upon request of immigration officials, to make physical
examinations, in accordance with the standards set forth by the
United States Civil Service Commission, of nominees tentatively
selected by immigration officials for appointment to the position of
immigration patrol inspector.
Because of the high mortality rate from malaria now existing
in the southern part of Texas, and in an effort to restrict the introduction of malaria into the IJnited States from Mexican territory,
medical officers of the Public Health Service on duty at TexasMexican border stations were directed, in cooperation with the State
Health Officer of Texas, to make a microscopic examination of the
blood of any arriving person suspected of having malaria, and to
notify, the Texas State Health Department of the name and destination of persons with malaria released for entry into the United
States.
Examination of prospective immigrants aibroad.—A total of 35,978
applicants for immigration visas was examined by medical officers
in American consulates in foreign countries. Of this number 23,868
were examined in Europe and the remainder in the Western Hemisphere. Of those examined, 574 in Europe and 130 in the Western
Hemisphere were reported by the medical officers to the American
consuls as having one or more of the defects or diseases requiring
exclusion; and 4,745 in Europe and 1,443 in the Western Hemisphere
were reported as being afflicted with a disease or condition which
was likely to affect their ability to earn a living. Only two of the
aliens examined in foreign countries to whom visas had been issued
were certified upon arrival at United States ports as being afflicted
with a defect or disease requiring deportation.

164

EEPOET OF THE SECEETAEY OF THE TEEASURY
Division of Domestic Quarantine

Through the use of a special fund of $1,000,000 made available
by the Federal Emergency'' Relief Administration it was possible
for the Public Health Service to resume cooperative financial assistance to rural health organizations, both in reenforcing the personnel in existing county organizations and in establishing such units
in counties not theretofore so provided. I n 1934 there were 540whole-time county or other local rural unit health services, representing a gain of 10 over the preceding year.
Trachoma-prevention activities in cooperation with the States were
continued in Missouri, Kentucky, and Tennessee, 4,057 persons having beeri examined to determine the presence of the disease. I n the
field clinics and dispensaries, 1,933 treatments were given, while 704
patients were admitted to hospitals.
Plague-control measures were continued in California and on theIsland of Maui, Hawaii, where trapping and poisoning of rats, as
well as experimental work on control procedure, were conducted a&
a part of the program previously inaugurated. No human case of
plague was reported in California during the year, but rodent plague
in ground squirrels was reported in San Luis Obispo, Modoc, and
Lassen Counties. Because of a human case of plague in Lake
County, Oreg., at the beginning of the fiscal year, investigations
were made through the use of a new mobile field laboratory, as a
result of which two foci of rodent plague infection were found in
Oregon and Montana. Extermination of rats by ship fumigation
was continued in San Francisco but no infection was discovered.
I n order to determine the efficiency of State control over sanitation of the shellfish industry in interstate commerce, surveys and
inspections of shellfish-growing areas were continued. A total of
1,915 State certifications was approved during the year.
Approximately 45 percent of the time of the sanitary engineering:
field force was spent in assisting other Federal agencies in the
solution of various sanitation problems. This represents a considerable increase over the volume of service rendered in previous
years, due in part to allotments from the Public Works Administra-^
tion to these Federal agencies for public works projects. I n addition to the engineering services given the National P a r k Service
and the Bureau of Indian Affairs, cooperative assistance was also^
afforded the Public Works Branch of the Procurement Division, the
Bureau of Prisons, the Lighthouse Service, and others.
With the cooperation of State health agencies, the certification
of sources of water used by interstate raUroads, busses, vessels, and
airplanes was continued. Of 2,269 water supplies used by interstate carriers, 95 percent were inspected and certified. Of vessels
engaged in interstate traffic, 51 percent were reinspected and given
certificates indicating compliance with the regulations governing
drinking-water systems.
The study of pollution of the Hampton Roads area in the lower
Chesapeake Bay, undertaken with funds allotted by the Public Works
Administration, was closed at the end of the fiscal year. Assistance
was also rendered a number of States engaged in stream pollution
investigations.

EEPORT OF THE SECRETARY OP THE TREASURY

165

An outstanding activity was the use of work-relief labor made
available by the Federal Emergency Relief Administration on public health projects. Sanitary outdoor toilets were constructed inrural districts, malaria control drainage projects were carried out,
and abandoned mines were sealed to prevent the pollution of streams
by acid wastes. A project for the control of endemic typhus fever
consisted in rat-flea surveys, rat'extermination, and the promotion
of rat-proofing of buildings.
Division of Scientific Research
The program of cancer research was continued during the year.
The investigations pursued at the Office of Cancer Investigations
located at the Harvard Medical School, Boston, Mass., included
studies of the biological effects of radiation, resistance and susceptibility to malignant growths, and biochemical and cytological studies.
A t the National Institute of Health, cancer research included an
investigation of the effects of certain chemical agents upon the various phases of mitosis in A^noeba proteus^ a continuation of the study
of growth of the Walker 256 rat mammary carcinoma in vivo and in
tissue culture, and an attempt to influence the growth of a spontaneous mammary tumor of the mouse.
Heart disease investigations dealt with the geographical distribution of the etiological types of heart disease in the United States, the
methods of reporting, recording, and statistically presenting heart
disease mortality, the epidemiology of rheumatic heart disease in a
locality, and the etiology of rheumatic heart disease.
Clinical observations of leprosy were directed toward the development of better criteria for the diagnosis of cases in the early stages
of the disease, including determination of the significance of a positive Wassermann or Kahn test in differentiating leprosy from
syphilis, the administration of a heterologous antigen to produce a
mild fever and leukocytosis, and the administration of small doses
of colloidal and soluble bismuth preparations to stimulate acute
progressions with succeeding regressions.
As a result of studies of malaria control by means of the drugs
atabrine and plasmochin, it was concluded that drug treatment does
not control the malaria rate in the tropics, although it does improve
the general health of the population and its capacity to work.
During the year seven different foodstuffs were tested for their
pellagra-preventive value by animal experimentation. Rabbit meat,
lean pork shoulder, and chicken were found to be good sources of the
pellagra-preventive vitamin; cottonseed meal and evaporated peaches
to be relatively poor sources of the vitamin; and prunes and canned
beets to contain little or none of the pellagra-preventive vitamin.
The net usable production of Rocky Mountain spotted fever
vaccine was 248.4 liters, an increase of 36.6 liters over the 1934 production. This amount was sufficient for the immunization of about
60,000 persons. Cases of spotted fever were reported for the first
time from the States of Illinois and Oklahoma, making a total of
34 States in which spotted fever is known to be endemic.
Child hygiene activities have been related to a study of the hearing of school children, studies of physical status, growth, and de-

166

REPOET OF THE SECEETARY OF THE TEEASUEY

velopment of children, and a study of midwifery as practiced by
colored midwives in Virginia and North Carolina. Data obtained
from the dental examination of over a million and a half school
children in 26 States are being analyzed in an effort to determine
the dental needs of children of school age.
Studies were made of the manufacturing processes and their relations to skin hazards in 22 plants employing 8,770 persons. About
5,000 employees of these plants were examined for industrial skin
diseases.
The study of the effect of dust exposure on the health of miners in
the anthracite coal fields of'Pennsylvania, conducted at the request
of the Governor of the State, with the cooperation of operators and
workers, has been completed. Other industrial hygiene studies have
included a series of injections of dusts of known chemical and petrographic composition into guinea pigs to determine the nature of the
injury caused by these dusts when injected into the body tissue and,
therefore, their relative harmfulness; an investigation of the relation of pulmonary infection to pneumoconiosis; a study of silicosis
and tuberculosis in zinc and lead miners; the pollution of air; and the
incidence of illness among industrial workers.
Milk sanitation investigations dealt with the effect of variations
in p H concentration and the effect of variations in buffer concentralion upon the thermal resistance of the Public Health Service test
organism used in testing milk pasteurization equipment. As a result
of these tests it was determined that future studies of pasteurization equipment should be conducted at a p H concentration of 7.2 or
a buffer concentration of m/675. Further studies were made of the
bactericidal treatment of milk cans by means of hot air, and it was
concluded that a temperature of 170° F . for 30 minutes would devitalize all milk-borne pathogens.
Sugar researches were continued, with special reference to studies
on the oxidation of sucrose, the action of various acidic hydrolyzing
agents on methyl glycosides, and on the 4-carbon sugar threose.
As a result of enzyme researches on invertase, a relatively convenient method has been developed for obtaining concentrated
solutions of this enzyme.
Studies of various phases of the relation of sickness to the depression have shown that sickness among those on relief greatly exceeds
sickness among those of reasonably comfortable economic status and
those wdth very low incomes but not on relief. The high rate in
this group suggests that the relief population contains a disproportionately large number of persons who have chronic diseases or
physical defects or who are susceptible to frequent attacks of acute
illness.
Experimental and observational data collected in recent years
have indicated the desirability of practical limits of pollution for
lakes and streams, for the avoidance of nuisance conditions, and for
the protection of surface sources of public water supplies. Studies
have been continued in sewage treatment to determine the conditions which affect detrimentally the biological activity upon which
purification of sewage by the activated sludge process depends. A
series of experimental observations has been instituted dealing with

EEPORT OF THE SECRETAEY OF THE TEEASUEY

167

the physical and biochemical changes occurring in sewage sludge
deposits under conditions approaching those of natural streams.
Reports on the eastern type of Rocky Mountain spotted fever and
typhus fever have shown a definite increase in the number of cases
of typhus in some of the Southern States, spotted fever remaining
practically the same.
Studies of epidemic encephalitis indicate that immunity to the
St. Louis type of encephalitis is wide-spread in the United States.
Experiments also have shown that the instillation of alum into the
nostrils of white mice tends to render them less susceptible to intranasal infection with this virus. I t was found that monkeys treated
intranasally with sodium aluminum sulphate solution were rendered
resistant to intranasal instillation of the poliomyelitis (infantile
paralysis) virus.
Studies on the epidemiology of the amoebic dysentery outbreak
originating in Chicago in 1933 were completed. Work has now been
initiated with special reference to the bacillary type of dysentery as
it occurs among Indians of the Southwest.
The epidemiology of the California outbreak of poliomyelitis in
the summer of 1934 was investigated. The epidemic was mild and
showed a tendency to attack older children and young adults to a
greater extent than did epidemics of former years..
Division of Marine Hospitals and ReUef
The marine hospitals and other relief stations treated a daily
average of 4,936 in-patients and 3,153 out-patients. There were
49,018 patients who received hospital treatment during the year,
as compared w:ith 42,611 the previous year. Hospital and outpatient care was furnished at marine hospitals and other relief
stations to a total of 332,034 beneficiaries. The number of hospital
days was 176,032 more than last year.
During June 1935, funds became so limited that it was necessary
to reduce the number of in-patients in marine and contract hospitals
from 4,945 on June 1 to 4,455 on June 30. Operation of the hospitals
became exceedingly difficult on account of inadequate appropriations
and personnel. Because of an increase in the number of old-line
beneficiaries, and because of Civil Works Administration patients for
w^hose care no additional funds were provided, together with a steady
rise in the cost of hospital supplies, it was necessary in June to secure
a release of additional funds from the Treasury.
Notwithstanding the increased prices for supplies, the per diem
cost of operation was kept down to $3.31. This was accomplished
by keeping personnel at the lowest practicable number and by foregoing replacement and repair of equipment in normal amount.
• Division of Veoiei^eal Diseases
-Among the activities concerned with venereal diseases are investigations related to the control of syphilis and gonorrhea, to clinical
studies of syphilis, and to experimental work in the laboratory.
The control work has been of a general character and has been
conducted in cooperation with State and local health departments.
An attempt has been made to obtain more complete morbidity re

168

REPORT OF THE SECRETARY OF THE TREASURY

ports of syphilis and gonorrhea by releasing monthly statements of
the number of new cases of these diseases reported to State health
departments.
From studies of the trend of the venereal diseases in this country,
covering representative areas with more than 25,000,000 people, it is
estimated that 1,555,000 new cases of gonorrhea and 518,000 new cases
of syphilis annually seek treatment in the United States.
• The results of the study to evaluate serodiagnostic tests for syphilis
indicate the relative value of the tests which have been described
by the serologists of the United States. By further evaluating
serologic tests for sj^philis in State and local laboratories it will be
possible to riieasure the adaptability of each test for workers other
than the original serologist who described the test.
A series of scientific papers on the treatment of cardiovascular
syphilis has been completed. These papers represent a portion of
the clinical studies which have been under way for 6 or 7 years and
are based upon records provided by 5 of the leading clinics of the
country. I n addition to the studies of the treatment of cardiovascular syphilis, a scientific paper was also published on the results
attained by the modern treatment of early syphilis as compared with
the treatment employed several decades ago.
The informative and educational program has been continued.
For physicians the monthly abstract journal, Venereal Disease Information, has served a very useful function and its circulation has
increased. References to current medical literature and reprints of
scientific articles have been furnished to physicians and health officers. Pamphlets pertaining to the prevention and treatment of the
venereal diseases and to sex education have also been available for
general distribution.
The Public Health Service Clinic at Hot Springs National Park,
Ark., continued to treat a constantly increasing number of patients,
who came to seek the beneficial effects of the waters of Hot Springs.
Approximately two-thirds of these individuals are infected with
venereal disease.
Division of Mental Hygiene
The activities of the Division of Mental Hygiene included studies
of the nature and treatment of drug addiction and dissemination
of information upon the subject; studies of the abusive uses of narcotic drugs; administrative functions incident to the establishment
of narcotic farms; provision of medical and psychiatric services for
the Federal penal and correctional system; and cooperation with
other agencies interested in various phases of the work of the
Division.
Studies of the nature of drug addiction were continued at the
United States Penitentiary Annex, F o r t Leavenworth, Kans., during the first half of the year. Experimental investigations were
conducted on the value of certain substitutes for morphine. All of
these substitutes^ were found to have addictive properties similar to
morphine. Studies were also undertaken in connection with the
treatment of drug addiction.
A process for manufacturing dihydrodesoxymorphine-D was patented and its custody lodged, ex officio, with the Secretary of the
Treasury. Further studies of the addiction liability of this new

EEPOET OF T H E SECEETARY OF T H E TEEASUEY

169

substance were carried on among cancer patients, the results of which
indicate that the substance in question has very limited clinical value
and exceedingly dangerous addictive properties.
°
Further information concerning the incidence and other factors
in drug addiction were collected during the year, and several publications were issued on the various phases of this subject.
The first United States Narcotic F a r m at Lexington, Ky., was
formally dedicated and. opened by the Surgeon General on May 25,
1935. Admissions were accepted on and after May 29, 1935, and at
the close of the fiscal year 280 persons had been admitted for the
treatment of drug addiction. Preliminary plans for th. esecond institution at Fort Worth, Tex., have been approved, and it is anticipated that the contract for the necessary buildings will be accepted
early in the autumn of 1935.
The Attorney General has requested the Public Health Service to
extend the psychiatric work conducted for the Federal penal and
correctional system to all Federal courts.
Division of Personnel and Accoumts
Personnel.—The reduction of the personnel in marine hospitals
and quarantine stations, made necessary by decreased appropriations,
and the increase in the number of patients has presented administrative problems. A t the hospitals for the past few years it has been
necessary to assign medical internes to duties which should be
performed by more experienced medical officers.
On July 1, 1935, the regular commissioned corps of the Public
Health Service consisted of 335 commissioned officers and 64 reserve
officers on active duty. Other personnel of the service totaled 5,896,
not including 4,643 collaborating and assistant collaborating epidemiologists who served at nominal compensation and who Avere for the
most part officers or employees of State and local health organizations.
Financial statements.—^"Following is a statement of appropriations
and expenditures for the fiscal year 1935:
Appropriated

Received
from other
sources

Salaries, Oflace of Surgeon General
P a y , etc., commissioned oflBcers.
P a y of acting assistant surgeons
P a y of other employees
F r e i g h t , t r a n s p o r t a t i o n , etc
M a i n t e n a n c e , N a t i o n a l I n s t i t u t e of H e a l t h
Books
P a y of personnel a n d m a i n t e n a n c e of hospitals
•Quarantine service
P r e v e n t i n g t h e spread of epidemic diseases. _.
P r e v e n t i n g t h e spread of e p i d e m i c diseases, 1935-36...
Field investigations of p u b l i c h e a l t h
I n t e r s t a t e q u a r a n t i n e service
-Studies of rural sanitation
'Control^of biologic p r o d u c t s

$274,113
1,397,606
270,000
877,500
25,160
60,000
450
4,915,000
322,150
199,718
8,000
209, 313
35, 495
25,032
39, 524

$18, 967
196, 736
19, 111
71,237
30

Division of venereal diseases
Division of m e n t a l h y g i e n e . . .
Educational exhibits._
Working Capital F u n d
P a y m e n t to oflSicers a n d employees in foreign countries
d u e to appreciation of foreign currency

1 390, 000
1,000
1 65,000

Appropriation

Total..

! 9,163,869

1 $65,000 transferred t o " W o r k i n g C a p i t a l F u n d , " narcotic farm.
^ S t a t e m e n t does n o t include e x p e n d i t u r e of $7,490 from t r u s t f u n d s .

1,126,079
9,l05"
23, 960
319
379
2,060
3,447
3,184

Total
available

Expended

$293, 080
1, 594, 342
289, 111
948, 737
25,190
50, 000
450
6, 041,079
322,160
209,123
8,000
233,273
35,814
25, 411
41, 584

$291, 689
1, 577. 596
275,924
936, 331
24,737
49, 055
448
6, 041. 079
306, 733
205, 003
1,516
229,184
34, 686
25,267
41,141

62, 255
393,184
1,000
65.000

62,106
387,992
986
47,135

49,100

46,668

1, 524, 014

10, 687,883

10, 586, 276

170

EEPOET OF THE SECRETARY OF THE TEEASUEY

Expenditures from allotments of funds from other bureaus and
offices for direct expenditure during the fiscal year 1935 were as
follows:
Appropriation

Allotted

Veterans' Administration, working fund
Department of Justice, medical and hospital service, penal institutions
Public Works Administration, national industrial recovery
Civil Works Administration, working fund
Federal Emergency Relief Administration, working fund
._
Public Works Administration, working fund
Total

Expended

$304,899
1 432,478
459, 748
37, 795
943, 533
75

$304,899
432, 297
459,748
37, 795
943, 633
75

2,178, 528

2,178, 347

1 Includes $14,000 transferred under acts of Mar, 29, 1934, and Feb. 13, 1935.

The revenues derived from operations of the Public Health Service
during the year and covered into the Treasury as miscellaneous
receipts were as follows:
Source

Amount

General fund receipts:
Quarantine charges..
Hospitalization charges and expenses
..Sale of subsistence
-Sale of occupational therapy products
Sale of obsolete, condemned, and unserviceable equipment
Rents
Reimbursement for Government property lost or damaged
Commissions on telephone pay stations installed in service buildings
Sale of refuse, garbage, and other by-products
Sale of livestock and livestock products
Other revenues
Total..J
.Trust fund receipts:
Sale of effects of deceased patients
Inmates' funds....•
Grand total

$218, 534. 52
35, 979. 39
11, 328. 01
561. 94
9, 312,14
2,417. 00
398. 45
1, 257.10
1, 241. 60
377. 90
235. 21
281, 643. 26

955. 76
1, 363. 78

-.-

283,962. 80

DIVISION OF RESEARCH AND STATISTICS

The Division of Research and Statistics in the Office of the Secretary of the Treasury and the position of Director of Research and
Statistics were created by an order of the Secretary dated September 17, 1934. By the terms of the order the Director of Research
and Statistics exercises responsibility for the production, analysis,
and publication of statistics, and the conduct of economic research
in all branches of the Department.
The Division, which absorbed the duties of the Section of Financial and Economic Research, pursues intensive research in the fields
of taxation, Federal financing, and monetary problems, and supplies
information and anal3^ses over a broad range of economic subjects.
Taxation
A continuing function of the research staff of the Division is the
preparation of estimates of tax receipts for the current and the
succeeding fiscal years. This work involves estimates in detail of
receipts from each source of Federal revenue. Research is likewise

EEPOET OF THE SECRETARY OF THE TREASURY

171

undertaken in connection with all changes in the Federal tax structure. Studies are also in process relating to the extent and character of conflicting and overlapping taxation by Federal, State, and
local governments.
Federal financing
i=>^

The Division acts in a research capacity to the Secretary of the
Treasury in problems relating to Treasury financing. Domestic
conditions affecting the financing are analyzed, and foreign methods,
of financing are studied.
Monetary problems
The Division is charged with the responsibility of providing data,
surveys, analyses, and reports on a broad range of domestic and
foreign economic subjects to aid the Secretary of the Treasury in
connection with the monetary problems arising out of the operation
of the stabilization fund, the international movements of gold, the
relationship of the dollar to foreign currencies, and the execution
of the provisions of the numerous acts pertaining to the purchase of
gold and silver.
The Emergency Banking Act of March 9, 1933, the Farm Relief
Act of May 12, 1933, the London Silver Agreement of July 22, 1933,
the Gold Reserve Act of January 30, 1934, the Silver Purchase Act
of J u n e 19, 1934, and the various Presidential orders contain provisions for action by the Secretary of the Treasury the performance
of which requires careful economic analysis of the numerous factors
involved. Among the subjects which call for constant study are production, stocks, use, and movements of gold and of silver; short-term
and long-term capital movements; foreign exchange movements and
controls; foreign central bank policies and actions; and those economic and financial conditions in foreign countries which have a
direct bearing on these problems.
Machinery has been s<et up to obtain detailed reports weekiy from
all banks, brokers, and dealers, of changes in bank balances held by
foreigners, and in balances held abroad by Americans, and of all
international security transactions and foreigTi exchange operations.
These data are tabulated and analyzed, and reports are made weekly
to the Secretary.
Studies of price and exchange movements and of the results of
current changes in international balances of payments and trade,
are also carried on to determine the position of the dollar in relation
to other currencies.
Actuarial analysis
The Government Actuary, who is a member of the Division of
Research and Statistics, m,akes various studies relating to insurance, pensions, and finance, and serves as a member of the Federal
Board of Actuaries under the provisions of the Civil Service Retirement Act. The Social Security Act requires the Secretary of the
Treasury to include in his annual report the actuarial status of the
old-age reserve account. The actuarial work in this connection will
be performed by the Government Actuary.

172

REPORT GF THE SECRETARY OF THE TREASURY
SECRET SERVICE DIVISION

During the fiscal year 1935, 3,657 persons w^ere arrested by agents
of the Service, or by their direction, on charges involving counterfeiting of the obligations and coins of the United States and forgery,
as well as miscellaneous offenses against the statutes relating to the
Treasury Department. Of this number, 1,562 were note counterfeiters and note passers, 57 were note raisers and passers of altered
currency, 779 were coin counterfeiters and coin passers, 529 were
check forgers, 15 were apprehended for negotiating stolen or forged
bonds, 5 were held for fraudulent negotiation of adjusted service
certificates, 15 were arrested for violating the Gold Reserve Act of
1934, and 191 for miscellaneous offenses; and 504 were dismissed. .
Ten new counterfeit issues were discovered, all photo-mechanical
productions and, for the most part, deceptive and warranting
distribution of descriptive warning circulars. I n addition, 66 counterfeits of varying types of workmanship were discovered in different sections of the country. The latter issues generally were
extremely crude productions and were quickly suppressed.
Counterfeit notes aggregating $1,418,464 were captured or seized
during the year by operatives of the Service. This total includes
altered currency aggregating $4,270, of which $980 was made and
passed in foreign countries, and fractional currency amounting to
$276.25. Counterfeit coins to the amount of $74,847.27 were confiscated by agents in connection with raids and subsequent arrests,
and $94 of counterfeit foreign notes and coins were also seized.
I n connection with investigations and arrests, operatives captured or seized 349 metal plates, 249 film and glass negatives for
printing counterfeit obligations and securities, 24^4 steel dies, 57
metal molds, 466 plaster molds, and 3 wood molds for counterfeiting coins, and a large quantity of miscellaneous paraphernalia and
materials.
Of the counterfeit notes captured during the year, a total of
$379,539 was used in evidence against the makers and passers, and
$1,140 of altered notes were likewise used in evidence in the prosecution of note raisers and passers of altered notes. Counterfeit
coins totaling $5,101.64 w^ere also used in evidence in cases of this
character.
Of the cases brought to trial, 1,885 persons were convicted and
sentenced, 158 were acquitted, 828 are ia-waiting action of the
courts, while others were variously disposed of, some being committed to insane asylums and others delivered to the military and
police authorities. The 504 persons who were dismissed after having been apprehended in company with known criminals are listed
as suspects and their records are known to the Service.
Agents during the year conducted investigations of 2,374 check
cases, 57 bond cases, and 3 war savings stamp cases. I n check case
investigations, the sum of $5,262.51 was received in restitution and
tTansmitted to the Department.,
There were referred to the Service for investigation 62 cases from
the Veterans' Administration, involving violation of the World War
Adjusted Compensation Act; 30 cases from the F a r m Credit Administration, involving offenses against the F a r m Loan Act; and

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173

424 cases involving violation of the Gold Reserve Act of 1934..
Inquiries in 173 cases were received from the Procurement Division
for information concerning prospective bidders on Government
supplies.
TREASURER OF THE UNITED STATES

Public moneys are received and disbursed through the accounts'of
the Treasurer of the United States with designated Government
depositaries and the Treasury at Washington.
Funds appropriated by Congress for the use of the various departments and establishments of the Government are advanced to disbursing officers as required and credited to their accounts on the
books of the Treasurer, and all disbursements therefrom are madeby checks drawn on the Treasurer.
The total receipts and total expenditures of the Government for
the fiscal years 1934 and 1935 are compared in the following table.
The figures used in this table and throughout this section of the
report (pp. 173 to 177, inclusive), are on the basis of daily Treasury
statements (revised). (For an explanation of accounts, see p. 294; and
for an explanation of bases, see p. 293.)
1934
Receipts:
General and special accounts
Trust accounts:
Increment resulting from reduction
the weight of the gold.dollar
,-.
Seigniorage!.
Other trust accounts
Total _---.

1935

Increase (+) or
decrease (—)

$3,121, 431,99L 22 $3,800,972,151. 02 -f$679, 540,159. 80' •
2,811, 397,066,15
161, 273, 515. 81
6,094,102, 573.18

1, 722, 751. 97 -2, 809, 674,314.18140, 111, 441. 47 +140, 111, 441. 47
237, 358, 693. 94
+76,085,178.134,180,165, 038. 40 -1,913, 937, 534. 78'

Expenditures:
Transactions in checking accounts of govern-'
mental agencies (net)
-437, 074, 669. 68
-437, 074, 669.68
Chargeable against increment on gold:
Exchange stabilization fund
2,000, 000, 000. 00
-2,000,000, 000. 00
Melting losses, etc
+675, 121. 93
676,121. 93
Payments to Federal Reserve banks (sec.
13b, Federal Reserve Act, as amended).
20, 931, 857. 34
+20,931 857. 34
Retirement of national bank notes
91,415, 650. 00
+91, 415, 650, 00
Public debt retirements chargeable against
359,865,092. 90
ordinary receipts
573, 557, 250. 00 +213, 692, 157.10'
6,909, 789, 429.56 6,984,397,309.27
All other expenditures
+ 74,607, 879. 71
TotalExcess of expenditures over receipts, including
trust funds

9, 269,654, 522,46

7,233,902,518.1

3.175, 551.949, 28 3.053,737.480.46

-2,035,752,003.60-121.814.468.82-

1 Represents the seigniorage resulting from the issuance of silver certificates equal to the cost of thesllver acquired under the Silver Purchase Act of 1934 and the amount returned for the silver received under
the President's Proclamation dated August 9,1934.
a Represents transfers aggregating $333,245,377.93 of balances in checking accounts of special agenciesof the Government as of May 31, 1935, and net transactions since that date of $103,829,291.75.

174

EEPOET OF THE SECEETAEY OF THE TEEASUEY

Receipts and expenditures on account of the principal of the public
debt during the fiscal year 1935 were as follows:
Class

Receipts

Treasury bills
Certificates of indebtedness
Certificates of indebtedness (adjusted service certificate fund
series)
_
Treasury notes
Treasury notes (civil service retirement fund series)
Treasury notes (Foreign service retirement fund series)
Treasury notes (Canal Zone retirement fund series)
•».
Treasury notes (Postal Savings System series)...
Treasury notes (Federal Deposit Insurance Corporation series)..
Treasury bonds
United States Savings Bonds
War savings securities
Treasury savings securities.
First Liberty bonds
Second Liberty bonds
Third Liberty bonds..
Fourth Liberty bonds
Victory notes
Postal savings bonds
Other debt items
Deposits for, and retirements of, national bank notes and Federal
Reserve bank notes.

$4,007, 066,000.00

Total.

213,600, 000.00
4, 678,893, 500.00
41, 400, 000.00
765, 000.00
111, 000. 00
90, 000, 000. 00
100, 000, 000.00
3,351,392,950.00
62, 567, 043. 75
11.88

25, 718,880.00

Expenditures
$3, 326, 590, 000. 00
1, 622, 470, 300.00
175, 900, 000. 00
1, 302,646,700. 00
32,400, 000. 00
509, 000. 00
64, 000. 00
555, 000.00
530, 887. 50
21, 825. 50
100, 916. 00
1, 788, 406,650. 00
280, 200.00
456,050.00
3, 077,600,050. 00
69, 650.00
1,799, 500. 00
3,303. 33

554,166,925. 00

247,310, 320.00

13,125,681,310.63

11, 477, 714, 352.33

Public debt retirements chargeable against ordinary receipts, included in the above public debt expenditures, were as follows:
Cumulative sinking fund
Forfeitures, gifts, e t c . .
Total-.-

$573, 000,000
557, 250
573,557,^0

The gold holdings of the Treasury as of June 30, 1934 and 1935,
valued at $35 an ounce, are shown in the following table:
June 30, 1934
Reserve against gold certificates outstanding
Gold certificate fund. Federal Reserve Board
Redemption fund. Federal Reserve notes..
Reserve against United States notes and Treasury notes of 1890...
Exchange stabilization fund..
Gold in General Fund
Total

June 30, 1935

Increase (+) or
decrease (—)

$958,463, 029.00
$787,646, 039.00 -$170,816,990.00
3, 973,332, 588. 66 5, 509, 710,115. 48 +1, 536, 377, 526. 82
25, 722, 721. 73
22, 879, 855, 28
-2,842,866.45
156, 039, 430. 93
156, 039,430. 93
1, 800, 000,000.00 1, 800, 000,000.00
942,622, 786.13
839, 368, 051.28

-103,254,734.85

7, 856,180, 556, 45 9,115, 643, 491.97 +1, 259, 462, 935. 52

The uicrease in the gold holdings was made up as follows:
Purchases by mints and assay oflQces on account of imports, etc., (valued at $35 an
ounce)
$1,255,254,691.36
Eeceived under the order of the Secretary of the Treasury of Dec. 28, 1933, (valued at
$20.67+an ounce)
2,485,492.19
Increment resulting from reduction in the weight of the gold dollar..
1, 722, 751.97
Total-

- -

1,259,462,935.52

Paper currency of each class issued and redeemed during the fiscal
year 1935 and the amounts outstanding, including Treasury holdings,
on June 30, 1934 and 1935, were as follows:

EEPOET OP THE SECEETABY OF THE TEEASUEY
Outstanding
June 30,1934

Class
Gold certificates
Silver certificates
United States notes
Treasury notes of 1890
Federal Reserve notes
Federal Reserve bank notes
National bank notes

Issued

Redeemed

175
Outstanding
June 30,1936

$1,141,200,779
$15,455,600 $368.883, 630 $787.772,849
498.018.431 922,561. 600 604,815,044
815.764. 887
346.681. 016 237.756.000
237, 766.000
346.681. 016
1.191. 000
7.650
1.183.360
3, 350.987, 755 1. 764.666.620 1, 622. 700. 656 3.492. 853. 620
160,666, 263
4,250
76. 316.140
84. 364. 373
962,130, 553 247.929,020
436. 942,828
773,116, 745

6/460, 875. 797 3,188, 272.890. 3. 347,421,847

Total...

6,301,726, 840

The paper currency held by Treasury offices and Federal Reserve
banks on June 30, 1935, was as follows:
Held in Treasury oflSces and
by Federal Re- Held by Fedserve banks
eral Reserve
and agents in
banks
custody for the
Treasurer, U. S.

Class

Gold certificates..
Silver certificates
..
United States notes
Treasury notes of 1890 . .
Federal Reserve notes
Federal Reserve bank notes
National bank notes
Total

._
...

. . . . . .

•

Total

$126,810 $670,479,090
5,751.210
108,539,486
69.379.479
1.884.332
1.776
15,974,600
263,966, 026
1.584,027
1,300, 790
1 33,650, 201
36, 203. 270

$670,605,900
114.290,696
61,263,811
1.776
269,940,525
2,884.817
68.853.471

58,972,856 1,128,868.140

1.187,840,996

1 Includes $4,021,100 held by the Comptroller of the Currency for destruction.

The amount of United States paper currency shipped during the
fiscal year 1935 from the Treasury in Washington to Treasury offices,
Federal Reserve banks and branches, and others amounted to
$1,139,905,458, an inc^rease of $347,%40,378 as compared with the
previous year. Of this increase, approximately 78 percent was on
account of the shipirient of silver certificates.
The proceeds of currency counted into the Treasurer's cash by the
National Bank Redemption Agency amounted to $536,073,329.30,
of which $442,232,784 was in national bank notes, $58,191,395 in
Federal Reserve bank notes, $35,571,305 in Federal Reserve notes,
and $77,845.30 in United States currency.
Canceled Federal Reserve notes amounting to $1,157,491,400 were
received from Federal Reserve banks and branches for credit of
Federal Reserve agents.
During the year the Treasurer's office authorized and directed
shipments or transfers of current silver and minor coins to or from
the Treasury, the mints, the assay office in New York, and the Federal
Reserve banks and branches for use in public disbursements and for
special purposes in an aggregate amount of $49,780,361.60. Shipments and transfers of gold coin and bullion and of uncurrent silver
and minor coins to the mints from the Treasury in Washington and
from the Federal Reserve banks and branches were authorized in the
amounts of $914,097,129.68 and $10,751,356.20, respectively.
16816—36

176

EEPOET OF THE SECEETARY OF THE TEEASURY

Public moneys on deposit in designated Government depositaries
on June 30, 1935, exclusive of items in transit on that date, amounted
to $925,656,836.36 and were distributed as follows:
Class of depositary

To credit of
Treasurer

Federal Reserve banks and branches..
—
Special depositary banks (account of sales of Government securities).,.
General depositary banks
-..
Limited depositary banks
Foreign depositary banks
Treasury of the Philippine Islands
-...

$102,236,863.22
779.020.320.27
8.228.196.66
968.839.44
2,133,257. 29
892.687.476.78

Total.

To credit of
other Government oflQcers

$9.503,081.79
21,982,678.21
1,583,699.68
33.069.359.58

Government and other securities held in custody by the Treasurer
on June 30, 1935, amounted to $19,484,166,144, whereas the
amount held on June 30, 1934, was $19,035,094,929, an increase of
$449,071,215. The purposes for which the securities were held and
the amounts thereof as of June 30, 1934 and 1935, were as follows:
Purpose for which held
To secure national bank note circulation
,
To secure deposits of public moneys in depositary banks
Tosecuire Postal Saivingsfunds....
Held for special trust accounts.
Held for District of Columbia teachers' retirement fund
Held for Longshoremen's and Harbor Workers' fund
Held for District of Columbia Workmen's Compensation fund
Total

June 30,1934

June 30, 1935

$737,023,670
52,920,506
738,868, 235
' 17,600,658.708
6,696,160
107.660
21.000

$143, 743,910
60,646,700
408,308, 238
18,875,310.666
6.022.390
114.350
21.000

/19.035.094,929

19.484,166,144

The number of pieces of public debt principal obligations examined,
verified, and redeemed during-the j^ear was 4,105,416 as compared
with 1,888,858 for the previous fiscal year.
Checks in payment of interest on the registered obligations of the
United States verified and paid, numbered 1,584,328, and amounted
to $112,222,836.04. Interest coupons of Government obligations
examined, verified, and paid, numbered 15,736,679 and amounted
to $645,737,720.56.
The checks issued by the Treasurer of the United States in
payment of interest on the registered obligations of governmental
agencies and insular governments numbered 30,796 and amounted
to $11,276,747.55. Coupons of obligations of governmental agencies
and insular governments paid numbered 6,759,856 and amounted to
$87,387,646.91.
Funds were advanced to United States disbursing officers by accountable warrants issued in an aggregate amount of $7,054,861,015.02.
Warrants aggregating $13,143,937,106.27 were also issued covering
public debt principal and interest payments by the Treasurer.
Treasurer's checks aggregating $124,811,711.37 were issued on settlement warrants in payment of claims settled by the Comptroller
General.
^ Drafts were purchased in payment of claims settled in 57 dift'erent
lands of foreign currencies for the Comptroller General and for other

REPORT OF THE SECRETARY OF THE TEEASUEY

177

departments and bureaus of the Government at a total cost of
$170,290.61.
Checks drawn on the Treasurer of the United States by Government
disbursing officers and paid during the year numbered 71,340,442,
a decrease of 33,276,202 checks as compared with the previous year,
Balances to the credit of disbursing officers and Government agencies
in 4,690 accounts on June 30, 1935, amounted to $1,277,067,364.17,
an increase of $417,916,496.93 over the total of such balances iri
4,467 accounts on June 30, 1934.
WAR FINANCE CORPORATION
(In liquidation)

By the act of Congress approved March 1, 1929, the liquidation of
the War Finance Corporation's assets remaining after the close of
business, April 4, 1929, and the winding up of the affairs of the
Corporation thereafter were transferred to the Secretary of the
Treasury. During the fiscal year ended June 30, 1935, the liquidation of the Corporation was continued.
Pursuant to an brder of the Secretary of the Treasury approved by
the President January 24, 1935, the disbursing functions of the War
Finance Corporation were transferred, under the provisions of
Executive Order No. 6166 of June 10, 1933, as amended, to the
Division of Disbursement effective February 1, 1935, together with the
personnel engaged in the performance of such disbursing functions.
The Corporation has outstanding only $10,000 of its original capital
of $500,000,000, capital stock of $499,990,000 having been retired at
par. During the year the Corporation collected the balance due on
the security taken by the Corporation in the reorganization of an
industrial company which had received an advance during the war.
The liquidation of this war loan advance in full enabled the Corporation to pay into the Treasury on March 1, 1935, the sum of $100,000,
increasing to $64,731,271.70 the amount paid into the Treasury on
account of earnings.
The amount advanced by the Corporation for all purposes, from
its creation, not including such part of new applications as represented
proceeds used to retire other advances, was $690,431,100, of which
$688,604,140 has been repaid.
The total assets carried on the Corporation's books on June 30,
1935, amounted to $130,192.77, which ccjnsisted of cash of $122,220.15;
furniture and fixtures of $1; and agricultural and livestock loans
(including expense advances of $372.22) of $7,971.62. During the
year no expense advances were made. The total receipts amounted
to $129,676.94, including repayments aggregating $128,201.86, of
which $10,825.96 was applied on account of the Corporation's agricultriralyand livestock loans and $117,375.90 on account of war loans,
Total expenditures, excluding $100,000 paid into the Treasury,
amounted to $5,838.43.

EXHIBITS

179

THE PUBLIC DEBT
Issues and redemptions of United States bonds, notes, and certificates of
indebtedness
Exhibit 1
Offervng of l'V2 percent Treasury notes of series D-1936, 2^2 percent Treasury
notes of series D-1938, and 3^, percent Treasury bonds of 1944-46 (additional)
On September 10, 1934, Secretary of the Treasury Morgenthau offered for
subscription two series of Treasury notes and an issue of bonds in exchange
for Treasury certificates of indebtedness of series TS-1934 maturing September
15, 1934, and Fourth Liberty Loan 4 ^ percent bonds called for redemption
October 15, 1934. In the related press release it was stated that the amount
cf Treasury certificates maturing September 15, 1934, was $524,748,500, and the
amount of Fourth Liberty Loan bonds eligible for exchange for the new securities was slightly less than $1,250,000,000.
[Treasury notes, series D-1936.

Department Circular No. 5221
TREASURY DEPARTMENT,

Washington, September 10, 1934'
EXCHANGE OFFEORING OF NOTEIS

The Secretary of the Treasury, pursuant to the authority of the Second Liberty Bond Act, approved September 24, 1917, as amended, offers for subscription, at par, li/^ percent notes of the United States, designated Treasury notes
of series D-1936, in payment of which only Treasury certificates of indebtedness of series TS-1934, maturing September 15, 1934, may be tendered. The
amount of the offering is limited to the amount of Treasury certificates of
indebtedness of series TS-1934 tendered and accepted.
DESCRIPTION OF NOTES

The notes will be dated'September 15, 1934, and will bear interest from that
date at the rate of 1% percent per annum, payable semiannually on March 15
and September 15 in each year. They will mature September 15, 1936, and
will not be subject to call for redemption prior to maturity.
The notes shall be exempt, both as to principal and interest, from all taxation (except estate or inheritance taxes) now or hereafter imposed by the
United States, any State, or any of the possessions of the United States, or by
any local taxing authority.
.,
The riotes will be accepted at par during such time and under such rules and
regulations as shall be prescribed or approved by the Secretary of the Treasury
in payment of income and profits taxes payable at the maturity of the notes.
The notes will be acceptable to secure deposits of public moneys, but will
not bear the circulation privilege.
Bearer notes with interest coupons attached will be-issued in denominations
of $100, $500, $1,000, $5,000, $10,000, and $100,000. The notes will not be
issued in registered form.
A P P L I C A T I O N AND A L L O T M E N T

182

REPORT OF THE SECRETARY OF THE TREASURY

Subject to the reservations made in the next succeeding paragraph, all subscriptions wiU be allotted in fuU.
The Secretary of the Treasury reserves the right to reject any subscription,
in whole or in part, and to close the books as to any or all subscriptions at
any time without notice; and any action he may take in these respects shall
be final. Allotment notices will be sent out promptly upon allotment.
T E R M S OF P A Y M E N T

Payment at par for any notes allotted under this circular must be made on or
before September 15, 1934, or on later allotment, and may be made only in
Treasury certificates of indebtedness of series TS-1934, maturing September 15,
1934, which will be accepted at par, and should accompany the subscription.
GENERAL PROVISIONS

As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions, to make allotments on the basis and up
to the amounts indicated by the Secretary of the Treasury to the Federal
Reserve banks of the respective districts', to issue allotment notices, to receive
payment for notes allotted, to make delivery of notes on full-paid subscriptions
allotted, and they may issue interim receipts pending delivery of the definitive
notes.
The Secretary of the Treasury may at any time, or from time to time, prescribe supplemental or amendatory rules and regulations governing the offering
which will be communicated promptly to the Federal Reserve banks.
HENRY MORGENTHAU, Jr.,

Secretary of the Treasury.
[Treasury notes, series D-1938.

Department Circular No. 523]
TREASURY

DEPARTMENT,

Washington, September 10, 1934.
E X C H A N G E OFFERING OF NOTES

T h e ' Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, offers for subscription, at par, 2^/^ percent notes of the United States, designated Treasury
notes of series D-193S, in payment of which only Fourth Liberty Loan 4^/4
percent bonds of 1933-38 included in the second call for redemption on October
15, 1934 (hereinafter referred to as second-called Fourth 4i^'s),^ may be
tendered.
The amount of the offering is limited to the amount of second-called Fourth
4%'s tendered and accepted. Fourth Liberty Loan bonds not included in the
second call for redemption on October 15, 1934, will not be accepted for exchange under this circular.^
In addition to the exchange offering under this circular, holders of secondcalled Fourth 4%'s are also offered the privilege of exchanging all or any part
of such called bonds for 3^/4 percent Treasury bonds of 1944-46, whicii offering
is set forth in Department Circular No. 524, issued simultaneously with this
circular.
DESCRIPTION OF NOTES

The notes will be dated September 15, 1934, and will bear interest from that
date at the rate of 2 ^ percent per annum, payable semiannually on March 15
1 Pursuant to the second call for partial redemption (see Department Circular No. 509,
dated Apr. 13, 1934) all outstanding Fourth Liberty Loan 4% percent bonds of 1933-38
bearing serial numbers ending in 2 or 8 (in the case of permanent coupon bonds preceded
by the distinguishing letter B or H, respectively) have been called for redemption on
Oct. 15, 1934, on which date interest on such bonds will cease.
2 First-called Fourth 4i/4's (wliich ceased to bear interest on Apr. 15, 1934) bear
serial numbers ending in 9, 0, or 1 (in the case of permanent coupon bonds preceded
by the distinguishing letter J, K, or A, respectively), and uncalled Fourth 4i/4-'s bear
serial numbers ending in 3, 4, 5, 6, or 7 (in the case of permanent coupon bonds preceded by the distinguishing letter C, D, E, F, or G, respectively).

EEPOET OF THE SECRETARY OF THE TEEASUEY

183

and September 15 in each year. They will mature September 15, 1938, and
will not be subject to call for redemption prior to maturity.^ * * *
Bearer notes with interest coupons attached will be issued in denominations
of $50, |100, $500, $1,000, $5,000, $10,000, and $100,000. The notes will not be
issued in registered form.
APPLICATION AND ALLOTMENT

Applications will be received at the Federal Reserve banks and branches arid
at the Treasury Department, Washington. =*= * ^=
TERMS OF P A Y M E N T

Payment at par for any notes allotted under tbis circular must be made on or
before September 15, 1934, or on Inter allotment, and may be made only in
second-called Fourth 4%'s, which will be accepted at par, and should accompany
the subscription. If any subscription is rejected, in whole or in part, the
second-called Fourth 4%'s tendered therewith and not accepted will be returned
to the subscriber.
Interest on second-called Fourth 4%'s tendered and accepted will be paid
in full to October 15, 1934, on which date interest on all second-called Fourth
4%.'s will cease. Such payments will be made, in the case of coupon bonds,
through payment of coupons dated October 15, 1934, when due, which coupons
must be detached by holders before presentation of the bonds for exchange for
the notes offered hereunder, and, in the case of registered bonds, through the
issue of interest checks in regular course for final interest due October 15, 1934,
in favor of the holders of record on September 15, 1934.
SURRENDER OF SECOND-OALLED F O U R T H 4 % ' S ON E X C H A N G E

Coupon ^07^fZ5.^Second-called Fourth 4^;4's in coupon form tendered in exchange for Treasury notes offered hereunder, should be presented and surrendered to a Federal Reserve bank or to the Treasurer of the United States
and should accompany the application. All coupons bearing dates subsequent to
October 15, 1934,"^ should be attached to such coupon bonds when surrendered,
and if any such coupons are missing, the application must be accompanied with
cash paj^ment equal to the face amount of the missing coupons.^ The bonds
must be delivered at the expense and risk of tbe holder. Facilities for transportation of bonds by registered mail insured may be arranged between incorporated banks and trust companies and the Federal Reserve iDanks, and holders
may take advantage of such arrangements when available, utilizing such incorporated banks and trust companies as their agents. Incorporated banks and
trust companies are not agents of the United States under this circular.
Registered bonds.—-Second-called Fourth 4%'s in registered form tendered
in exchange for Treasury notes offered hereunder, should be assigned by the
registered payee or assigns thereof to " The Secretary of the Treasury for exchange for Treasury notes of series D-1938 ", in accordance with the general
regulations of the Treasury Department governing assigntiients for transfer or
exchange, and thereafter should be presented and surrendered with the application to a Federal Reserve bank or to the Treasury Department, Division of
Loans and'Currency, Washington. The bonds must be delivered at the expense
and risk of the holder.
GENERAL PROVISIONS

As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions * * *.
PIENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
3 Omitted portions similar to corresponding sections of Department Circular No.
522, p. 181.
^ I t will be noted t h a t second-called F o u r t h 41,4's in coupon form tendered in exchange
for 3 % percent Treasury bonds under Department Circular No. 524 must have the Oet. 15,
1934, coupons attached as the interest represented by such coupons will be applied t o
the accrued interest on the 3^/4 percent Treasury bonds issued in exchange and the balance paid on delivery of such bonds or promptly following allotment.
5 The final coupon attached to temporary coupon bonds became due on Oct. 15, 1920.
The holders of any such temporary bonds which are included in the second call for p a r t i a l
redemption on^ Oct. 15, 1934, will receive the past due interest from Oct. 15, 1920.
if such bonds are tendered for exchange under this circular.

184

REPORT OF THE SECRETAEY OF THE TEEASURY
[Treasury bonds of 1944-46.

Department Circular No. 524]
TREASURY

DEPARTMENT,

Washington, September 10, 1934E X C H A N G E OFFERING OF BONDS

The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, for refunding purposes, invites subscriptions, at par with an adjustment of accrued interest as
of September 15, 1934, from the people .of the United States, for 3^/4 percent
Treasury bonds of 1944-46, in payment of which only Fourth Liberty Loan 4 ^
percent bonds of 1933-38 included in the second call for redemption on October
15, 1934 (hereinafter referred to as second-called Fourth 4i^'s) may be tendered.^ The amount of the additional issue of 3^/4 percent Treasury bonds of
1944-46 will be limited to the amount of second-called Fourth 4%'s tendered
and accepted. Fourth Liberty Loan bonds not included in the second call for
redemption on October 15, 1934, will not be accepted for exchange under this
circular.^
In addition to the exchange offering under this circular, holders of secondcalled Fourth 41^'s are also offered the privilege of exchanging all or any part
of such called bonds for 2% percent Treasury notes of series. D-1938, which
offering is set forth in Department Circular No. 523, issued simultaneously with
this circular.
DESCRIPTION OF BONDS

The bonds now offered will be an addition to and will form a part of the
series of 3% percent Treasury bonds of 1944^6 issued pursuant to Department
Circular No. 508, dated April 4, 1934, are identical in all respects therewith,
will be freely interchangeable, and are described in the following quotation from
said Circular No. 508:
" The bonds will be dated April 16, 1934, and will bear interest from that
date at the rate of 3^/4 percent per annum, payable on October 15, 1934, on a
semiannual basis, and thereafter semiannually on April 15 and October 15 in
each year until the principal amount becomes payable. They will mature April
15, 1946, but may be redeemed at the option of the United States on and after
April 15, 1944, in whole or in part, at par and accrued interest, on any interest
day or days, on 4 months' notice of redemption given in such manner as the
Secretary of the Treasury shall prescribe. In case of partial redemption, the
bonds to be redeemed will be determined by such method as may be prescribed
by the Secretary of the Treasury. From the date of redemption designated in
any such notice, interest on the bonds called for redemption shall cease.
"Bearer bonds with interest coupons attached and bonds registered as to
principal and interest will be issued in denominations of $50, $100, $500, $1,000,
$5,000, $10,000, and $100,000. Provision win be made for the interchange of
bonds of different denominations and of coupon and registered bonds and for
the transfer of registered bonds under rules and regulations prescribed by the
Secretary of the Treasury.
" The bonds shall be exempt, both as to principal and interest, from all taxation now or hereafter imposed by the United States, any State, or any of the
possessions of the United States, or by any local taxing authority, except (a)
estate or inheritance taxes, and (b) graduated additional income taxes, commonly known as surtaxes, and excess-profits and war-profits taxes, now or
hereafter imposed by the United States, upon the income or profits of individuals,
partnerships, associations, or corporations. The interest on an amount of bonds,
authorized by said act approved September 24, 1917, as amended, the principal
of which does not exceed $5,000 owned by any individual, partnership, association, or corporation, shall be exempt from the taxes provided for in clause
(b) above.
" The bonds will be acceptable to secure deposits of public moneys, and will
bear the circulation privilege only to the extent provided in the act approved
July 22, 1932, as amended. They wiU not be entitled to any privilege of
conversion.
1 Footnote omitted here, see footnote 1, p. 182.
2 Footnote omitted here, see footnote 2, p. 182,

EEPORT OF THE SECRETARY OF THE TREASURY

185

" The bonds will be subject to the general regulations of the Treasury De^
partment, now or hereafter issued, governing United States bonds."
A P P L I C A T I O N A N D ALLOTMENT

Payment at par and accrued interest to September 15, 1934, for any bonds
allotted under this circular must be made on or before September 15, 1934,
or on later allotment. Payment of the principal amount may be made only
in second-called Fourth 4i/j:'s, which will be accepted at par, and should accompany the subscription. If any subscription is rejected, in whole or in part,
the second-called Fourth 414's tendered therewith and not accepted will be
returned to the subscriber.
Interest on second-called Fourth 4^4:'s tendered and accepted will be paid
in full to October 15, 1934. In the case of coupon bonds accepted in exchange
such interest will be anticipated and paid upon the terms and conditions
hereinafter prescribed. Interest on all second-called Fourth 41^4's will cease on
October 15, 1934.
Coupon bonds.—Coupon bonds tendered in payment should have coupons
dated October 15, 1934, as well as all subsequent coupons attached; 3^/4 percent Treasury bonds in coupon form issued in exchange will have all coupons
attached, including the coupon maturing October 15, 1934, and a payment of
the amount by which the 4% percent coupon maturing October 15, 1934, exceeds
the accrued interest from April 16 to September 15, 1934, of the 3^/4 percent
coupon maturing October 15, 1934 (such excess being $7.752732 per $1000
principal amount), will be made upon delivery of the 3^/4 percent coupon bond;
3% percent Treasury bonds in registered form issued in exchange will bear
interest from September 15, 1934; and a payment of the full amount of the
4% percent coupon maturing October 15, 1934, will be made promptly following
allotment.
Registered bonds.—Interest on registered bonds tendered in payment and
accepted will be payable on October 15, 1934, to the holders of record on
September 15, 1934, the date of closing of the transfer" books; 3^/4 percent
registered bonds issued in exchange for registered bonds will bear interest
from September 15, 1934, and no cash payment for accrued interest will be
required; 3% percent Treasury bonds in coupo^n form issued in exchange for
registered bonds will have all coupons attached, including the coupon maturing
October 15, 1934; accordingly, a cash payment for accrued interest from
April 16 to September 15, 1934 ($13.497268 per $1,000 principal amount), must
accompany the application.
SURRENDER OF SECOND-CALLED F O U R T H 4 l 4 ' S ON E X C H A N G E

Coupon bonds.—Second-called Fourth 4%'s in coupon form tendered in exchange for Treasury bonds offered hereunder, should be presented and surrendered to a Federal Reserve bank or to the Treasurer of the United States
and should accompany the application. Coupons dated October 15, 1934,^ and
all coupons bearing dates subsequent to October 15, 1934, should be attached
3 It will be noted that second-called Fourth 4iA's in, coupon form tendered in exchange
for 2y2 percent Treasury notes of series D-1938 under Department Circular No. 523
will not have the October 15, 1934, coupon attached ; and there will, accordingly, be no
anticipation of interest upon exchange for notes under such circular.

186

REPORT OF THE SECRETARY OF THE TEEASUEY

to such coupon bonds when surrendered, and if any such coupons are missing,
the application must be accompanied with cash payment equal to the face
amount of the missing coupons.^ The bonds must be delivered at the expense
and risk of the holder. Facilities for transportation of bonds by registered
mail insured may be arranged between incorporated banks and trust companies
and the Federal Reserve banks, and holders may take advantage of such
arrangements when available, utilizing such incorporated banks and trust
companies as their agents. Incorporated banks and trust companies are not
agents of the United States under this circular.
Registered bonds.—Second-called Fourth 4i/4's in registered form tendered
in exchange for Treasury bonds offered hereunder should be assigned by the
registered payee or assigns thereof in accordance with the general regulations
of the Treasury Department governing assignments for transfer or exchange
in one of the forms hereafter set forth, and thereafter should be presented and
surrendered with the application to a Federal Reserve bank or to the Treasury
Department, Division of Loans and Currency, Washington. The bonds must
be delivered at the expense and risk of the holder. If Treasury bonds are
desired registered in the same name as the so-called Fourth 4^/4's surrendered, the assignment should be to " The Secretary of the Treasury for
exchange for Treasury bonds of 194^^46 "; if Treasury bonds are desired registered in another name, the assignment should be to " The Secretary of the
Treasury for exchange for Treasury bonds of 1944-46 in the name of
"; if Treasury bonds in coupon form are desired, the assignment should be to " The Secretary of the Treasury for exchange for Treasury
bonds of 1944-46 in coupon form to be delivered to
"
GENERAL PROVISIONS

As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions, to make allotments on the basis and
up to the amounts indicated by the Secretary of the Treasury to the Federal
Reserve banks of the respective districts, to issue allothient notices, to receive
payment for bonds allotted, to make delivery of bonds on full-paid subscriptions
allotted, and they may issue interim receipts pending delivery of the definitive
bonds.
The Secretary of the Treasury may at any time, or from time to time, prescribe supplemental or amendatory rules and regulations governing the offering
which will be communicated promptly to the Federal Reserve banks.
HENRY MORGENTHAU, Jr.,

Secretary of the Treasury.
Exhibit 2
Allotments on exchange subscriptions, Treasury notes of series D-1936 and series
D-1938, and Treasury bonds of 1944-46 {from press releases, Sept. 13, 17, 19,
21, and 25, Oct. 1, 1934, OAid Jan. 3, 1935, revised^)
On September 12, 1934, Secretary of the Treasury Morgenthau announced that
the subscription books for the exchange offering of 1% percent Treasury notes of
series D-1936 would close at the close of business September 13, 1934. Subscriptions aggregating $514,066,000 were received for these notes, which were
open only to the holders of Treasury certificates of indebtedness maturing
September 15, 1934.
The subscription books for the offering of 2% percent Treasury notes of series
D-1938 closed at the close of business September 24, 1934. Subscriptions for
these notes, offered in exchange for Fourth Liberty Loan bonds called for
redemption on October 15, 1934, aggregated $596,416,100.
The subscription books for the offering of the additional issue of 3 ^ percent
Treasury bonds of 1944r-46 remained open until the close of business October 11,
1934. Subscriptions for these bonds, also issued in exchange for the called
Fourth Liberty Loan bonds, aggregated $456,898,300.
The amount offered of each of the three issues was limited to the amount of
tenders accepted of maturing Treasury certificates or called Fourth Liberty Loan
bonds for which the particular issue was offered in exchange. Allotments were
divided among the several Federal Reserve districts and the Treasury as follows:
^ Footnote omitted here, see footnote 5, p. 183.
«Revised Nov. 23 and Dec. 31, 1934, and Jan. 30 and Apr. 30, 1935.

187

EEPORT OF T H E SECBETARY OF T H E TREASURY
Treasury
notes, series
D-1936

Treasurynotes, series
D-1938

Treasury
bonds of
1944-46

Boston
New York
Philadelphia..
Cleveland
Eichmond
Atlanta
Chicago—
St. Louis
Minneapolis-.
Kansas City..
Dallas
San Francisco.
Treasury

$14.273.500
382.247. 500
10.027, 000
12.988,000
4, 247.000
7, 408,000
40, 616,000
15. 621, 500
10,422, 000
6.158.000
3.964,500
5,051,000
1,142,000

$37, 582, 750
376,985. 050
17.288,800
26.627, 050
7.914.800
3.557,950
64,102,450
. 12,447,950
10, 478. 300
11,954,400
6,827,250
15,472. 750
5. 276.600

$20.098.800
134.381.300
24.179.600
62. 271,900
21,968,150
10, 842,300
65,578,400
28.372, 400
12, 235, 400
25,946, 550
9,010,450
20, 886,500
21,126,650

Total...

514,066,000

596.416,100

456,898,300

Federal Reserve district

Exhibit 3
Partial redemptiori on April 15, 1935, of Fourth Liberty Loan bomds before
maturity (third call)
On October 12, 1934, Secretary of the Treasury Morgenthau issued a third
call for the redemption on April 15, 1935, of three series of outstanding 4^/4
percent Fourth Liberty Loan bonds. This call included about $1,870,000,000 of
bonds.
The first call, issued October 12, 1983, included about $1,880,000,000 of bonds
called for redemption on April 15, 1934; and the second call, issued April 13,.
1934, included about $1,250,000,000 of bonds caUed for redemption on October
15, 1934, Through refunding during the previous 12 months about $2,750,000,000of bonds under the first two calls were exchanged for other interest-bearing
obligations of the United States, while about $380,000,000 of the bonds either
were paid or were to be paid in cash.
The text of the formal notice of call of October 12, 1934, was as follows:
To Holders of Fourth Liberty Lonn //i^ Percent Bonds of 19i33-38 and Others
Concerned:
Public notice is hereby given:
1. All outstanding Fourth Liberty Loan 4i^ percent bonds of 1933-38 (Fourth
41/4's) bearing serial numbers the final digit of which is 5, 6, or 7 (such serial
numbers in the case of permanent coupon bonds being prefixed by the corresponding distinguishing letter E, F, or G, respectively), are hereby called for
redemption on April 15, 1935, on which date interest on such bonds called for
redemption will cease.
2. This third call for partial redemption is made pursuant to the provision
for redemption contained in the bonds and in Treasury Department Circular
No. 121, dated September 28, 1918, under which the bonds were originally issued,
the bonds to be redeemed having been determined by lot in the manner prescribed by the Secretary of the Treasury.
3. Outstanding Fojirth 4i/4's bearing serial numbers (and prefix letters) other
than those designated are not included in or affected by this third call for
partial redemption.
Holders of the Fourth 4i/4's now called for redemption on April 15, 1935,
may, in advance of that date, be offered the privilege of exchanging their thirdcalled bonds for other interest-bearing obligations of the United States, in
which event public notice will hereafter be given.
Full information regarding the presentation and surrender of Fourth 4i/4's
under this caU is given in Department Circular No. 525, dated October 12, 1934.
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
TREASURY DEPARTMENT, Washington, October 12, 1.934-

188

REPORT OF THE SECRETARY OF THE TE13ASUEY

The circular governing the redemption of these bonds was as follows:
[Department Circular No. 525]
TREASURY

DEPARTMENT,

Washington, October 12, 1934To i t older § of Fourth Liberty Loan 4>-/^ percent Bonds of 1933-38, and Others
Concerned:
I . NOTICE

OF T H I R D CALL FOR PARTIAL REDEMPTION BEFORE M A T U R I T Y OF
L I B E R T Y L O A N 4 l ^ PERCENT BONDS OF 19 3 3 - 3 8 ( F O U R T H 4 ^ / 4 ' S ) ^

FOURTH

1. All outstanding Fourth Liberty Loan 4^4 percent bonds of 1933-38 (Fourth
4i/i's) bearing serial numbers the final digit of which is 5, 6, or 7 (such
serial numbers in the case of permanent coupon bonds being prefixed by the
corresponding distinguishing letter E, F, or G, respectively),'are hereby called
?or redemption on April 15, 1935, on which date interest on such bonds called
-lor redemption will cease.
2. This third call for partial redemption is made pursuant to the provision
^or redemption contained in the bonds and in Treasury Department Circular
No. 121, dated September 28, 1918, under which the bonds were originally issued,
Ihe bonds to be redeemed having been determined by lot in the manner prescribed by the Secretary of the Treasury.
3. Outstanding Fourth 4i/4's bearing serial numbers (and prefix letters) other
than those designated are not included in or affected by this third call for
partial redemption,
I I , TRANSACTIONS

I N THIRD-CALLED

AND UNCALLED

BONDS

1. The bonds included in the third call for partial redemption on April 15,
1935, are hereby designated third-called Fourth 4^/4's.
2. The Treasury Department and the Federal Reserve banks, as fiscal agents
of the United States, will observe the division of Fourth 4i/4's into four classes,
first-called, second-called, third-called, and uncalled bonds.^ Hereafter, in all
transactions affecting third-called and uncalled Fourth 4 ^ ' s : (1) Only bonds
falling within the class third-called will be issued upon exchange or transfer
of third-called bonds, and (2) only bonds falling within the class uncalled
will be issued upon exchange or transfer of uncalled bonds. Exchanges or
transfers as between third-called and uncalled Fourth 4^/4's will not be permitted. Denominational exchanges of coupon bonds within the class thirdcalled will terminate on April 15, 1935. Transfers and exchanges of registered
bonds within the class third-called will terminate on March 15, 1935, the date
of the closing of the transfer books. .
3. Pursuant to the provisions of Treasury Department Circular No. 121,
dated September 28, 1918, the provisions, of .Treasury Department Circular
No. 300, dated July 31, 1923, prescribing regulations with respect to United
States bonds and notes, as modified by Department Circulars No. 501, dated
October 12, 1933, and No. '509, dated AprU 13, 1934, are further modified to
accord with the provisions of paragraph 2 of this section.
III. PAYMENT

EXCHANGE

1. Payment of third-called bonds on April 15, 1935.—Holders of third-called
Fourth 4iy4's will be entitled to have such bqnds redeemed and paid at par
1 F o u r t h 4%'s (temporary coupon, permanent coupon, and registered) are numbered
serially beginning with no. 1 for each denomination ; in the case of permanent coupon
bonds each serial number is prefixed by a distinguishing letter, the letters A to K
(omitting I) being used, which letters, in order, r o t a t e w i t h and correspond to the final
digits 1 to 0, respectively.
'2 First-called F o u r t h 414's (called for redemption on Apr. 15, 1934.—Department Circular No. 501, dated Oct. 12, 1933) bear serial numbers endiner in 9, 0, or 1 (in the
case of permanent coupon bonds preceded by the distinguishing l e t t e r J, K, or A,
respectively) : second-called F o u r t h 4Vt/s (called for redemption on Oct. 15. 1934—
D e p a r t m e n t Circular No. 509, dated Apr. 13, 1934) bear serial numbers ending in 8 or
2 (in the case of permanent coupon bonds prece.de.di by t h e , distin.guishine letter H or
B, resp-ectively) ; third-called F o u r t h 4V)'s (called fo"r redemption on Apr. 15. 1935) bear
s e r i a l numbers ending in 5. 6. or 7 (in the case of permanent coupon bond?: precpded
by the distinguishing letter E. F , or G, respectively) ; and uncalled F o u r t h 4i/4's bear serial
numbers ending in 3 or 4 (in t h e case of p e r m a n e n t coupon bonds, preceded by the
distinguishing letter C or D, respectively).

REPOET OF THE SECEETAEY OF THE TEEASURY

189

on AprU 15, 1935, with interest in full to that date. After AprU 15, 1935, interest will not accrue on any such bonds included in the third call for partial
redemption. (Instructions for presentation of such third-called bonds for
redemption on Apr. 15, 1935, are set forth in sees. IV and V of this circular.)
2. Optional exchange offering.—Holders of third-called Fourth 4i^'s may, in
advance of April 15, 1935, be offered the privilege of exchanging all or any
part of their third-called bonds for other interest-bearing obligations of the
United States, in which event due public notice will be given. Holders who
desire to avail themselves of any exchange privilege, if and when offered,
should watch for an announcement thereof, and should request their bank
or trust company to notify them when information regarding any exchange
offering is received. (In case of an exchange offering, instructions then given
in the public announcement should be followed in presenting third-called bonds
for exchange.)
IV. REDEMPTION OF THIRD-CALLED FOURTH 4 l ^ ' S

1. Presentation and sun^ender of coupon bonds.—Third-called Fourth 4%'s
in coupon form should be presented^and surrendered to any Federal Reserve
bank or branch, or to the Treasurer of the United States, Washington, D. C,
for redemption on April 15, 1935. The bonds must be delivered at the expense
and risk of holders (see par. 7 of this section) and should be accompanied
by appropriate written advice (see form P. D. 1416 attached hereto). Checks
in payment of principal will be mailed to the address given in the form of
advice accompanying' the bonds surrendered.
2. Coupons dated April 15, 1935, which become payable on that date, should
be detached from any third-called Fourth 414's before such borids are presented
for redemption on April 15, 1935, and such coupons should be collected in
regular course when due. All coupons pertaining to such bonds bearing dates
subsequent to April 15, 1935, must be a:ttached to such bonds when presented
for redemption, provided, however, if any such coupons are missing from
bonds so presented for redemption the borids nevertheless will be redeemed,
but the full face amount of any such missing coupons will be deducted from
the payment to be made on account of such redemption, and any amounts so
deducted will be held in the Treasury to provide for adjustments or refunds
on acoount of such missing coupons as may subsequently be presented.^
3. Presentation and surrender of registered bonds.—Third-called Fourth 4i^'s
in registered form must be assigned by the registered payees or assigns thereof, or by their duly constituted representatives, in accordance with the general
regulations of the Treasury Department governing assignments, in the form
indicated in the next paragraph hereof, and should thereafter be presented and
surrendered to any Federal Reserve bank or branch, or to the Division of Loans
and Ctirrency, Treasury Department, Washington, D. C, for redemption on
April 15, 1935. The bond^ must be delivered at the expense and risk of holders
(see par. 7 of this section) and should be accompanied by appropriate written
advice (see form P. D. 1417 attached hereto). In all cases checks in payment
of principal will be mailed to the address given in the form of advice
accompanying the bonds surrendered.
4. If the registered holder of record, or an assignee holding under proper
assignment from the registered holder of record, or a duly constituted representative of such registered holder or assignee, desires that payment of the
principal be made to him, the bonds should be assigned to " The Secretary of
the Treasury for redemption." In case it is desired to have payment of the
registered bonds made to someone other than the registered holder of record,
without intermediate assignment, the bonds may be assigned to " The Secretary of the Treasury for redemption for account of
" and in such case
the name and address of the payee for whose account the redemption is to be
made must be inserted. Assignments in this form must be completed before
acknowledgment and not left in blank.
3 The final coupon attached to temporary coupon bonds became due on Oct. 15, 1920.
The holders of any such temporary bonds whicii are included in the third call for
p a r t i a l redemption on Apr. 15, 1935, will receive all past-due interest from Oct. 15, 1920.
when the bonds are redeemed pursuant to such call. Any coupons now attached to any
such temporary bonds should be detached and collected in regular course.

190

REPORT OF THE SECRETARY OF THE TREASURY

5. Assignment in blank, or other assignment having similar effect, will be
recognized, but in that event payment will be made to the person' surrendering
the bond for redemption, since under such assignment the bond becomes in
effect payable to bearer. Assignments in blank or assignments having similar
effect should be avoided, if possible, in order not to lose the protection afforded
by registration.
6. Final interest due on April 15, 1935, on any third-called Fourth 414's in
registered form will be paid by checks issued in regular course in the same
manner as if such bonds had not been called for redemption.
7. Transportation of bonds.—Bonds presented for redemption under this
circular must be delivered to a Federal Reserve bank or branch, or to the
Treasury Department, Washington, D. C, at the expense and risk of the
holder. Coupon bonds should be forwarded by registered mail, insured, or by
express, prepaid. Registered bonds bearing restricted assignments may be
forwarded by registered mail, but^ registered bonds bearing unrestricted assignments should be forwarded by registered mail, insured, or by express. Facilities
for transportation of bonds by registered mail, insured, may be arranged between
incorporated banks and trust companies and the Federal Reserve banks, and
holders may take advantage of such arrangements when available, utilizing
such incorporated banks and trust companies as their agents. Incorporated
banks and trust companies are not agents of the United States under this
circular.
**
V. T I M E

OF PRESENTATION

OF THIRD-OALLEiD

FOURTH

4%'s

FOR

REDEMPTION

1. In order to facilitate the redemption of third-called Fourth 4iy4's on April
15, 1935, any such bonds may be presented and surrendered in the mariner herein prescribed in advance of that date but not before March 15, 1935. Such
early presentation by holders, on and after March 15, 1935, and well in advance
of April 15, 1935, will assure prompt payment of principal when due. This is
particularly important with respect to registered bonds, for payment cannot
be made until registration shall have been discharged at the Treasury
Department.
2. It will expedite redemption if bonds included in the third call for partial
redemption are presented to Federal Reserve banks or branches, and not direct
t!o the Treasury Department.
3. As hereinbefore provided: (1) Coupons due April 15, 1935, should be
detached from any permanent coupon bonds included in the third call for partial
redemption when such bonds are presented for redemption on that date, such
coupons to be collected when due; and (2) final interest due on any registered
bonds included in the third call for partial redemption will be paid by check
issued in regular course. Accordingly, early presentation of bonds will not
affect the payment of final interest due on April 15, 1935,
y i , GENERAL

PROVISIONS

1. Any further information which may be desired regarding the partial redemption of third-called Fourth 4i/4's under this circular may be obtained from
any Federal Reserve bank or branch, or from the Treasury Department, Washingtori, D, C, where copies of the Treasury Department's regulations governing
assignments may also be obtained.
^2, As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to perform any necessary acts under this circular. The Secretary of the Treasury may at any time, or from time to time, prescribe supplemental or amendatory rules and regulations gbverning the matters covered by
this circular, which will be communicated promptly to Federal Reserve banks.
• HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
IMPORTANT N O T E . — F o u r t h 43;4's called for redemption on Apr. 15, 1935. should be
presented well in advance of t h a t date but not before Mar. 15, 1935, and the instructions
given in this circular should be followed.
If an exchange opportunity is afforded, and
third-called F o u r t h ^M^'s are to be presented for exchange, the instructions given in
subsequent announcement should be followed. Information concerning the redemption of
third-called F o u r t h 4i^'s on Apr. 15, 1935, and information concerning an optional
exchange if and Avhen offered, may be obtained from the officers of banks and t r u s t
companies generally.
As those banks and t r u s t companies may offer their facilities
in the m a t t e r bf a r r a n g i n g redemption or exchange, it is suggested t h a t holders of
third-called F o u r t h 4i;4's consult their own bank or t r u s t company.

191

REPORT OF T H E SECRETARY OP T H E TREASURY
FOR COUPON BONDS
[Form P D 1416. F o r registered bonds use Form P D 1417]

F0R,M OF AD'VICB TO' ACCOMPANY THIRD'-CALLED' FOURTH LIBERTY LOAN 4^/4 PEOEBCENT B.ONDS (FOURTPI 4 % ' s ) IN COUPON FORM PRESEINTED' FOR R E D E I M P T I O N ON
A P R I L 15, 1935
T o t h e FEDERAL RESERVE B A N K OF

or
TREASURER OF T H E U N I T E D STATES, Washington, D. C :

P u r s u a n t to t h e provisions of T r e a s u r y D e p a r t m e n t Circular No. 525, dated
October 12, 1934, t h e undersigned presents a n d surrenders herewith for redemption on April 15, 1935, $
, face amount of third-called F o u r t h
Liberty Loan bonds in coupon form, with coupon d u e October 15, 1935, a n d all
subsequent coupons attached, as follows:
Denomination

Number of bonds

Face
amount

Serial numbers of bonds

$50
100
500
1,000
5,000
10,000
100.000
Total

a n d requests t h a t remittance covering payment therefor be forwarded to t h e
undersigned a t t h e address indicated below.
Signature
Name (please p r i n t )
Address in full
D a t e __..
FOR REGISTERED

BONDS

[Form P D 1417. P o r coupon bonds use form P D 1416]
F O R M OF A D V I C E TO ACCOMPANY T H I R D - C A L L E D F O U R T H L I B E R T Y L O A N 43^ P E R CENT BONDS ( F O U R T H 4 % ' S ) I N REGISTERED FORM PRESENTED FOR REDEMPTION
ON A P R I L 15, 1935
To t h e FEDERAL RESERVE B A N K OF

or
TREASURY DEPARTMENT, DIVISION OF LOANS AND CURRENCY,

Washington, D. C :
P u r s u a n t to t h e provisions of T r e a s u r y Department Circular No. 525, dated
October 12, 1934, t h e undersigned presents and surrenders herewith for redemption on April 15, 1935, $
, face amount of third-called F o u r t h Liberty
Loan bonds in registered form, inscribed in t h e name of
:
and duly assigned to " T h e Secretary of t h e
T r e a s u r y for redemption ", a s follows:
Denomination

Number of bonds

$50
100
500
1,000
5,000
10,000
50,000
100,000
Total
16816—36-

-14

Face
amount

Serial numbers of bonds

$ __

^«_

__ _

192

REPORT OF THE SECEETARY OF THE TREASUEY

and requests that remittance covering payment therefor be forwarded to the
undersigned at the address indicated below.
Signature
:
___
Name (please print)
Address in full
.
.
Date
Exhibit 4
Offering of SYs rtercent Treasury bonds of 1949-52, 1% percent Treasury notes
of series E-1936, and gi/^ perccui Treasurj notes of series A-1939 {additional)
On December 3, 1934, Secretary of the Treasury Morgenthau offered for subscription an issue of Treasury bonds and two issues of Treasury notes as described
in the following circulars. In the related press release it was stated that about
$99'2,490,5OO of maturing Treasury certificates of indebtedness and about $137,000,000 of interest on the public debt would be payable on December 15, 1934.
[Treasury bonds of 1949-52.

Department Circular No, 526]
TREASURY DEPART'MENT,

Washington, December 3, 1934OFFERING OF BONDS

The Secretary of the Treasury, pursuant to the authority of the Second Liberty
Bond Act, approved September 24, 1917, as amended, invites subscriptions, at
par and. accrued interest, from the people of the United States, for 3% percent
bonds of the United States; designated Treasury bonds of 1949^52, The amount
of the offering is $450,000,000, or thereabouts.
DESCRIPTION OF BONDS

The bonds will be dated December 15, 1934, and will bear interest from that
date at the rate of 3% percent per arinum, payable semiannually on June 15 and
December 15 in each year until the principal amount becomes payable. They
will mature December 15, 1952, but may be redeemed at the option of the United
States on and after December 15, 1949, in whole or in part, at par and accrued
interest, on any interest day or days, on 4 months' notice of redemption given in
such manner as the Secretary of the Treasury shall prescribe. In case of partial redemption the bonds to be redeemed will be determined by such methods
as may be prescribed by the Secretary of the Treasur>\ From the-date of
redemption designated in any such notice, interest on the bonds called for
redemption shalL cease.
The bonds shall be exempt, both as to principal and interest, from aU taxation
now or hereafter imposed by the United States, any State, or any of the possessions of the United States, or by any local taxing authority, except (a) estate
or inheritance taxes, and (b) graduated additional income taxes, commonly
known as surtaxes, and excess-profits and war-profits taxes, now or hereafter
imposed by the United States, upon the income or profits of individuals, partnerships, associations, or corporations. The interest on an amount of bonds authorized by the Second Liberty Bond Act, approved September 24, 1917, as amended,
the principal of which does not exceed $5,000, owned by any individual, partnership, association, or corporation, shall be exempt from the taxes provided for in
clause (b) above.
The bonds will be acceptable to secure deposits of public moneys, and will
bear the circulation privilege only to the extent provided in the act approved
July 22, 1932, as amended. They will not be entitled to any privilege of
conversion.
.. Bearer bonds with interest coupons attached, and bonds registered as to princinal and interest, wiU be issued in denominations. of $50, $100' $500, $1,000,
$5,000, $10,000, and $100,000. Provision wiU be made for the interchange of
bonds of 'different denominations and of coupon and registered bonds, and for
the transfer of registered bonds under rules and regulations prescribed by the
Secretary of the Treasury.

EEPOET OF THE SECEETAEY OF THE TEEASUEY

193

The bonds will be subject to the general regulations of the Treasury Department, now or hereafter prescribed, governing United States bonds.
APPLICATION A N D A L L O T M E N T

Applications will be received at the Federal Reserve banks and branches and
at the Treasury Department, Washington, Banking institutions generally will
handle applications for subscribers, but only the IB^ederal Reserve banks and
the Treasury Department are authorized to act as official agencies. Applications; unless made by an incorporated bank or trust company, must be accompanied by payment in full or by payment of 5 percent of the amount of bonds
applied for. The Secretary of the Treasury reserves the right to close the books
as to any or all subscriptions or classes of subscriptions at any time without
notice.
The Secretary of the Treasury reserves the right to reject any subscription,
in whole or in part, to allot less than the amount of bonds applied for, to make
allotments in full upon applications for smaller amounts and to make reduced
allotments upon, or to reject, applications for larger amounts, to make classified
allotments or to make allotments upon a graduated scale, or to adopt any of
all of said methods or such other methods of allotment and classification of
allotments as shall be deemed by him to be in the public interest; and his action
in any or all of these respects shall be final. Subject to these reservations, subscriptions for amounts up to and including $10,000 will be given preferred allotment, and all other subscriptions will be allotted on an equal percentage basis.
Allotment notices will be sent out promptly upon allotment, and the basis of
allotment will be publicly announced.
PAYMENT

Payment at par and accrued interest, if any, for bonds allotted hereunder
must be made or completed on or before December 15, 1934, or on later allotment. In every case where payment is not so completed, the 5 percent payment
with application shall, upon declaration made by the Secretary of the Treasury
in his discretion, be forfeited to the United States.. Any qualified depositary
will be permitted to make payment by credit for bonds allotted to it for itself
and its customers up to any amount for which it shall be qualified in excess of
existing deposits, when so notified by the Federal ReserA-e bank of its district.
GENERAL PROVISIONS

As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions^ * * *^
HENRY MORGENTHAU,

Jr.

Secretary of the Treasury.
[Treasury notes, series E—1936.

Department Circular No. 527]
TREASURY

DEPARTMENT,

Washington, December 3, 1934.
Tlie Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, offers for subscription, at par and accrued interest, IVs percent notes of the United States,
designated Treasury notes of series E-1936. The amount of the offering is
$450,000,000, or thereabouts, with the right reserved to the Secretary of the
Treasury to increase the offering by an amount sufficient to accept all subscriptions for which Treasury certificates of indebtedness of series TD-1934,
maturing December 15, 1934, are tendered in payment and accepted.
DESCRIPTION OF NOTES

The notes will be dated December 15, 1934, and will bear interest from that
date at the rate of IVs percent per annum, payable semiannually on June
15 and December 15 in each year. They will mature June 15, 1936, and will
not b esiibject to call for redemption prior to rnaturity.^ * * *
1 Omitted portion similar to corresponding section of Department Circular No. 524,
p. 184.
~ Omitted portions similar to corresponding sections of Department Circular No. 522,
p. 181.

194

REPORT OF T H E SECRETAEY OF T H E TREASURY
APPLICATION AND A L L O T M E N T

Applications will be received at the Federal Reserve banks and branches
and at the Treasury Department, Washington. Banking institutions generally
will handle applications for subscribers, but only the Federal Reserve banks
and the Treasury Department are authorized to act as official agencies. If
payment is to be made in cash, each application, unless made by an incorporated bank or trust company, must be accompanied by payment in full or by
payment of 5 percent of the amount of notes applied for. The Secretary of
the Treasury reserves the right to close the books as to any' or all subscriptions
or classes of subscriptions at any time without notice.
The Secretary of the Treasury reserves the right to reject any subscription,
in wliole or in part, to allot less than the amount of notes applied for, to
make allotments in full upon applications for smaller amounts and to make
reduced allotments upon, or to reject, applications for larger amounts, to make
classified allotments or to make allotments upon a graduated scale, or to
adopt any or all of said methods or such other methods of allotment and
classification of allotments as shall be deemed by him to be in the public
interest; and his action in any or all of these respects shall be final. Subject
to these reservations, cash subscriptions for amounts up to and including
$10,000 will be given preferred allotment, all other cash subscriptions will
be allotted on an equal percentage basis, and subscriptions in payment of which
Treasury certificates of indebtedness of series TD-1934 are tendered will be
allotted in full. Allotment notices will be sent out promptly upon allotment,
and the basis of allotment will be publicly announced.

Paymerit at par and accrued interest, if any, for notes allotted on cash subscriptions must be made or completed on or before December 15, 1934, or on
later aUotment. In every case where payment is not so completed, the 5 percent payment with application shall, upon declaration made by the Secretary
of the Treasury in his discretion, be forfeited to the United States. Any
qualified depositary will be permitted to make payment by credit for notes
allotted on cash subscriptions to it for itself and its customers up to any
amount for which it shall be qualified in excess of existing deiposits, when so
notified by the Federal Reserve bank of its district. Treasury certificates
of indebtedness of series TD-1934, maturing December 15, 1934, will be accepted
at par in payment for any notes subscribed for and allotted and such payment
should be made when the subscription is tendered.
GENERAL PROVISIONS

As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions * * *.
HENRY MORGENTHAU, Jr,,

Secretary of the Treasury.
[Treasury notes, series A-1939.

Department Circular No. 528]
TREASURY

DEPARTMENT,

Washington, December 3, 1934.
The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, offers for subscription, at par, an additional amount of 2% ipercent notes of the Unitedr
States, designated Treasury notes of series A-1939, in payment of which
only Treasury certificates of indebtedness of series TD-1934, maturing December 15, 1934, may be tendered. The amount of the off'ering is limited to the
amount of Treasury certificates of indebtedness of series TD-1934 rendered
and accepted,
DESCRIPTION OF NOTES

The notes-now offered will be an addition to and will form a part of the
series of 2% percent Treasury notes of series A-1939 issued pursuant to
Department Circular No. 513, dated June 4, 1934, are identical in all respects

REPORT OF THE SECRETARY OF THE TEEASUEY

195

therewith (except that interest on the notes issued under this circular will
accrue from Dec. 15, 1934), will be freely interchangeable, and are described
in the following quotation from said circular no. 513:
" The notes will be dated June 15, 1934, and will bear interest from that
date at the rate of 2% percent per annum, payable semiannually, on December
15, 1934, and thereafter on June 15 and December 15 in each year. They will
mature June 15, 1939, and will not be subject to call for redemption prior to
maturity.
" The notes shall be exempt, both as to principal, and interest, from all
taxation (except estate or inheritance taxes) now or hereafter imposed by the
United States, any State, or any of the possessions of the United States, or
by any local taxing authority.
" The notes will be accepted at par during such time and under such rules
and regulations as shall be prescribed or approved by the Secretary of the
Treasury in paj^ment of income and profits taxes payable at the maturity
•of the notes.
" The notes will be acceptable to secure deposits of public moneys, but will
not bear the circulation privilege.
" Bearer notes with interest coupons attached will be issued in denominations of $100, $500, $1,000, $5,000, $10,000, and, $100,000. The notes win not be
issued in registered form."
As interest on the notes issued under this circular will accrue from December
15, 1934, notes will be delivered hereunder with coupon no. 1, dated December
15, 1934, detached.
APPLICATION

AND

ALLOTMENSF

AiDplications will be received at the Federal Reserve banks and branches
and at the Treasury Department, Washington, Banking institutions generally
will handle applications for subscribers, but only the Federal Reserve banks
and the Treasury Department are authorized to act as official agencies. The
Secretary of the Treasury reserves the right to close the books as to any or
.all subscriptions or classes of, subscriptions at any time without notice.
The Secretary of the Treasury reserves the right to reject any subscription,
in whole or in part, to allot less than the amount of notes applied for, to
make allotments in full upon applications for smaller amounts and to make
reduced allotments upon, or to reject, applications for larger amounts, to
make classified allotments or to make allotments upon a graduated scale,
or to adopt any or all of said methods or such other methods of allotment and
-classification of allotments as shall be deemed by him to be in the public
interest; and his action in any or all of these respects shall be final. Subject
to these reservations, all subscriptions will be allotted in full. Allotment
notices will be sent out promptly upon allotment.
PAYMENT

Payment at par for notes allotted hereunder must be made or completed on
•or before December 15, 1934, or on later allotment, and may be made only in
2.'Vt percent Treasury certificates of indebtedness of series TD-1984, maturing
December 15, 1934, which will be accepted at par, and should accompany the
subscription.
GENERAL

PROVISIONS

As fiscal agents of the United States, Federal Reserye banks are authorized
and requested to receive subscriptions^ * * *.
HENRY MORGENTHAU, Jr.,

Secretary of the Treasury.

Exhibit 5
Subscriptions and allotments, Treasury bonds of 1949-52 and Treasu/ry notes
of series E-1936 and series A-1939 {from press releases, Dec. 4^ 5, 7, and 12,
1934, revised'')
^ Omitted portion similar to corresponding section of Department Circular No. 522,
p. 181.
2 Eevised Jan. 4, 1935.

196

REPORT OP THE SECRETARY OF THE TEEASURY

On December 4, 1934, Secretary of the Treasury Morgenthau announced that
the subscription books for the cash offering of 3Vs percent Treasury bonds of
1949-52 closed at the close of business December 3, 1934. Reports received from
the Federal Reserve banks show that for this offering, which was for $450,000,000 or thereabouts, total subscriptions aggregated $2,334,467,500. Subscriptions
in amounts up to and including $10,000 were allotted in full and those in
amounts over $10,000 were allotted 18 percent but not less than $10,000 on any
one subscription.
The subscription books for the offering of 1% percent Treasury notes of
series E-1936 also closed at the close of business on December 3, 1934, for the
receipt of cash subscriptions, but remained open until the close of business
December 6, 1934, for the receipt of subscriptions for which payment was tendered in Treasury certificates of indebtedness of series TD-1934, maturing
December 15, 1934.
For the cash offering of Treasury notes of series E-1936, which was for
$450,000,000 or thereabouts, subscriptions aggregated $3,036,069,900. Cash
subscriptions in amounts up to and including $10,000 were allotted in full, and
those in amounts over $10,000 were allotted 14 percent, but not less than
$10,000 on any one subscription. Exchange subscriptions for the Treasury
notes of series E-1936 aggregated $210,132,500 and were allotted in full.
The subscription books for the offering of the additional issue of Treasury
notes of series A-1939, issued only in exchange for Treasury certificates of
indebtedness of series TD-1934, maturing December 15, 1934, closed at the
close of business December 6, 1934. Total subscriptions, amounting to $765,192,500, were aUotted in full.
Subscriptions and allotments for the three issues were divided among the
several Federal Reserve districts .and the Treasury as follows:
Treasury bonds of 1949-52
Federal Reserve district

Cash subscriptions received

Total subscriptions allotted

Treasury noteof series A-1939,
total exchange
subscriptions
received and
allotted

Boston
New York
Philadelphia..
Cleveland
Eichmond
Atlanta
Chicago
St. Louis.
Minneapolis..
Kansas City..
Dallas
San Francisco.
Treasury

$158,772, 550
1,153,531, lbo
150, 161, 660
133,854, 700
90, 110, 350
100, 158, 600
181,022, 750
60,931, 500
14,382, 400
51,402, 200
63, 126,100
176,982,'700
30,900

$33,113,600
224, 204, 500
30, 513, 500
29,059, 200
18. 586, 350
23,974, 600
42.919, 050
16,969,400
5, 577,400
14,302, 300
17. 223,200
34,903,100
30,900

$22, 706,000
473,903, 500
13,623,500
13.141, 500
54, 554,000
4, 696, 500
112,596.000
14,011,000
18, 679,000
13, 482,000
8,821, 500
12,168,000
2,810,000

Total...

2, 334. 467, 500

491, 377,100

765,192, 500

Treasury notes of series E-1936
Federal Eeserve district

Boston
New York
Philadelphia
Cleveland
Richmond..
Atlanta
. .
Chicago..
St. Louis
Minneapolis
Kansas City .
Dallas.
San Francisco
Treasury

subCash subscrip- Exchange
criptions retions received
ceived

...

Total

Total subscriptions received

Total cash
subscriptions
allotted

Total subscriptions allotted

$189, 587, 500
1, 450, 222,900
185, 565, 400
201, 292,000
132.939. 500
98,886, 900
287, 435, 900
72, 900, 300
52,846, 500
82,481,200
70,038, 300
211,861, 500
12,000

$10,375,000
148,868,000
1, 965, 500
2, 226, 500
2, 681, 500
77, 000
36,452,000
736, 500
1,081,000
2, 266,000
66. 000
3, 277, 500
60,000

$199, 962, 500
1, 599,090,900
187, 530, 900
203, 518, 500
135, 621, 000
98. 963, 900
323. «87.900
73. 036, 800
53. 927, 500
84, 747, 200
70.104, 300
215,139,000
72,000

$30, 603,000
214,282,000
27, 069, 400
29, 787,000
21,633,000
18, 233, 400
48, 616, 700
14, 322, 300
9, 479,000
16, 670, 200
14,108, 400
31, 667, 500
12,000

$40,978,000
363,150,000
29,034,900
32,013, 500
24, 314, 500
18,310, 400
85,068, 700
15, 058, 800
10, 560, 000
18,936. 200
14,174, 400
34,945,000
72,000

3,036,069,900

210.132, 500

3. 246, 202, 400

476,483,900

686,616,400

•

£•

EEPOET OP THE SECEETAEY OF THE TREASURY

197

Exhibit 6
Offering of United States Saving Bonds, series A
On March 1, 1935, the Secretary of the Treasury offered for sale, through the
Postal Service, United States Savings Bonds, series A, as described in the
following circular:
[Department Circular No. 529]
TREASURY DEDPARTMENT,

Washington, February 25, 1935.
OFFERING OF UNITED' STATES SAVINGS BONDS, SEIRIBS A

The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, offers for sale,
to the people of the United States, through the Postal Service, an issue of bonds
of the United States, designated United States. Savings Bonds, series A, which
will be issued on a discount basis, will mature in 10 years, but will be redeemable before maturity at the option of owners. Beginning March 1, 1935, tliese
bonds will be on sale at post offices of the first, second; and third classes and
at selected post offices of the fourth class, in amounts of $25 (maturity value)
and multiples thereof; and they will continue to be on sale until this offering
is terminated by notice given by the Secretary of the Treasury to the Postmaster General.
DESCRIPTION OF BONDS OFFERED

United States Savings Bonds, series A, will be issued only in registered form,
in denominations of $25, $50, $100, $500, and $1,0(X) (maturity value), at prices
hereinafter set forth, and will bear the name and address of the owner, the
date as of which issued, and the date of maturity, which on original issue shall
be inscribed thereon by the authorized postmaster at the time of issue. All.,
such Savings Bonds are to be dated as of the first day of the month in which
the issue price is received, and will mature and be payable 10 years from such
issue date. They may be redeemed prior to maturity (but not within 60 days
after the issue date), at the owner's option, in accordance with the table of
redemption values appearing at the end of this circular, and set forth on the
face of each bond. No interest will be paid on Savings Bonds, but the purchase
price has been fixed so as to afford an investment yield of about 2.9 percent
per annum compounded semiannually if the bonds are held to maturity. If
the owner exercises his option to redeem his bond prior to maturity the yield
will be less, varying with the respective redemption values.
The Savings Bonds will not be transferable,., and will be payable only to the
ov^rier named thereon, except in case of death or disability of the owner or
as a result of judicial proceedings, and then only in accordance with regulations
prescribed from time to time by the Secretary of the Treasury. (See Treasury
Department Circular No, 530, dated Feb. 25, 1935.) Savings Bonds issued
through a post office shaU be valid only if inscribed with the owner's name and
address, dated the first day of the month in which the issue price is received,
and duly delivered by an authorized postmaster; they will bear the facsimile
signature of the Secretary of the Treasury, the seal of the Treasury Department will be impressed thereon, and they will bear the post-office dating stamp.
The Savings Bonds shall be exempt, both as to principal and interest, from all
taxation now or hereafter imposed by the United States, any State, or any
of the possessions of the United States, or by any local taxing authority, except
(a) estate or inheritance taxes, and (b) graduated additional income taxes,
commonly known as surtaxes, and excess-profits and war-profits taxes, now or
hereafter imposed by the United States, upon the income or profits of individr
uals, partnerships, associations, or corporations. The interest on an amount
of bonds authorized by the Second Liberty Bond Act, approved September 24,
1917, as amended, the principal of which does not exceed in the aggregate
$5,000, owned by any individual, partnership, association, or corporation, shall

198

REPORT OF THE SECRETARY OF THE TREASURY

be exempt from the taxes provided for in clause (&') above. For the purposes
of determining taxes and tax exemptions, the increment in value of Savings
Bonds represented by the difference between the price paid and the redemption
value received (whether at or before maturity) shall be considered as interest.
,

PURCHASE

Savings Bonds of series A may be purchased for cash, at post offices of the
first, second, and third classes, and at selected post offices of the fourth class,
at any time while this offer is in effect; and, subject to regulations prescribed
'by the board of trustees of the Postal Savings System, the withdrawal of postal
savings deposits, without loss of interest, will be permitted for the purpose of
acquiring S.avings Bonds. The issue prices of the various denominations of these
bonds follow:
Denomination (maturity value)

$25
50
100
500
1, 000

Issue price

^
,

$18.75
37. 50
75'. 00
375.00 , .
750. 00

It shall not be lawful for any one person at any one time to hold Savings
Bonds issued during any one calendar year in an aggregate amount exceeding
$10,000 (maturity value).
DELIVERY AND S A F E K E E P I N G OF BONDS

Postmasters from whom Savings Bonds may be purchased are authorized to
deliver such bonds duly inscribed and dated upon receipt of the purchase- price.
Deliveries should not be accepted by any purchaser until he has verified that
his name and address are duly inscribed on the face of the bond and that the
bond is duly dated the first day of the month in which he made payment of"
the purchase price.
Any Savings Bonds will be held in safekeeping by the Secretary of the Treasury if the purchaser so desires, and in this connection the Secretary will utilize
the facilities of the Federal Reserve banks as fiscal agents of the United States.
The purchaser may arrange for such safekeeping at the time he purchases his
bond or subsequently. Postmasters generally will assist owners in arranging
for safekeeping, but will not act as safekeeping agents.
P A Y M E N T A T M A T U R I T Y OR ON REDEMPTION PRIOR TO M A T U R I T Y

Payment of any Savings Bond in accordance with its terms at maturity, or at
the appropriate redemption value prior to rnaturity (but not within 60 days after
the issue date), will be made following presentation and surrender of the bond,
by registered mail or otherwise, at the expense and risk of the owner, to the
Treasury Department, Division of Loans and Currency, Washington, D. C, or
to any Federal Reserve bank, with the request for payment appearing on the
back of the bond duly executed by the owner and certified by any United States
postmaster from whom United States Savings Bonds may be purchased (authenticated by the imprint of his post-office dating stamp), by an executive officer
of an incorporated bank or trust conipany (authenticated by the impress of the
corporate seal of the bank or trust company), or by any other person duly designated by the Secretary of the Treasury for the purpose. Payment will be made
by check drawn to the order of the owner, promptly after discharge of registration at the Treasury Department. In case of the death or disability of the
registered owner, instructions should be obtained from the Treasury Department,
Division of Loans and Currency, Washington, D. C, before the request for payment is executed. Postmasters generally will assist holders in securing payment at or before maturity, but they will not make payment of Savings Bonds.

199

REPORT OF THE SECRETARY OF THE TREASURY
GENERAL PROVISIONS

All bonds issued pursuant to this circular shall be subject to regulations prescribed from time to time by the Secretary of the Treasury. Such regulations
may require, among other things, reasonable notice in case of presentation of
Savings Bonds for redemption prior to maturity. The initial regulations governing Savings Bonds are contained in Treasury Department Circular No. 530,
dated February 25, 1935.
The Secretary of the Treasury may designate agencies other than post offices
for the sale of Savings Bonds of this series, and he reserves the right to refuse
to issue or permit to be issued hereunder any such Savings Bonds in any case or
class of cases if he deem such action to be in the public interest. The Secretary
of the Treasury further reserves the right to terminate this offer at any time,
on notice to the Postmaster General.
^
Postmasters of the first, second, and third classes, and selected postmasters
of the fourth class, under regulations promulgated by the Postmaster General,
and Federal Reserve banks, as fiscal agents of the United States, are authorized
to perform such fiscal agency services as may be requested of them in connection
with the issue, delivery, safekeeping, redemption, and payment of Savings Bonds.
The Secretary of the Treasury may at any time or from time to time supplement or amend the terms of this circular, information as to which will bei
promptly furnished to the Postmaster General and to Federal Reserve banks.
HENRY MORGENTHAU,

Jr.,

Secretari/ of the Treasury.
Table showing how United States Savings Bonds of series A increase in value
during successive half-years following issue:
Maturity value.
Issue price

$25.00
18.75

$50.00
37.50

$100
75

$500
375

$1,000
750

75
76
77
78
79
- 80
81
82
83
84
85
86
87
88
90
92
94
96
98
100

375
380
385
390
395
400
405
410
415
420
425
430
435
440
450
460
470
480
490
500

750
760
770
780
790
800
810
820
830
840
850
860
870
880
900
920
940
960
980
1,000

Redemption values after the issue date
First year
1 to IH years..
iy2 to 2 years..
2 to 2H years..
2}4 to 3 years..
3 to 3H years..
3H to 4 years..
4 to 4H years..
4J^ to 5 years..
6 to 5H years..
6Hto 6 years..
6 to 6H years..
6M to 7 years..
7 to 7H years..
7H to 8 years..
8 to 8M years.8H to 9 years..
9 to 9H years..
9H to 10 years..
IVIaturity value

18.75
19.00
19.25
19.50
19.75
20.00
20.25
20.50
20.75
2L00
2L25
2L50
2L75
22.00
22.50
23.00
23.50
24.00
24.50
25.00

37.50
38.00
38.50
39.00
39.50
40.00
40.50
41.00
41.50
42.00
42.50
43.00
43.50
44.00
45.00
46.00
47.00
48.00
49.00
50.00

Exhibit 7
Sales of United States Samngs Bonds from March 1 to June 30, 1935 {from
press releases, July 15 and Aug. 12, 1933 ^)
Amounts collected from sales of United States Savings Bonds during the first
4 months the bonds were on sale amounted to $96,365,588. As these bonds
are sold on a discount basis and increase in 10 years, through accumulated
interest, by 33% percent, these sales represent a maturity value of $128,487,450.
Amounts collected by States, arranged in order of their total sales for the 4
months, were:
1 Revised.

200

REPORT OF THE SECRETARY OF THE TREASUEY

Amounts collected from sales of United States Savings Bonds, by States and by
months,^ March 1 to June 30, 1935

M a r c h 1935

state
Illinois
New York
Ohio
Mi.^^vSouri
Iowa
Pen nsy 1 vania
^Kansas
Minnesota..
Michigan.
Texas
Indiana
Wisconsin
Galifornia.
Nebraska.--.,-'
Massachusetts.
Kentucky...
Oklahoma
N o r t h Carolina
N e w Jersey
W e s t Virginia
Washington..
D i s t r i c t of C o l u m b i a
Tennessee
Virginia
Florida
Oregon..
Colorado
North D a k o t a . . .
Montana
Georgia
South Dakota
Marj^land
Ai'kansas
..Louisiana
Mississippi
S o u t h Carolina
Alabama
Connecticut
Maine
Idaho
E h o d e Island
N e w Mexico
Utah
Arizona.._
New Hampshire
Wyoming
Vermont
Nevada
Delaware
Hawaii
Alaska—P u e r t o Eico
Virgin Islands

....

T o t a l cash r e c e i p t s . .
M a t u r i t y value

101,131. 25
210, 356. 25
550, 262. 50
248, 968. 75
960, 050. 00
792, 500. 00
457,775. 00
646,306. 25
118,131. 25
052, 525. 00
296,956. 25
966, 825. 00
313,137. 50
260; 800. 00
826,818.75
714, 656. 26
569, 006. 25
743,362. 50
638,325. 00
397, 368.75
403, 631. 25
376,425. 00
567,468. 75
465,450. 00
455,850. 00
383, 531. 25
413,118.75
248,718.75
421, 293. 75
281,456.25
226, 725. 00
386,137.50
327,-956..25
329, 062. 50
216,900.00
175, 856. 25
193, 031. 25
178,443. 75
117,- 506. 25
88,125. 00
106, 087. 50
113, 512. 50
106,931.25
70, 856. 25
70,143. 75
75,131. 25
55, 031. 25
36, 356. 25
28,- 837. 50
6, 318. 75
4, 668. 75
4, 068. 75
356. 25
38, 799, 750. 00
51, 733, 000. 00

^ O n t h e b a s i s of post-office

April 1935

May 1935

J u n e 1935

Total. March 1
to J u n e 30,
1935

$2, 243, 775. 00 $1, 392,750. 00 $1,411, 631.25
050. 00
2, 003, 025. 00
934, 818. 75
,241, 887. 50
1, 736, 868. 75
1, 091,718.75
1, 638, 037. 50
1,429, 106. 25
, 095, 318. 75
1, 377, 881. 25
1, 791,243.75
963, 187. 50
1,123, 968. 75
863, 718. 75
910, 631. 25
1,133, 081. 25
852, 243. 75
850, 443. 75
1, 519, 575. 00
844, 875. 00
649, 987. 50
807, 093.75
679, 556. 25
753, 243.75
913, 312. 50
587, 325. 00
470, 118. 75
1, 041, 281. 25
864, 318.75
663, 993.75
671, 531. 25
675, 468. 75
867, 693. 76
681, 281: 25
420, 075. 00
546, 937. 50
• 653, 475. 00
• 595,
-256.25
442, .368.75
321, 412;-50
271, 068.75
232, 275.00
354, 431. 25
276, 131. 25
257, 343. 75
325, 593.75
312, 900. 00
314, 550. 00
368, 287. 50
220, 875. 00
168, 056. 25
168, 056. 25
242, 306. 25
310. 462.50
329, 493.75
261, 731. 25
326, 493. 75
297, 881. 25
249, 506. 25
305, 081. 25
233, 437. 50
369, 618.75
215, 681. 25
149, 793. 75
140, 025. 00
231, 7.87. 50
197, 868. 75
178, 518. 75
228, 975. 00
169, 556. 25
184, 593: 76
234, 056. 25
166, 650. 00
208, 481. 25
244, 293. 75
145, 050. 00
110, 025. 00
307, 443. 75
183, 318.75
173, 118.75
274, 125. 00
102, 581. 25
136, 150. 00
185, 400. 00
230, 793. 75
96, 375. 00
196, 106. 25
207, 150. 00
124, 031. 25
215, 625. 00
114, 618. 75
100, 218.75
144, 037. 50
• 155,
831.25
65; 606: 25
182, ;981..25
105, 508. 25
89, 512. 50
143, 305. 25
104, 456. 25
89, 231. 25
155, 418. 75
117, 937. 50
81, 712. 50
117, 225. 00
63,187.60
65, 718.75.
133, 256. 25
66, 300. 00
47, 175. 00
92, 418.75
51, 768. 75
59, 231. 25
72, 675. 00
51, 487. 50
33, 168. 75
107, 137. 50
47, 418.75
35, 343. 75
64, 106. 25
33, 543. 75
50, 943. 75
50, 981. 25
38, 381. 25
28, 631. 25
60, 318.75
26, 737.50
42, 318. 75
61, 950. 00
30, 450. 00
33, 975. 00
49, 706. 25
55, 088. 75
35, 625.00
16, 631. 25
21, 281. 25
50, 100. 00
15, 356. 25
29, 737. 50
17, 700. 00
13, 068. 75
4, 668. 75
19, 856. 25
3, 562. 50
11, 512. 50
6, 187. 50
5, 662. 60
10, 968. 75
10, 087. 50
3, 205. 25
11, 568. 75
7, 031. 25
2, 531. 25
375.00
160. 00
243. 7523,767,293.75 17, 837, 756. 25
31, 689, 725. 00 23, 783, 675. 00

r e p o r t s , s u b j e c t tO' a d j u s t m e n t ,

16,960, 787. 50
21, 281, 050. 00

$9,149, 287. 50
6,935, 260. 00
6,620, 737. 50
6, 411, 431. 25
6, 092, 362.50
4, 690, 818. 75
4, 293, 543. 75
4, 660, 743.75
4, 358, 026. 00
4, 023, 281.25
3, 839, 650.00
3,181, 518.75
2, 961, 431. 25
2,951, 40p.00
1,651,-'575:00
1, 602, 562. 50
1, 522, 050.00
1, 500, 581. 25
1, 359, 150. 00
1, 315, 087. 50
1, 256, 100.00
1,195, 162. 50
1, 089, 075.00
1, 070, 812. 50
1, 044, 056. 25
1.002, 966.25
975, 637. 50
879, 281. 25
844, 425.00
804, 731. 25
773, 531. 26
745, 012. 50
732; 376. 00
667, 387. 60
566, 006. 26
492, 731. 25
455, 193. 75,
384, 337. 50
301, 181. 25
279. 918.75
262, 956. 25
248, 981. 25
234, 262. 50
201, 862. 60
184, 275.00
182, 456. 25
141, 768.75
96, 862. 50
56, 925.00
29, 681. 25
28, 931. 25
25, 200.00
1, 125.00
96, 365, 587. 50
128, 487,450. 00

see note p. 24.

Exhibit 8
Offering of 2% percent Treasury bonds of 1955-60 and 1% percent Treasury
notes of series A-1940
On March 4, 1935, the Secretary of the Treasury announced an offering of
2% percent Treasury bonds of 1955-60 in exchange for Fourth Liberty Loan
41/4 percent bonds called for redemption on April 15, 1935 (third call) and an
offering of 1% percent Treasury notes of series A-1940 in exchange tor 2i^
percent Treasury notes of series C-1935, maturing March 15, 1935. In the related press release it was stated that about $1,870,000,000 of Fourth Liberty

EEPOET OP THE SECRETARY OP THE TREASURY

201

Loan bonds were included in the third call for redeinption, on April 15, 1935,
and that about $528,000,000 of Treasury notes of series 0-1935 were to mature
on March 15, 1935.
[Treasury bonds of 1955-60.

Department Circular No. 531]
TREASURY

DEPARTMENT,

Washington, March 4, 1935.
The Secretary of the Treasury, pursuant to the authority of the Second Liberty Bond Act, approved September 24, 1917, as amended, for refunding purposes, invites subscriptions from the people of the United States for 2ys
percent bonds of the United States, designated Treasury bonds of 1955-60, in
payment of which only Fourth Liberty Loan 4Vi: percent bonds of 1933-38
included in the third call for redemption on April 15, 1935 (hereinafter referred to as third-called Fourth 4i^'s) may be tendered.^ Treasury bonds of
1955-60 will be issued at par and accrued interest, if any, and third-called
Fourth 4Vi:'s will be received in payment at par, with an adjustment of accrued interest as of March 15, 1935, on the third-called Fourth 4Vi:'s so received.
The amount of the offering will be limited to the amount of third-called
Fourth 41/4's tendered and accepted. Fourth Liberty Loan bonds not included
in the third call for redemption on April 15, 1935, will not be accepted for
exchange under this circular.''
DESCRIPTION

BONDS

The bonds will be dated March 15, 1935, and will bear interest from that date
at the rate of 2% percent per annum, payable semiannually, on September
15, 1935, and thereafter on March 15 and September 15 in each year until
the principal amount becomes payable. They will mature March 15, I960, but
may be redeemed at the option of the United States on and after March 15,
1955, in whole or in part, at par and accrued interest, on any interest day or
days, on 4 months' notice of redemption given in such manner as the Secretary
of the Treasury shall prescribe. In case of partial redemption the. bonds to be
redSeemed will be determined by such method as may be prescribed by the
Secretary of the Treasury. From the date of redemption designated in any
such notice, interest on the bonds called for redemption shall cease.
The bonds shall be exempt, both as to principal and interest, from all taxation now or hereafter imposed by the United States, any State, or any of tiu.*
possessions of the United States, or by any local taxing authority, except (a)
estate or inheritance taxes, and (b) graduated additional income taxes, commonly known as surtaxes, and excess-profits and war-profits taxes, now on
hereafter imposed by the United States, upon the income or profits of individuals, partnerships, associations, or corporations. The interest on an amount
of bonds authorized by the Second Liberty Bond Act, api^roved September 24,
1917, as amended, the principal of which does not exceed in the aggregate $5,000,
owned by. any individual, i>artnership, association, or corporation, shall be
exempt from the taxes provided for in clause (b) above.
The bonds will be acceptable to secure deposits of public moneys, and will
bear the circulation privilege only to the extent provided in the act approved
July 22, 1932, as amended. They will not be entitled to -any privilege of conversion.
Bearer bonds with interest coupons attached, and bonds registered as to
principal and interest, will be issued in denominations of $50, $100, $500, $1,000,
$5,000, $10,000, and $100,000. Provision wiU be made for the interchange of
bonds of different denominations and of coupon and registered bonds, and for
the transfer of registered bonds under rules and regulations prescribed by the
Secretary of the Treasury.
1 P u r s u a n t to the t h i r d call for pai'tial redomption (see Department Circular No. 525,
dated Oct. 12, 1934) all o u t s t a n d i n g Foui'th Liberty Loan 41^, percent bonds of 1933-38
bearing serial numbers ending in 5, 6, or 7 (in the case of permanent coupon bonds
preceded by the distinguishing letter E, F, or G, respectively) have been called for redemption on Apr. 15, 1935, on which date interest on such bonds will cease.
-First-called F o u r t h 4i/4's (which ceased to bear interest on Apr, 15, 1934) bear serial
numbers ending in 9, 0, or 1 (in -the case of permanent coupon bonds preceded by *-he
distinguishing letter J, K, or A, respectively), second-called F o u r t h 414's (which ceased
to bear interest on Oct. 15, 1934) bear serial numbeJ's ending in 2 or 8 (in the case
of permanent coupon bonds preceded by. the distinguishing letter B or H, respectively), and
uncalled F o u r t h 414's bear serial numbers ending in 3 or 4 (in the case of permanent
coupon bonds preceded by the distinguishing letter C or D, respectively).

202

REPORT OP THE SECRETARY OP THE TREASURY

The bonds will be subject to the general regulations of the Treasury Department, now or hereafter prescribed, governing United States bonds,
APPLICATION

AND

ALLOTMENT

Applications will be received at the F,ederal Reserve banks and branches and
at the Treasury Department, Washington, Banking institutions generally will
handle applications for subscribers, but only the Federal Reserve banks and
the Treasury Department are authorized to act as official agencies. The Secretary of the Treasury reserves the right to close the books as to any nr all subscriptions or classes of subscriptions at any time without notice * * *.^
Subject to these reservations, all subscriptions w:'ll be allotted in fulL
Allotment notices will be sent out promptly upon allotment.
T E R M S OF P.AYMENT

Payment at par and accrued interest, if any, for bonds allotted hereunder
must be made or completed on or before March 15, 1935, or on later allotment,
and may be made only in third-called Fourth 4i^'s, w:iich will be accepted at
par with an adjustment of accrued interest thereon as of March 15, 1935, and
should accompany the subscription. If any subscription is rejected, in whole
or in part, the third-called Fourth 4i/4's tendered therewith and not accepted
will be returned to the snbscriber.
Coupon bonds.—Third-called Fourth 4V:'s in coupon form tendered in payment should have coupons dated April 15, 1935, as well as all subsequent coupons attached, and accrued interest from October 15, 1934, to March 15, 1935,*
will be paid to the subscribers.
Registered bonds.—As checks for interest covering the full 6-month period
from October 15, 1934, to April 15, 1935, will be issued on April 15, 1935, to
holders of record on March 15, 1935, of third-called Fourth 4V:'s in registered form, tenders of such registered bonds hereundcir must be accompanied
by payment of an amount equal to the interest to acci'ue thereon from March
15 to April 15, 1935.'
SURRENDER OF THIRD-CALLED F O U R T H 4 i ' S ON

EXCHANGE

Coupon bonds.—Third-called Fourth 4Vt's in coupon form tendered in exchange for Treasury bonds offered hereunder, should be presented and surrendered to a Federal Reserve bank or to the Treasurer of the United States,,
and should accompany the application. Coupons dated April 15, 1935, and
all coupons bearing dates subsequent to April 15, 1935, should be attached to
such coupon bonds when surrendered, and if any such coupons are missing^
the application must be accompanied by cash payment equal to the face amount
of the missing coupons," The bonds must be delivered at the expense and
risk of the holder. Facilities for transportation of bonds by registered mail
insured may be arranged between incorporated banks and trust companies
and the Federal Reserve banks, and holders may take advantage of such arrangements when available, utilizing such incorporated banks and trust companies as their agents. Incorporated banks and trust companies are not agents
of the United States under this circular.
Registered bonds.—Third-called Fourth 4V:'s in registered form tendered
in exchange for Treasury bonds offered hereunder should be assigned by the
registered payee or assigns thereof in accordance with the general regulations
of the Treasury Department governing assignments for transfer or exchange
in one of the forms hereafter set forth, and thereafter should be presented and
surrendered with the application to a Federal Reserve bank or to the Treasury
Department, Division of Loans and Currency, Washington. The bonds must
8 Omitted portions similar to corresponding sections of Department Circular, No. 526,
p. 192.
4 Accrued interest a t 4'/i percent from Oct. 15, 1934 to Mar. 15, 1935, on $1,000
third-called F o u r t h 414's (151 days) is $17.6304945,
5 Interest from Mar, 15 to Apr. 15, 1935, on $1,000 third-called F o u r t h 414's (31 days)
is $3.6195055.
« T h e final coupon attached to temporary coupon bonds became due on Oct. 15, 1920.
The holders of any such temporary bonds which are included in the t h i r d call for
p a r t i a l redemption on Apr. 15, 1935, will receive the past due interest from Oct, 15.
1920,' if such bonds are tendered for exchange under this circular.

REPORT OF THE SECRETARY OP THE TREASURY

203

be delivered at the expense and risk of the holder. If Treasury bonds are
desired registered in the same name as the third-called Fourth 4V:'s surrendered, the assignment should be to *' The Secretary of the Treasury foT
exchange for Treasury bonds of 1955-60 "; if Treasury bonds are desired registered in another name, the assignment should be to " The Secretary of
the Treasury for exchange for Treasury bonds of 1955-60 in the name
of
"; if Treasury bonds in coupon form are desired, the
assignment should be to " The Secretary of the Treasury for exchange for
Treasury bonds of 1955-60 in coupon form to be delivered to
"
GENERAL PROVISIONS

As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions * * *.^
H E N R Y MORGENTHAU,

Jr.,

Secretary of the Treasury.
[Treasury notes, series A-1940.

Department Circular No. 532]
TREASURY DEPARTMENT,

Washington, March 4, 1935.
The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, invites subscriptions, at par, from the people of the United States, for 1% percent notes of the
United States, designated Treasury notes of series A-1940, in payment of
which only Treasury notes of series C-1935, maturing March 15, 1935, may
be tendered. The amount of the offering will be limited to the amount of
Treasury notes of series C-1935 tendered and accepted.
DESCRIPTION OF NOTES

The notes will be dated March 15, 1935, and will bear interest from that
date at the rate of 1% percent per annum, payable semiannually, on September 15, 1935, and thereafter on March 15 and September 15 in each year.
They will mature March 15, 1940, and will not be subject to call for redemption
prior to maturity.
The notes shall be exempt, both as to principal and interest, from all taxation (except estate or inheritance taxes) now or hereafter imposed by the
United States, any State, or any of the possessions of the United States, or by
any local taxing authority.
The notes will be accepted at par during such time and under such rules and
regulations as shall be prescribed or approved by the Secretary of the Treasury
in payment of income and profits taxes payable at the maturity of the notes.
The notes will be acceptable to secure deposits of public moneys, but will
not bear the circulation privilege.
Bearer notes with interest coupons attached will be issued in denominations
of $100, $500, $1,000, $5,000, $10,000, and $100,000. The notes will not be issued
In registered form.
APPLICATION A N D A L L O T M E N T

Applications will be received at the Federal Reserve banks and. branches
and at the Treasury Department, Washington. Banking institutions. generally
will handle applications for subscribers, but only the Federal Reserve banks
and the Treasury Department are authorized to act as official agencies. The
Secretary of the Treasury reserves the right to close the books as to any
or all subscriptions or classes of subscriptions at any time without notice.
The' Secretary of the Treasury reserves the right to reject any subscription,
in ^vthole or in part, to allot less than the amount of notes appUed for, to
make allotments in full upon applications for smaller amounts and to make
reduced allotments upon, or to reject, applications for larger amounts, to make
"^ Omitted portion similar to corresponding section of Department Circular No. 524,
p. 184.

204

REPORT OF T H E SECEETARY OP T H E TREASURY

Classified allotments or to make allotments upon a graduated scale, or to
adopt any or all of said methods or such other methods of allotment and
classificatiori of allotments as. shall be deenied ,by him to be in the public
interest; and his action in any or all of these respects shall be final. Subject
to these reservations, all subscriptions will be allotted in full. Allotment
notices will be sent out promptly upon allotment.
PAYMENT

Payment at par for notes allotted hereunder must be made or completed
on or before March 15, 1935, or on later allotments, and may be made only
in 2% percent Treasury notes of series C-1935, maturing March 15, 1935, which
will be accepted at par and should accompany the subscription.
GENERAL PROVISIONS

As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions ••• '•' *.^
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
Exhibit 9
Allotments on exchange subscriptions, Treasury bonds of 1955-60 and Treasury
notes of series A-1940 {press releases, Mar. 7, 9, 18, and 25, and Apr.
2, 1935)
The subscription books for the offering of Treasury notes of series A-1940
closed at the close of business March 8, 1935, and the subscription books for
the offering of Treasury bonds of 1955-60 closed at the close of business March
27, 1935. The amounts of these off'erings, which were entirely on an exchange
basis, were limited respectively to the amounts of Treasury notes of series O1935 and third-called Fourth 4V:'s tendered in payment and acceiDted. The
allotments for the two issues were divided among the several Federal Reserve
districts and the Treasury as follows:

Federal E e s e r v e
district

Boston
New York
Philadelphia
Cleveland
Eichmond
A tia n tfl
Chicago
St. Louis

- ••- - --

Treasury
b o n d s of
1955-60;

Treasury
n o t e s of
series
A-1940

$57,935,600
866, 580,450
82, 285,150
105, 287, 200
38,608, 500
18, 469,100
177, 354,850
• 46,750,000

$11,318,800
315.785.600
9, 349.000
14. 485.900
28,403, 700
7.574,. 100
67. 471. 200
7,159, 600

Treasury
b o n d s of
1955^60

Federal R e s e r v e
district

Minneapolis
Kansas City
Dallas
San F r a n c i s c o .
Treasury
Total

Treasury
notes of
series
A^1940

$21, 225, 900
38,765. 150
16.245.300
49,426,850
39, 088,600

$6, 680,100
8, 443,900
16, 634,000
20,445,900
1,132, 400

1, 558,022, 660

513,884, 200

Exhibit 10
CaU for redemption of 2 percent consols of 1930 and 3 percent Panania Canal
loan bonds of 1916^36 and 1918-38 on July 1 and August 1,1935, respectively
On March 9, 1935, the Treasury issued the following release:
Secretary of the Treasury Morgenthau announced today (Mar. 9) that
the 2 percent consols of 1930 would be called by the Treasury on March 11
for redemption on .July 1, 1935, and the 2 percent Panama Canal loan bonds
of 1916-36 and 1918-38 for redemption on August 1, 1935. About $600,000,5 Omitted portion
p. 181.

similar

to corresponding

section

D<-partment

Circular

No. 522,

REPORT OF THE SECRETARY OF THE TEEASURY

205

000 of the consols and about $75,000,000 of the Panama Canal bonds are now
outstanding. These bonds bear the circulation privilege.
In retiring these bonds, • the Treasury will make use of the free gold
resulting from the reduction in the weight of the gold dollar. The Treasury
proposes to issue to the Federal Reserve banks an amount of gold certificates
about equal to the bonds being retired. The gold certificates will be issued
under the authority of the Gold Reserve Act of 1934, and for every gold
certificate so issued there will be withdraAvn from the General Fund of the
Treasury and held as security an amount of gold equal to the gold certificates
so issued.
By a provision of the Federal Home Loan Bank Act, enacted July 22, 1932,
all bonds of the United States bearing an interest rate of 3% percent per
annum, or less, were given the circulation privilege for a period of 3 years.
This provision expires July 22, 1935. At that time, banks with circulating
notes outstanding under this temporary authorization will have to replace the
bonds, now serving as security, with lawful money to retire their outstanding
notes thus secured.
The retirement of the 2 percent consols and the 2 percent Panama Canal
bonds, and the expiration of the temporary authorization for issuance of
national bank notes against other bonds will accomplish a simplification of
the currency system through the elimination of national bank notes, an action
contemplated at the time of the passage of the Federal Reserve Act. More
than $500,000,000 of the bonds being called are now on deposit with the
Treasurer as security for this type of currency.
The Federal Reserve bank notes authorized as emergency currency in the
Emergency Banking Act of 1933 are now in process of retirement. National
bank notes will be retired as rapidly as they are presented to the Treasury.
It is expected that the great majority will be canceled within a year. This
will leave as permanent circulation Federal Reserve notes, silver certificates,
and United States notes. Additional Federal Reserve notes will be issued to
replace the national bank notes as they are retired, and as demand arises. The
gold certificates to be delivered to the Federal Reserve banks will form added
reserves against which Federal Reserve notes may be issued.
At the time the gold content of the dollar was reduced, a gold increment
of $2,812,000,000 was realized. Of this amount, $2,000,000,000 was placed in the
stabilization fund. Congress has appropriated $139,000,000 for loans to industry through the Federal Reserve banks, some $13,500,000 of which has
been used for that purpose. Congress has appropriated an indefinite sum to
meet losses in melting gold coins estimated at $8,000,000, and has authorized
an appropriation of over $23^000,000, for the Ehilippine currency fund. This
leaves free gold of $642,0()0,006 which will now be used as a basis for debt
retirement.
As the outstanding national bank notes are retired and replaced with Federal Reserve notes, these items will disappear from the public debt statement
entirely. The total amount of outstanding currency should not be changed as
a result of this program. National bank notes will merely be replaced by
Federal Reserve notes. The effect on member bank reserves will be immaterial.
The texts of the formal notices of call were as follows:
To Holders of the 2 Percent Consols of 1930, and Others Concerned:
1. Public notice is hereby given that all outstanding United States 2 percent
consols of 1930, dated April 1, 1900, issued under authority of the act of
Congress approved'-March •14,' 1900^ are called .for. rede.mption ori Jiily. 1, 1935.
2. For. the purpose, of terminating .interest on J u l y i , 1935, this call shair be
effective as of April 1, 1935. Accordingly, interest on all outstanding 2 percent
consols of 1930 will cease 3 months thereafter, that is, on July 1, 1935.
3. Full information regarding the presentation and surrender of 2 percent
consols of 1930 for redemption on July 1, 1935, will be given in a Treasury
Department circular to be dated April 1, 1935.
HENRY MORGENTHAU, Jr,

Secretary of the Treasury.
TREASURY DEPARTMENT, Washington, March 11, 1935.

206

REPORT OP THE SECRETARY OP THE TREASURY

To Holders of the 2 Percent Bonds of the Panama CoAial Loan, Series of]
1916-36 and Series of 1918-38, and Others Concerned:
Public notice is hereby given that all outstanding United States 2 percent
bonds of the Panama Canal loan, series of 1916-36, dated August 1, 1906, and
series of 1918-38," dated November 1, 1908, issued under authority of the act
of Congress approved June 28, 1902, are called for redemption on August 1,
1935, and will cease to bear interest on that date.
Full information regarding the presentation and surrender of the 2 percent
bonds of the Panama Canal loan, series of 1916-36 and series of 1918-38, for
redemption on August 1, 1935, will be given in a Treasury Department circular
to be dated April 1, 1935.
HENRY MORGENTHAU, Jr.

Secretary of the Treasury.
;TREASURY DEPARTMENT, WashUigton, March 11, 1935.

The circulars governing the redemption of these bonds were as follows:
[Redemption of consols of 1930, Department Circular No. 533]
TREASURY DEPARTMENT,

Washington, April 1, 1935.
To Holders of 2 Percent Consols of 1930, and Others Concerned:
I . NOTICE OF CALL FOR REDEMPTION OF 2 PERCENT CONSOLS OF 1 9 3 0

On March 11, 1935,, the following public notice of call for redemption was
given:
(Notice of call is omitted here, see p. 205.)
I I . REDEMPTION OF 2 PERCENT CONSOLS OF 19 3 0

Pursuant to the call for redemption, as set forth in section I of this circular,
the following rules and regulations are hereby prescribed to govern the presentation and surrender of the 2 percent consols of 1930 for redemption on July
1, 1935:
1. Payments of called bonds on July 1, 19\35.—Holders of any outstanding
2 percent consols of 1930 will be entitled to have their bonds redeemed and
paid at par on July 1, 1935, with interest in full to that date. After July 1,
1935, interest will not accrue on any such bonds.
2. Presentation and surrender of registered bonds.—Two percent consols of
1930 in registered form must be assigned by the registered payees' or assigns
thereof, or by their duly constituted representatives, in accordance with the
general regulations of • the Treasury Department governing assignments, in
one of the forms hereinafter set forth, and thereafter should be presented and
surrendered to any Federal Reserve bank or branch, or to the Division of
Loans and Currency, Treasury Department, Washington, for redemption on
July 1, 1935. The bonds must be delivered at the expense and risk of owners,
,and should be accompanied by appropriate written advice. In order to facilitate redemption on July 1, 1935, such registered bonds should be presented and
surrendered well in advance of that date. Such early presentation will insure
prompt payment of principal and final interest when due. In all cases checks
in payment of principal and final interest willbe mailed to the address given
in the advice accompanying the bonds surrendered.
3. If the registered payee, or an assignee holding under proper assignment
from the registered payee, desires that payment of the principal and final
installment of interest be made to him, the bonds should be assigned by such
payee or assignee, or by a duly constituted representative, to " The Secretary
of the Treasury for redemption." If it is desired, for any reason, that payment be made to some other person, without intermediate assignment, the
bonds should be assigned to " The Secretary of the Treasury for redemption
for the account of
", inserting the name and address
of the person to whom payment is to be made. A representative or fiduciary
should not assign for payment to himself individually, unless expressly author
ized to do so by the instrument under which he is acting; he may, however,
assign for payment to himself in his representative or fiduciary capacity.

REPORT OP THE SECRETARY OP THE TREASURY

207

4. Assignments in blank, or assignments having similar, effect, should be
avoided, if possible, in order not to lose the protection afforded by registration.
However, such assignments will be recognized, but in that event payment will
be made to the person surrendering the bond for redemption, since under such
assignment the bond becomes in effect payable to bearer.
5. The transfer books for 2 percent consols of 1930 in registered form will
not close prior to July 1, 1935, for the payment of interest on that date, and
final interest due on«July 1, 1935, will be covered by payments to be made
simultaneously with payments made on account of principal.
6. Bonds held by the Treasurer of the United States in trust,—^Two percent
consols of 1930 in registered form on deposit with the Treasurer of the United
States on July 1, 1935, to secure circulating notes of national banks, or to
secure deposits of public money or postal savings funds, may be redeemed
upon assignment as follows:
{a) If deposited to secure circulating notes of national banks, the board of
directors of the national bank concerned should, by appropriate resolution,
authorize the Comptroller of the Currency to withdraw the bonds on deposit
and to redeUver such bonds to the Treasurer of the United States, and should
further authorize the Treasurer of the United States to assign such bonds to
" The Secretary of the Treasury for redemption for account of
", inserting in such form the name of the person or corporation to
whom payment is to^ be made. If the proceeds of redemption are to be paid to
the bank executing 'th^ resolution, its name should be inserted; if such proceeds are to be paid to someone other than such bank, the name of that person
or corporation should be inserted; and if such proceeds are to be applied toward
retirement of the circulating notes secured by such bonds,^ the following should
be inserted: " Treasury of the United States for account of
"
(name of bank executing the resolution). A certified copy of such resolution, together with the Treasurer's receipt for the bonds on deposit, should
be forwarded to the Comptroller of the Currency, Treasury Department,
Washington.
{b) If deposited to secure deposits of public money or postal savings funds,
the board of directors of the bank or trust company should, by appropriate
resolution, authorize the Treasurer of the United States to withdraw the
bonds and assign them to " The Secretary of the Treasury for redemption for
account of
", inserting in such form the name of the
person or corporation to whom payment is to be made. If other collateral
is substituted the name of the bank or trust company executing the resolution,
or the name of any other person or corporation, may be inserted. If such
proceeds are to be applied to the reduction of the deposits secured by the
bonds, the following should be inserted: " Treasurer of the United States for
account of
" (name of bank or trust company executing the resolution). A certified copy of such resolution, together with the
Treasurer's receipt for the bonds on deposit, should be forwarded to the
Treasurer of the United States, Division of Securities, Washington, accompanied by the collateral to be substituted for the bonds, in case a substitution
is to be made.
(c) The Comptroller of the Currency, or the Treasurer of the United States,
will forward appropriate resolution forms to each bank or trust company having
2 percent consols of 1930 on deposit as security for the above accounts.
7. Presentation and surrender of coupon bonds.—A small amount of 2 percent consols of 1930 in coupon form remain outstanding, without coupons attached covering interest accruing since April 1, 1930. Any such bonds should
be presented and surrendered for redemption on July 1, 1935, to any Federal
Reserve bank or branch, or to the Treasurer of the United States, Washington^
The bonds must be delivered at the expense and risk of the holder, and should
be accompanied by appropriate written advice. Checks in payment of principal
and accrued interest from April 1, 1930, to July 1, 1935, on such coupon bonds
will be mailed to the address given in the advice accompanying the bonds when
surrendered.
^The circulation privilege temporarily conferred by the act of July 22. 1932, on all
United States bonds' bearing interest at a rate not exceeding 3% percent per annum will
expire July 22, 1935; 2 percent bonds of the Panama Canal Loan of 1916-36 and 1918-38
have been called for redemption on Aug. 1, 1935.
16816—36

208

REPORT OP THE SECRETARY OF THE TREASURY
III. GENERAL PROVISIONS

1. Any further information which may be desired regarding the redemption
of the 2 percent consols of 1930 on July 1, 1935, under this circular may be
obtained from any Federal Reserve bank or branch, or from the Treasury
Department, Washington.
2. As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to perform any necessary acts under this cU'Cular. The Secretary
of the Treasury may at any time, or from time to time, prescribe supplemental
or amendatory rules and regulations governing tfie matters covered by this
circular, which m i l be communicated promptly to Federal Reserve banks.
HENRY MORGENTHAU, JR.,

Secretary of the Treasury.
[Eedemption of Panamas of 1916-36 and 1918-38.

Department Circular No. 534]

TREASURY

DEPARTMENT,

Washington, April 1, 1935.
To Holders of 2 Percent Bonds of the Panama Canal Loan, Series of 1916-36,.
and Series of 1918-38, and Others Concerned:
I. N O T I C E O F C A L L F O R R E D E M P T I O N B E F O R E MATURITY OF f HE 2 PERCENT BONDS OF

THE PANAMA CANAL LOAN, SERIES OF 1 9 1 6 - 3 6 AND SERIES OF 1 9 1 8 - 3 8

On March 11, 1935, the following public notice of call for redemption before
maturity was given:
(Notice of call is omitted here, see p. 206.)
II. REDEMPTION OF 2 PERCENT BONDS OF THE PANAMA CANAL LOAN

Pursuant to the call for redemption, as set forth in section I of this circular,
the following rules and regulations are hereby prescribed to govern the presentation and surrender of the 2 percent bonds of the Panama Canal Loan,,
series of 1916-36, and series of 1918-38, for redemption on August 1, 1935:
1. Payment of called bonds on August 1, 1935.—Plolders of any outstanding
2 percent .bonds of the Panama Canal Loan will be entitled to have their bonds
redeemed and paid at par on August 1, 1935, with interest in full to that date.
After August 1, 1935, interest will not accrue on any such bonds,
2. Presentation and surrender of registered Ibonds.—Two percent bonds of the
Panama Canal Loan in registered form must be assigned by the registered
payees or assigns thereof, or by their duly constituted representatives, in accordance with the general regulations of the Treasury Department governing
assignments, in one of the forms hereinafter set forth, and thereafter should
be presented and surrendered to airiy Federal Reserve bank or branch, or to
the Division of Loans and Currency, Treasury Department, Washington, for
redemption on August 1, 1935. The bonds'must be delivered at the expense and
risk of owners and should be accompanied by appropriate written advice. In
order to facilitate redemption on August 1, 1935, such registered bonds should
be presented and surrendered well in advance of that date. Such early presentation will insure prompt payment of principal and final interest when due.
In all cases checks in payment of principal and final 'interest will be mailed
to the address given in the advice accompanying the bonds surrendered.
3. If the registered payee, or an assignee holding under proper assignment
froin the registered payee, desires that payment of the principal and final installment of interest be made to him, the bonds should be .assigned by such
payee or assignee, or by a duly constituted representative, to " The. Secretary of
the Treasury for redemption." If it is desired, for any reason, that payment
be made to some other person, without intermediate assignment, the bonds
should be assigned to " The Secretary of the Treasury for redemption for the
account of
", inserting the name and address of the person
to whom payment is to be made. A representative or fiduciary should not
a,ssign for payment to himself individually, unless expressly authorized to do
so by the instrument under which he is acting; he may, however, assign for
paymerit to himself in his representative or fiduciary capacity.
4. Assignments in blank, or assignments having similar effect, should be
avoided, if possible, in order not to lose the protection afforded by registration.

EEPOET OF THE SECEETAEY OF THE TEEASUEY

209

However, such assignments will be recognized, but in that event payment will
be made to the person surrendering the bond for redemption, since under such
assignment the bond becomes in effect payable to bearer.
5. The transfer booksi for 2 percent Panama Canal bonds in registered form
will not close prior to August 1, 1935, for the payment of interest on that date,
and final interest due on August 1, 1935, will be covered by payments to be
made simultaneously with payments made on account of principal.
6. Bonds held by the Treasurer^ of the United States in trust.—Two percent
Panama Canal bonds in registered form on deposit with the Treasurer of the
United States on August 1, 1935", to secure circulating notes of national banks,
'or to secure deposits of public money or postal savings funds, may be redeemed
upon assignment as follows:
(a) If deposited to secure circulating notes of national banks, the board of
directors of the national bank concerned should, by appropriate resolution,
authorize the Comptroller of, the Curency to withdraw the bonds on deposit and
to redeliver such bonds to' the Treasurer of the United States, and should
further authorize the Treasurer of the United States to assign such bonds
to " The Secretary of the Treasury for redemption for account of
", inserting in such form the name of the person or corporation to
whom payment is to be made. If the proceeds of redemption are to be paid
to the bank executing the resolution, its name should be inserted; if such
proceeds are to be paid to some one other than such bank, the name of that
person or corporation should be inserted; and if such proceeds are to be
applied toward retirement of the circulating notes secured by such bonds,^ the
following should be inserted: " Treasurer of the United States for account of
" (name of bank executing the resolution). A certified copy of such resolution, together with the Treasurer's receipt for the bonds
on deposit, should be forwarded to the Comptroller of the Currency, Treasury
Department, Washington.
(&) If deposited to secure deposits of public money or postal savings funds,
the board of directors of the bank or trust company should, by appropriate
resolution, authorize the Treasurer of the United States to withdraw the bonds
and assign them to " The Secretary of the Treasury for redemption for account
of
", inserting in such form the name of the person
or corporation to whom payment is to be made. If other collateral is substituted the name of the bank or trust company executing the resolution, or the
name of any other person or corporation, may be inserted. If such proceeds are
to be applied to the reduction of the deposits secured by the bonds, the following
.should be inserted: " Treasurer of the United States for account of
", (name of bank or trust company executing the resolution).
A certified copy of such resolution, together with the Treasurer's receipt for
the bonds on deposit, should be forwarded to the Treasurer of the United States,
Division of Securities, Washington, accompanied by the collateral to be substituted for the bonds, in case a substitution is to be made.
(c) The Comptroller of the Currency, or the Treasurer of the United States,
will forward appropriate resolution forms to each bank or trust company
having 2 percent Panama Canal bonds on deposit as security fbr the above
accounts.
7. Presentation and surrender of cou^pon bonds.—A small amount of 2 percent
Panama Canal bonds in coupon form are outstanding. Any such bonds should
be presented and surrendered for redemption on August 1, 1935, to any Federal
Reserve bank or branch, or to the Treasurer of the United States, Washington.
Coupons dated August 1, 1935, should be detached from such bonds when presented, and collected in regular course, and coupons bearing subsequent dates
should be attached to the bonds when presented. The bonds must be delivered
at the expense and risk of the holder and should be accompanied by appropriate written advice. Checks in payment of principal will be mailed to the
address given in the advice accompanying the bonds surrendered.
III. GENERAL PROVISIONS

1. Any further information which may be desired regarding the redemption,
of the 2 percent Panama Canal bonds of August 1, 1935, under this circular
2 The circulation privilege temporarily conferred, by the act of July 22, 1932, on a l l
United States bonds bearing interest at a rate not exceeding 3 % percent per annum
will expire July 22, 1935 ; 2 percent consols of 1930 have been_.^called for redemption on
July 1, 1935,

210

REPORT OP THE SECRETARY OF THE TREASUEY

may be obtained from any F e d e r a l Reserve bank or branch, or from t h e T r e a s u r y Department, Washington,
2. As fiscal agents of t h e United States, Federal Reserve banks a r e authorized
a n d requested to perform any necessary acts under this circular. The Secret a r y of t h e Treasury may a t any time, or from time to time, prescribe supplemental or amendatory rules and regulations governing the m a t t e r s covered
by this circular, which will be communicated promptly to F e d e r a l Reserve
banks.
H E N R Y MORGENTHAU,

Jr.,

Secretary of the Treasury.

Exhibit 11
Call for redemption of F i r s t Liberty Loan bonds of 1932-47 on J u n e 15, 1935
On March 14, 1935, Secretary of t h e T r e a s u r y Morgenthau announced t h a t
all outstanding F i r s t Liberty Loan bonds, including those of the original issue
a n d those subsequently issued on conversion, would be called for redemption
on J u n e 15, 1935.
T h e F i r s t Liberty Loan, in the form of ^Yi percent bonds, w a s originally
issued J u n e 15, 1917, in the total amount of $1,989,455,550. Subsequently three
conversion privileges arose and the 3 % percent bonds were in p a r t converted
into other F i r s t Liberty Loan bonds bearing interest a t 4 or 4 ^ percent, and
t h e 4 percent bonds issued on conversion were largely converted into 4 ^ percent bonds. F i r s t Liberty Loan bonds outstanding on F e b r u a r y 28, 1935, were
divided among the four issues a s follows:
F i r s t 3y2's
F i r s t converted 4's
F i r s t converted 4 ^ ' s
First-second converted 4 ^ ' s
Total

- $1, 392, 226, 250
5, 002, 450
532, 489,100
3, 492,150
1, 933, 209, 950

T h e text of t h e formal notice of call follows:
To Holders of F i r s t Liberty Loan Bonds of 1932-47, a n d Others Concerned:
Public notice is hereby given:
1. All outstanding F i r s t Liberty Loan bonds of 1932-47 a r e hereby called
for redemption on J u n e 15, 1935. T h e various issues of F i r s t Liberty Loan
bonds (all of which a r e included in t h i s call) a r e as follows:
F i r s t Liberty Loan 3 ^ percent bonds of 1932-47 ( F i r s t 3y2's), dated J u n e 15,
1917;
F i r s t Liberty Loan converted 4 percent bonds of 1932-47 ( F i r s t 4 ' s ) , dated
November 15, 1917;
F i r s t Liberty Loan converted ,414 percent bonds of 1932^-47 ( F i r s t 4 % ' s ) ,
dated May 9, 1918; and
F i r s t Liberty Loan second converted 4^4 percent bonds of 1932-47 (Firstsecond 4 ^ ' s ) , dated October 24, 1918.
2. I n t e r e s t on all such outstanding F i r s t Liberty Loan bonds will cease on
said redemption date, J u n e 15, 1935.
3. Full information regarding t h e presentation and surrender of F i r s t Liberty
Loan bonds for redemption under t h i s call will be given in a T r e a s u r y Departm e n t circular to be issued later.
4. Holders of F i r s t Liberty Loan bonds now called for redemption on J u n e 15,
1935, may, in advance of t h a t date, be offered the privilege of exchanging all
o r any p a r t of their caUed bonds for other interest-bearing obligations of the
United States, in which event public notice will hereafter be given.
H E N R Y MORGENTHAU,

Jr.,

Secretary of the Treasury.
TREASURY DEPARTMENT,

Washington, March 14y 1935.
T h e circular governing the redemption of t h e F i r s t Liberty Loan bonds is as
follows:

REPORT OP T H E SECRETARY OF THP-TREASURY

211

[Department Circular No. 535]
TREASURY DEPARTMENT,

Washington, April 22, 1935.
To Holders of First Liberty Loan Bonds of 1932-47, and Others Concerned:
I . NOTICE OF CALL FOR REDEMPTION BEFORE M A T U R I T Y

On March 14, 1935, the following public notice of call for redemption was
given:
[Notice of call is omitted here, see p. 210.]
n . OPTIONAL E X C H A N G E OFFERING

1. Holders of First Liberty Loan bonds, called for redemption on June 15,
1935, are offered the privilege, for a limited period beginning April 22, 1935,
of exchanging all or any part of their called bonds, either (1) for 2ys percent
Treasury bonds of 1955-60, or (2) for 5-year 1% percent Treasury notes of
series A-1940, both bonds and notes being dated and bearing interest from
March 15, 1935.
2. Full information concerning the optional exchange offering of Treasury
bonds is set forth in Treasury Department Circular No. 536, and full information concerning the optional exchange offering of Treasury notes is set forth in
Treasury Department Circular No. 537, both circulars being dated April 22,
1935. As the privilege of exchanging First Liberty Loan bonds will be accorded for a limited period only and may be terminated at any time without
notice, holders of First Liberty Loan bonds who desire to take advantage of
either offering should act proniptly, following the instructions given in the
Treasury Department circulars referred to above, copies of which may be
obtained from any Federal Reserve bank or branch,^ or from the Treasury
Department, Washington, D. C.
I I I . RULES AND REGULATIONS GOVERNING REDEMPTION OF F I R S T LIBERTY LOAN BONDS

Pursuant to the call for redemption, as set forth in section I of this circular,
the following rules and regulations are hereby prescribed to govern the presentation and surrender of First Liberty Loan bonds for redemption on June 15,
1935:
1. Payment of called bonds on June 15, 1935.—Holders of any outstanding
First Liberty Loan bonds will be entitled to have such bonds redeemed and
paid at par on June 15, 1935, with interest in full to that date. After June 15,
1935, interest will not accrue on any First Liberty Loan bonds.
2. Presentation and surrender of coupon bonds.—First Liberty Loan bonds
in coupon form should be presented and surrendered to any Federal Reserve
bank or branch, or to the Treasurer of the United States, Washington, D, C,
for redemption on June 15, 1935. The bonds must be delivered at the expense
and risk of holders (see par. 8 of this section) and should be accompanied
by appropriate written advice (see form P. D. 1435 attached hereto). Checks
in payment of principal will be mailed to the address given in the form
of advice accompanying the bonds surrendered.
3. Coupons dated June 15, 1935, which become payable on that date, should
be detached from any First Liberty Loan bonds before such bonds are presented for redemption on June 15, 1935, and such coupons should be collecte.d
in regular course when due. All coupons pertaining to such bonds bearing dates'
subsequent to June 15, 1935, must be attached to any such bonds when presented for redemption, provided, however, if any such coupons are missing froiri
bonds so presented for redemption the bonds nevertheless will be redeemed,
but the full face amount of any such missing coupons will be deducted from
the payment to be made on account of such redemption, and any amounts so
deducted will be held in the Treasury to provide for adjustments or refunds
on account of such missing coupons as may subsequently be presented.^
^ First 4's, First 4i4's, and First-second 4ii„'s were originally issued in temporary form:
The final coupon attached to such temporary bonds became due on Dec. 15, 1919, Jun^
15, 1920, and Dec. 15, 1920, respectively. The holders of any such temporary bonds
will receive all past due interest to June 15, 1935, when such bonds are redeemed pursuant to the call. Any coupons now attached. to siich "temporary bonds should be
detached and collected in regular course.

212

REPORT OF THE SECRETARY OP THE TREASURY

4. Presentation and surrender of registered bonds.—First Liberty Loan bonds
in registered form must be assigned by the registered payees or assigns thereof,
or by their duly constituted representatives, in accordance with the general
regulations of the Treasury Department governing assignments, in the form
indicated in the next paragraph hereof, and thereafter should be presented
and surrendered to any Federal Reserve bank or branch, or to the Division
of Loans and Currency, Treasury Department, Washington, D. C, for redemption on June 15, 1935. The bonds must be delivered at the expense and risk
of holders (see par. 8 of this section) and should be accomjpanied by appropriate written advice (see form P. D. 1436 attached hereto). In all cases
checks in payment of principal and final interest due will be mailed to the
address glA^en in the form of advice accompanying the bonds surrendered.
5. If the registered payee, or an assignee holding under proper assignment
from the registered payee, desires that payment of the principal and final
installment of interest be made to him, the bonds should be assigned by such
payee or assignee, qr by a duly constituted representative, to " The Secretary
of the Treasury for redemption." If it is desired, for any reason, that payment
be made to some other person, without intermediate assignment, the bonds
should be assigned to " The Secretary of the Treasury for redemption for the
account of
", inserting the name and address of the person to whom
payment is to be made. A representative or fiduciary should not assign for
paj^'ment to himself individually, unless expressly authorized to do so by the
instrument under which he is acting; he may, however, assign for payment to
himself in his representative or fiduciary capacity.
6. Assignment in blank or other assignment having similar effect, will be
recognized, but in that event payment will be made to the person surrendering
the bond for redemption, since under such assignment the bond becomes in
effect payable to bearer. Assignments in blank or assignments having similar
effect should be avoided, if possible, in order not to lose the protection afforded
by registration.
7. Final interest due on June 15, 1935, on registered bonds of the First Liberty Loan will be paid with the principal in accordance with the assignments
on the bonds surrendered. Transfers and exchanges involving registered bonds
will be permitted up to the close of business on May 31, 1935, but not after
that date.
8. TroMsportation of bonds.—Bonds presented for redemption under this circular must be delivered to a Federal Reserve bank or branch, or to the Treasury Department, Washington, D. C, at the expense and risk of the holder.
Coupon bonds should be forwarded by registered mail insured, or by express
prepaid. Registered bonds bearing restricted assignments may be forwarded by
registered mail, but registered bonds bearing unrestricted assignments should
be forwarded by registered mail insured or by express. Facilities for transportation of bonds by registered mail insured may be arranged between incorporated banks and trust companies and the Federal Reserve banks, and holders
may take advantage of such arrangements when available, utilizing such incorporated banks and trust companies as their agents. Incorporated banks and
trust companies are not agents of the United States under this circular.
IV. T I M E OF P R E S E N T A T I O N OF CALLED BONDS FOR REDEMPTION

1. In order to facilitate the redemption of First Liberty Loan bonds on June
15, 19^35, any.such bonds should be presented and surrendered in the manner
herein prescribed well in advance of that date, but not before May 15, 1935.
Such early presentation by holders will assure prompt payinent of principal
when due. This is particularly important with respect to registered bonds, for
payment cannot be made until registration shall have been discharged at the
Treasury Department.
2. It will expedite redemption if the bonds are presented to Federal Reservf*
banks, or branches, and not direct to the Treasury Department.
3. As hereinbefore provided: (1) coupons due June 15, 1935, should be-detached from any permanent coupon bonds when such bonds are presented for
redemption on that date, such coupons to be collected when due; and (2) final
interest due on any registered bonds will be paid with the principal amount.
4. If First Liberty Loan bonds called for redemption on June 15, 1935, are
to be presented for exchange for 2% percent Treasury bonds of 1955-60, instructions given in Treasury Department Circular No. 536 should be followed;
if to be presented for 1% percent Treasury notes of series A-1940, instructions

213

REPORT OF THE SECRETARY OP T H E TREASURY

given in Treasury Department Circular No. 537 should be followed; if to be
presented for redemption on June 15, instructions given in this circular should
be followed.
V. GENERAL PROVISIONS

1. Any further information which may be desired regarding the redemption
of First Liberty Loan bonds under this circular may be obtained from any
Federal Reserve bank or branch, or from the Treasury Department, Washington, D. C, where copies of the Treasury Department's regulations governing
assignments also may be obtained.
2. As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to perform any necessary acts under this circular. The Secretary
of the Treasury may at any time, or from time to time, prescribe supplemental
or amendatory rules and regulations governing the matters covered by this
circular, which will be communicated promptly to Federal Reserve banks.
HENRY MORGENTHAU, JR.,

Secretary of the Treasury.
FOR COUPON BONDS
[Form P D 1435.

For registered bonds use form P D 1436]

Use separate form for each issue
FORM OF ADVICE TO ACCOMPANY FIRST LIBERTY T^OAN BONDS IN COUPON FORM
PRESENTED FOR REDEMPTION ON JUNE 15, 1935
To

THE

FEDERAL RESERVE B A N K

or
TREASURER OF THE UNITED STATES,

Washington, D . C .
Pursuant to the provisions of Treasury Department Circular No. 535, dated
April 22, 1935, the undersigned presents and surrenders herewith for redemption
on June 15, 1935, $
, face amount of First Liberty Loan bonds in
coupon form, with coupon due December 15, 1935, and all subsequent coupons
attached, as follows:
Title of issue:
(Use short title—see note)
Number of bonds

Denomination

Serial numbers of bonds

Face
amount

$50
100
500
1,000
5,000
10,000
100,000
Total

and requests that remittance covering payment therefor be forwarded to the
undersigned at the address indicated below.
Signature
Name (please print)
Address in full
.
Date _-.

NOTE.—The titles of the four issues of Furst Liberty Loan bonds follow:
Title
Short title
First Liberty Loan 3H% bonds of 1932-47
First 3H?s
First Liberty Loan converted 4% bonds of 1932-47
First 4's
First Liberty Loan converted i}4% bonds of 1932-47
First 4j^'s
First Liberty Loan second-converted 4 ^ % bonds of 1932-47
First-second 4K'£

214

REPORT OF THE SECRETARY OP THE TREASURY
FOR REGISTERED BONDS
[Form P D 1436.' F o r coupon bonds use form P D 1435]

Use separate form for each issue
FORM OF ADVICE TO ACCOMPANY FIRST LIBERTY LOAN BONDS IN REGISTERED FORM
PRESENTED FOR REDEMPTION ON JUNE 15, 1935
To the FEDERAL RESERVE BANK OF

or
TREASURY DEPARTMENT, DIVISION OF LOANS AND CURRENCY,

Washington, D. C :
Pursuant to the provisions of Treasury Department Circular No. 535, dated
April 22, 1935, the undersigned presents and surrenders herewith for redemption on June 15, 1935, $
, face amount of First Liberty Loan bonds
in registered form, inscribed in the name of
and duly
assigned to " The Secretary of the Treasury for redemption ", as follows:
Title of issue:
(Use short title—see note)
Number of bonds

Denomination

Face
amount

Serial numbers of bonds

$50
100
600
1,000
6,000
10,000
50,000
100.000
Total

Liberty
Liberty
Liberty
Liberty

Title
Loan ZH% bonds of 1932-47
Loan converted 4% bonds of 1932-47
Loan converted 4J^% bonds of 1932-47
Loan second-converted 4 ^ % bonds of 1932-47

Short title
First 3H's
First 4's
First 4K's
First-second i^i's

Exhibit 12
Call for redemption on October 15, 1935, of Fourth Liberty Loan bonds before
maturity {final call)
On April 14, 1935, Secretary of the Treasury Morgenthau &.nnounced the call
of the balance of the Fourth Liberty Loan 4^4 percent bonds of 1933-38 for
redemption on October 15, 1935. The Fourth Liberty Loan bonds included in
this fourth and final call amounted to about $1,250,000,000.
Bonds of the Fourth Liberty Loan were originally issued under date of
October 24, 1918, in the amount of about $6,965,000,000. Subsequent to their
issue, and prior to the first call for partial redemption, which was made on
October 12, 1933, nearly $700,000,000 of these bonds were retired. The first
three calls for partial redemption paved the way for the retirement of about
$5,000,000,000 more, leaving about $1,250,000,000 outstanding. Of the $5,000,-

REPORT OP THE SECRETARY OP THE TREASURY
000,000 of
exchanged
have been
deemed on
The text

215

bonds included in the first three caUs, about $4,315,000,000 were
for other interest-bearing obligations, and about $320,000,000 more
paid in cash. Most of the remaining $365,000,000 were to be reApril 15 or shortly thereafter.
of the formal notice of call was as follows:

To Holders of Fourth Liberty Loan 4V4. Percent Bonds of 1933-38, and Others
Concerned:
Public notice is hereby given:
1. All outstanding Fourth Liberty Loan 4^/4 percent bonds of 1933-38
(Fourth 414's) bearing serial numbers the final digit of which is 3 or 4 (such
serial numbers in the case of permanent coupon bonds being prefixed by the
corresponding distinguishing letter C or D, respectively), are hereby called for
redemption on October 15, 1935, on which date interest on such bonds called
for redemption will cease.
2. Full .information regarding the presentation and surrender of Fourth
414's for redemption under this call will be given in a Treasury Department
circular to be issued later.
3. Holders of Fourth 4i/4's now called for redemption on October 15, 1935,
may, in advance of that date, be offered the privilege of exchanging all or any
part of their called bonds for other interest-bearing obligations of the United
States, in which event public notice will hereafter be given.
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
TREASURY DEPARTMENT,

Washington, April 13, 1935.
The Department circular governing the redemption of the bonds was as
follows:
[Department

Circular No. 539.]
TREASURY

DEPARTMENT,

Washington, May 13, 1935.
To Holders of Fourth Liberty Loan li^k Percent Bonds of 1933-38, OMd Others
Concerned:
T. NOTICE OF F O U R T H AND F I N A L CALL FOR REDEMPTION BEFORE M A T U R I T Y OF F O U R T H
LIBERTY LOAN H P E R C E N T BONDS OF 1 9 3 3 - 3 8 ( F O U R T H 4 i ' S )

On April 13, 1935, the following public notice of call for redemption was
given:
[Noitice of call omitted here, see above.]
I I . T R A N S A C T I O N S I N FOURTH-CALLED BONDS

1. The bonds included in the fourth and final call for redemption on October
15, 1935, are hereby designated fourth-called Fourth 414's.^
2. Denominational exchanges of coupon bonds within the class fourth-called
Fourth 414's will terminate at the close of business on October 14, 1935. Transfers and exchanges involving registered bonds within the same class will be
permitted up to the close of business on September 30, 1935, but not after that
date.
1 Fourth 414's (temporary coupon, permanent coupon, and registered) are numbered
serially beginning with no. 1 for each denomination ; in the case of permanent coupon
bonds each serial number is prefixed by a distinguishing letter, the letters A to K (omitting I) being used, which letters, in order, rotate with and correspond to the final digits
from 1 to 0, respectively.
First-called Fourth 4i4*s (called for redemption on Apr. 15, 1934—Department Circular
No. 501, dated Oct. 12, 1933) bear serial numbers ending in 9, 0, or 1 (in the case of
permanent coupon bonds preceded by the distinguishing letter J, K, or A, respectively) r.
second-called Fourth 414's (called for redemption on Oct. 15, 1934—Department Circular
No, 509, dated Apr. 13, 1934) bear serial numbers ending in 8 or 2 (in the case of
permanent coupon bonds preceded by the distinguishing letter H or B, respectively) ;
third-called Fourth 414's (called for redemption on Apr. 15, 1935—Department Circular
No. 525. dated Oct. 12, 1934) bear serial numbers ending in 5, 6, or 7 (in the case of
permanent coupon bonds preceded by the distinguishing letter E. F, or G, respectively) ;
and fourth-called Fourth 414's (called for redemption on Oct. 15, 1935) bear serial
numbers ending in 3 or 4 (in the case of permanent coupon bonds preceded by the distinguishing letter C or D, respectively).

216

REPORT OF THE SECRETARY OF THE TREASURY
I I I . P A Y M E N T OR E X C H A N G E

1. Payment of fourth-called bonds on October 15, 1935.—Plolders of fourthcalled Fourth 4^1,'s will be entitled to have such bonds redeemed and paid at
par on October 15, 1935, with interest in full to that date. After October 15,
1935, interest will not accrue on any such bonds included in the fourth and final
call for redemption.
2. Optional exchange offering.—Holders of fourthrcalled Fourth 4i/4's may, in
advance of October 15, 1935, be offered the privilege of exchanging all or any
part of their fourth-called bonds for other interest-bearing obligations of the
United States, in which event due public notice will be given. Holders who desire to avail themselves of any exchange privilege, if and when offered, should
watch for an announcement thereof, and should request their bank or trust company to notify them when information regarding any exchange offering is
received.
3. In case of an exchange offering, instructions then given in the public
announcement and the official circular should be followed in presenting fourthcalled bonds for exchange; otherwise the instructions hereinafter set forth in
this circular should be followed for the presentation of such fourth-called bonds
tor redemption on October 15, 1935.
IV. REDEMPTION OF FOURTH-CALLED F O U R T H

4^'S

1. Presentation and surrender of coupon bonds.—Fourth-called Fourth 4i/4's
iu coupon form should be presented and surrendered to any Federal Reserve
bank or branch, or to the Treasurer of the United States, Washington, D. C,
for redemption on October 15, 1935. The bonds must be delivered at the expense
and risk of holders (see par, 7 of this section) and should be a.ccompanied by
appropriate written advice (see form P, D. 1445 attached hereto). Checks in
payment of principal will be mailed to the address given in the form of advice
accompanying the bonds surrendered.
2. Coupons dated October 15, 1935, which be(!ome payable on that date, should
be detached from any fourth-called Fourth 414's before such bonds are presented for redemption on October 15, 1935, and such coupons should be collected
in regular course when due. All coupons pertaining to such bonds bearing dates
subsequent to October 15, 1935, must be attached to such bonds when presented
for redemption, provided, however, if any such coupons are missing from bonds
so presented for redemption the bonds nevertheless will be redeemed, but the
fuU face amount of any such missing coupons will be deducted from the payment to be made on account of such redemption, and any amounts so deducted
will be held in the Treasury to provide for adjustments or refunds on account
of such missing coupons as may subsequently be presented.^
3. Presentation and surrender of registered bonds.—Fourth-called Fourth
414's in registered form must be assigned by the registered payees or assigns
thereof, pr by their duly constituted representatives, in accordance with the
general regulations of the Treasury Department governing assignments, in the
form indicated in the next paragraph hereof, and should thereafter be presented
and surrendered to any Federal Reserve bank or branch, or to the Division of
Loans and Currency, Treasury Department, Washington, D. C, for redemption
on October 15, 1935. The bonds must be delivered at the expense and risk of
holders (see par. 7 of this section) arid should be accompanied by appropriate
written advice (see form P. D. 1446 attached hereto). In all cases checks in
payment of principal and final interest will be mailed to the address given in
the form of advice accompanying the bonds surrendered.
4. If the registered payee, or an assignee holding under proper assignment
from the registered payee, desires that payment of the principal and final installment of interest be made to him, the bonds should be assigned by such payee or
assignee, or by a duly constituted representative, to "the Secretary of the
Treasury for redemption." If it is desired, for any reason, that payment be
made to some other person, without intermediate assignment, the bonds should
be assigned to " the Secretary of the Treasury for redemption for the account of
:
", inserting the name and address of the person to
2 The final coupon atta ched: to temporary coupon bonds ibecame due on October 15, 1920.
The holders of any such, temporary bonds which are included in the fourth call for
•redemption on October 15, 1935, will receive all past due interest from October 15. 1920.
when the bonds are redeemed pursuant to such call. All coupons now attached to any
such temporary bonds should be detached and collected in regular course.

REPOET OF THE SECRETAEY OF THE TEEASURY

217

whom payment is to be made. A representative or fiduciary should not assign
for payment to himself individually, unless expressly authorized to do so by
court order or by the instrument under which he is acting; he may, however,
assign for payment to himself in his representative or fiduciary capacity.
5. Assignment in blank, or other assignment having similar effect, will be
recognized, but in that event payment will be made to the person surrendering
the bond for redemption, since under such assignment the bond becomes in effect
payable to bearer. Assignments in blank or assignments having similar eft'ect
should be avoided, if possible, in order not to lose the protection afforded by
registration.
6. Final interest due on October 15, 1935, on any fourth-called Fourth 4%'s
in registered form, will be paid with the principal in accordance with the assignments on the bonds surrendered.
7. TroAisportation of bonds.—Bonds presented for redemption under this circular must be delivered to a Federal Reserve bank or branch, or to the Treasury
Department, Washington, D. C, at the expense and risk of the holder. Coupon
bonds should be forwarded by registered mail insuredj or by express prepaid.
Registered bonds bearing restricted assignments may be forwarded by registered
mail, but registered bonds-bearing unrestricted assignments should be forwarded
by registered mail insured or by express. Facilities for transportation of borids
by registered mail insured may be arranged between incorporated banks and
trust companies and the Federal Reserve banks, and holders may take advantage
of such arrangements when available, utilizing such incorporated banks and
trust companies as their agents. Incorporated banks and trust companies are
not agents of the United States under this circular.
V. T I M E

OF P R E S E N T A T I O N

OF FOURTH-CALLED

FOURTH

4i'S

FOR

REDEMPTION

1. In order to facilitate the redemption of fourth-called Fourth 414's on
October 15, 1935, any such bonds should be presented and surrendered in the
manner herein prescribed in advance of that date but not before September 15,
1935. Such early presentation by holders will assure prompt payment of principal when due. This is particularly important with respect to registered bonds,
for payment cannot be made until registration sh^ll have been discharged at
the Treasury Department.
2. It will expedite redemption if the bonds included in the fourth call for
redemption are presented to Federal Reserve banks or branches, and not direct
to the Treasury Department.
VI. GENERAL PROVISIONS

1. Any further information which may be desired regarding the redemption
of fourth-called Fourth 4y,'s under this circular may be obtained from any
Federal Reserve bank or branch, or from the Treasury Department, Washington, D. C, where copies of the Treasury Department's regulations governing
assignments may also be obtained.
2. As fiscal agents of the United States, Federal Reserve banks are authorized and requested to perform any necessary acts under this circular. The
Secretary of the Treasury may at any time, or from time to time, prescribe
supplemental or amendatory rules and regulations governing the matters covered by this circular, which will be communicated promptly to Federal Reserve
banks.
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
Exhibit 13
Offering of £% percent Treasury bonds of 1955-60 (additional) and 1% per^cent Treasury notes of series A-1940 (additional)
On April 22, 1935, Secretary of the Treasury Morgenthau announced the
offering of additional issues of 2% percent Treasury bonds of 1955-60 and of
1% percent Treasury notes of series A-1940, both in exchange for First Liberty
Loan bonds, of any series, called for redemption on June 15, 1935.

218

REPORT OF THE SECRETARY OF THE TREASURY
[Treasury bonds of 1955-60.

Department Circular No. 536] .
TREASURY DEPARTMENT,

Washington, April 22, 1935.
I. EXCHANGE OFFERING OF BONDS

1. The Secretary of the Treasury, pursuant to the authority of the Second
LibertV Bond Act, approved September 24, 1917, as amended, for refunding
purposes, invites subscriptions from the people of the United States for 2%
percent bonds of the United States, designated Treasury bonds of 1955-60, in
payment of which only First Liberty Loan bonds, of any series, called for
redemption on June 15, 1935, may be tendered. The amount of the additional
issue of 2% percent Treasury bonds of 1955-60 under this circular will be
limited to the amount of First Liberty Loan bonds tendered and accepted.
2. First Liberty Loan bonds will be received on exchange at par, and 2%
percent Treasury bonds of 1955-6() will be issued at par, with the right
reserved by the Secretary of the Treasury to increase the issue price by publio
announcement effective as to subscriptions tendered after the time, not earlier
than April 29, 1935, fixed in the announcement. On all exchanges, interest adjustments will be made as of June 15, 1935.
, 3. The outstanding bonds of the First Liberty Loan called for redemption
on June 15, 1935, and which, under the terms of this circular, may be exchanged for 2% percent Treasury bonds of 1955-60, follows:
3% per.cent bonds of 1932-47 (First 3y2's) dated June 15, 1917
Converted 4 percent bonds of 1932-47 (First 4's) dated November 15, 1917
Converted 4% percent bonds of 1932-47 (First 4yt's) dated May 9, 1918
Second converted 4i/4 percent bonds of 1932-47 (First-second 414's) dated
October 24, 1918
4. In addition to the exchange offering under this circular, holders of First
Liberty Loan bonds are offered the privilege of exchanging all or any part
of such called bonds for 5-year 1% percent Treasury notes of series A-1940,
which offering is set forth in Department Circular No. 537, issued simultane-.
ously with this circular.
II. DESCRIPTION OF BONDS

1. The bonds now offered will be an addition to and will form a part of the
series of 2ys percent Treasury bonds of 1955-60 issued pursuant to Department Circular No. 531, dated March 4, 1935, are identical in all respects therewith, will be freely interchangeable, and are described in the following quotation from said Circular No. 531:
(Description omitted here, see p. 201.)
III. SUBSCRIPTION A N D ALLOTMENT

1. Subscriptions will be received at the Federal Reserve banks and branches
and at the Treasury Department, Washington. Banking institutions generally
will handle applications for subscribers, but only the Federal Reserve banks and
the Treasury Department are authorized to act as official agencies. The Secretary of the Treasury reserves the right to close the books as to any or all
subscriptions or classes of subscriptions at any time without notice.
2. The Secretary of the Treasury reserves the right to reject any subscription, in whole or in part, to allot less than the amount of bonds applied for, to
make allotments in full upon subscriptions for smaller amounts and tO' make
reduced allotments upon, or to reject, subscriptions for larger amounts, to make
classified allotments or to make allotments upon a graduated scale, or to adopt
any or all of said methods or such other methods of allotment and classification
of allotments as shall be deemed by him to be in the public interest; and his
action in any or all of these respects shall be final. Subject to these reservations, all subscriptions will be allotted in full. Allotment notices will be sent
out promptly upon allotment.
rv.'TERMS OF PAYMENT AND ISSUE

1. Treasury bonds offered under this circular will be issued at par, or at such
increased issue price as may be fixed by public announcement in the case of
bonds issued upon subscriptions tendered to a Federal Reserve bank or branch

REPORT OP THE SECRETARY OF THE TREASURY

219

or to the Treasury Department after the time stated in the announcement. The
effective time for any increase which may be made in the issue price will be
after the date of the announcement and in no event earlier than April 29, 1935.
Any such announcement fixing an increase in the issue price and the time when
such increase becomes effective will be communicated promptly to the Federal
Reserve banks. Payment for any bonds allotted under this circular may be
made only in First Liberty Loan bonds of any series, which will be accepted
at par, provided that payment of the premium by reason of any increase in the
issue price shall be made as provided in the next following paragraph. The
bonds tendered in payment should accompany the subscription.
2. Interest adjustment as of June 15, 1935.—Subscribers will be credited with
interest in full to June 15, 1935, on First Liberty Loan bonds tendered in
exchange, and will be charged with accrued interest from March 15 to June
15, 1935 ($7.1875 per $1,000), on 2% percent Treasury bonds of 1955-60 issued
on exchange. The net interest adjustment per $1,000 principal amount on
account of the various issues of First Liberty Loan bonds follows: First 3i/^'s—
$10.3125; First 4's—$12.8125 ; First 4Ws and First-second 4^'s—$14,0625. This
net interest adjustment (less any premium by reason of an increase in the
issue price) will be paid to subscribers following acceptance of First Liberty
Loan bonds under this circular.
V. SURRENDER OF F I R S T LIBERTY LOAN BONDS ON

EXCHANGE

1. Coupon bonds.—First Liberty Loan bonds in coupon form tendered im
exchange for Treasury bonds offered hereunder, should be presented and surrendered with the subscription to a Federal Reserve bank or to the Treasurer
of the United States. Coupons dated June 15, 1935, and all coupons bearing
dates subsequent to June 15, 1935, should be attached to such coupon bonds when
surrendered, and if any such coupons are missing, the subscription must be
accompanied by cash payment equal to the face amount of the missing coupons.^
The bonds must be delivered at the expense and risk of the holder. Facilities for
transportation of bonds by registered mail insured may be arranged between
incorporated banks and trust companies and the Federal Reserve banks, and
holders may take advantage of such arrangements when available, utilizing such
incorporated banks and trust companies as their agents. Incorporated banks and
trust companies are not agents of the United States under this circular.
2. Registered bonds.—First Liberty Loan bonds in registered form tendered in
exchange for Treasury bonds offered hereunder should be assigned by the
registered payee or the assignee thereof, in accordance with the general regulations of the Treasury Department governing assignments for transfer or
exchange, in one of the forms hereafter set forth, and thereafter should be
presented and surrendered with the subscription to a Federal Reserve bank or
to the Treasury Department, Division of Loans and Currency, .Washington, D. 0.
The bonds must be delivered at the expense and risk of the holder. If Treasury
bonds are desired registered in the same name as the First Liberty Loan bonds
surrendered, the assignment should be to " The Secretary of the Treasury for
exchange for Treasury bonds of 1955-60 " ; if Treasury bonds are desired registered in another name, the assignment should be to "The Seqretary of the
Treasury for exchange for Treasury bonds of 1955-60 in the name of
" ; if Treasury bonds in coupon form are desired, the assignment
should be to " The Secretary of the Treasury for exchange for Treasury bonds
of 1955-60 in coupon form to be delivered to —
"
V I . GENEEAL PROVISIONS

1. As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions^ « * *^
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
1 The final coupons attached to temporary coupon bonds of t h e F i r s t Libprty Loan
became due as follows: F i r s t 4's. Dec. 15, 1 9 1 9 ; F i r s t 4 % ' s , J u n e 15, 1920; Firstsecond 414's, Dec. 15, 1920. The holders of any such temporary bonds will receive t h e
p a s t due interest to J u n e 15, 1935, if such bonds a r e tendered for exchange under t h i s
circular.
~ Omitted portion similar to corresponding section of Department Circular No. 524,
p. 184.

220

REPORT OF THE SECEETARY OF THE TREASURY
[Treasury notes, series A-1940.

Department Circular No. 537]
TREASURY DEPARTMENT,

WasMngton, ApHl 22, 1935.
I. EXCHANGE OFFERING OF NOTES

1. The Secretary of the Treasury, p^ursuant to the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, invites subscriptions from the people of the United States for 1% percent Treasury notes of the
United States, designated Treasury notes of series A-1940, in payment of which
only First Liberty Loan bonds, of any series, called for redemption on June 15,
1935, may be tendered. The amount of the additional issue of 1% percent
Treasury notes of series A-1940 under this circular will be limited to the amount
of First Liberty Loan bonds tendered and accepted.
2. First Liberty Loan bonds will be received on exchange at par, and 1%
percent Treasury notes of series A-1940 will be issued at par, with the right
reserved by the Secretary of the Treasury to increase the issue price by public
announcement effective as to subscriptions tendered after the time, not earlier
than April 29, 1935, fixed in the announcement. On all exchanges, interest
adjustments will be made as of June 15, 1935.
3. The outstanding bonds of the First Liberty Loan called for redemption on
June 15, 1935, and which, under the terms of ^this circular, may be exchanged
for 1% percent Treasury notes of series A-1940', follow:
31/2 percent bonds of 1932-47 (First 31/2's) dated June 15, 1917
Converted 4 percent bonds of 1932-47 (First 4's) dated November 15, 1917
Converted 4% percent bonds of 1932-47 (First 4yA's) dated May 9, 1918
Second converted 41%, percent bonds of 1932-47 (First-second 414's) dated
October 24, 1918
4. In addition to the exchange offering under this circular, holders of First
Liberty Loan bonds are offered the privilege of exchanging all or any part of
such called bonds for 2% percent Treasury bonds of 1955^-60, which offering is
set forth in Department Circular No. 536, issued simultaneously with this
circular.
I I . DiESCRiPTIO'N OF N O T E S

1. The notes now offered will be an addition to and will form a part of the
series of 1% percent Treasury notes of series A-1940, issued pursuant to Department Circular No. 532, dated March-4, 1935, are identical in all respects
therewith (except that the additional denomination of $50 will be made available), will be freely interchangeable, and are described in the following
quotation from said Circular No. 532:
(Description omitted here, see p. 203.)
2. Bearer notes with interest coupons attached will be issued in denominations of $50, $100, $500, $1,000, $5,.0O0', $10,000, and $100,000'. The notes wiU
not be issued in registered form.
I I I . .SUBSCRIPTION AND A L L O T M E N T

1. Subscriptions will be received at the Federal Reserve banks and branches
and at the Treasury Department, Washington. Banking institutions generally
will handle applications for subscribers, but only the Federal Reserve banks
and the Treasury Department are authorized to act as official agencies. The
Secretary of the Treasury reserves the right to close the books as to any or all
subscriptions or classes of subscriptions at any time without notice.
2. The Secretary of the Treasury reserves the right to reject any sub'scription,
in whole or in part, to allot less than the amount of notes applied for, to make
allotments in full upon subscriptions for smaller amounts and to make reduced
allotments upon, or to reject, subscriptions for larger amounts, to make classified
allotments or to make allotments upon a graduated scale, or to adopt any or
all of said methods or such other methods of allotment and classification of
allotments as shall be deemed by him to be in the public interest; and his
action in any or all of these respects shall be final. Subject to these reservations, all subscriptions will be allotted in full. Allotment notices will be sent
out promptly upon allotment.

REPORT OF THE SECRETAEY OP THE TEEASURY
IV. T E R M S OF P A Y M E N T A N D

221

ISSUE

1. Treasury notes offered under this circular will be issued at par, or at such
increased issue price as may be fixed by public announcement in the case of
notes issued upon, subscriptions tendered to a Federal Reserve bank or branch
or to the Treasury Department after the time stated in the announcement. The
effective time for any increase which may be made in the issue price will be
after the date of the announcement and in no event earlier than April 29, 1935..
Any such announcement fixing an increase in the issue price and the time when
such increase becomes effective will be communicated promptly to the Federal
Reserve banks. Payment for any notes allotted under this circular may be
made only in First Liberty Loan bonds of any series, which will be accepted at
par, provided that payment of the premium by reason of any increase in the
issue price shall be made as provided in the next following paragraph. The
bonds tendered in payment should accompany the subscription.
2. Interest adjustment as of Jime 15, 1935.—Subscribers will be credited with
interest in full to June 15, 1935, on First Liberty Loan bonds tendered in
exchange, and will be charged with accrued interest from March 15 to June 15,
1935 ($4.0625 per $1,000), on 1% percent Treasury notes of series A-1940
issued on exchange. The net interest adjustment per $1,000 principal amount
on account of the various issues of First Liberty Loan bonds follows: First
31/2's, $13.4375; First 4's, $15.9375; First 414's and First-second 414's, $17.1875.
This net interest adjustment (less any premium by reason of an increase in the
issue price) will be paid to subscribers following acceptance of First Liberty
Loan bonds under this circular.
V. SURRENDER OF F I R S T LIBERTY LOAN BONDS ON

EXCHANGE

1. Coupon bonds.—First Liberty Loan bonds in coupon form tendered in
exchange for Treasury notes offered hereunder, should be presented and surrendered with the subscription to a Federal Reserve bank or to the Treasurer
of the United States. Coupons dated June 15, 1935, and all coupons bearing
dates subsequent to June 15, 1935, should be attached to such coupon bonds
when surrendered, and if any such coupons are missing, the subscription must <
be accompanied by cash payment equal to the face amount of the missing
coupons.^ The bonds must be delivered at the expense and risk of the holder.
Facilities for transportation of bonds by registered mail insured may be
arranged between incorporated banks and trust companies and the Federal
Reserve banks, and holders may take advantage of such arrangements when
available, utilizing such incorporated banks and trust companies as their
agents. Incorporated banks and. trust companies are not agents of the United
States under this circular.
2. Registered bonds.—First Liberty Loan bonds in registered form tendered
in exchange for Treasury notes offered hereunder should be assigned by the
registered payee or the assignee thereof, in accordance with the general regulations of the Treasury Department governing assignments for transfer or
exchange, to " The Secretary of the Treasury for exchange for Treasury notes
of series A-1940", and thereafter should be presented and surrendered
with the subscription to a Federal Reserve bank or to the Treasury Department, Division of Loans and Currency, Washington, D. C. If the Treasury notes are to be delivered for the account of other than the registered
payee or the assignee thereof, the assignment should be to "The Secretary
of the Treasury for exchange for Treasury notes of series A-1940 to be delivered to
" The bonds must be delivered at the expense
and risk of the holder.
VI. GENERAL

PROVISIONS

1. As fiscal agents of the United States, Federal Reserve banks are authorized and requested to receive subscriptions" * * *.
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
8 The final coupons attached to temporary coupon bonds of the F i r s t Liberty Loan
became due as follows: F i r s t 4's. Dec. 15. 1919; F i r s t 4iA's. J u n e 15, 1 9 2 0 ; First-second 4%'s. Dec. 15, 1920. Titleholders of any such temporary bonds will receive the
past due interest to J u n e 15, 1935, if such bonds are tendered for exchange under this
circular.
^ Omitted portion similar to corresponding section of Department Circular No. 522,
p. 181.

222

REPORT OF T H E SECRETARY OF T H E TREASURY

On May 3, 1935, the following announcement was made of an increase in the
issue price of the Treasury bonds of 1955-60, effective as to subscriptions tendered after May 7, 1935.
To Holders of First Liberty Loan Bonds, and Others Concerned:
Public announcement is hereby made that, pursuant to the right reserved by
the Secretary of the Treasury under Department Circular No. 536, dated AprU
22, 1935, inviting subscriptions for 2y8 percent bonds of the United States,
designated Treasury bonds of 1955-60, in exchange for First Liberty Loan bonds
of any series, the issue price of such 2% percent Treasury bonds of 1955-60 is
increased to lOOi/^, effective as to subscriptions tendered after May 7, 1935. The
increased issue price shall not be effective as against subscriptions duly tendered on or before May 7, 1935, including subscriptions received by mail at the
Federal Reserve banks and the Treasury Department, Washington, D. C,
enclosed in envelops postmarked prior to midnight May 7, 1935.
This public announcement shall be communicated promptly to the Federal
Reserve banks.
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
TREASURY D E P A R T M E N T ,

Washington, May 3, 1935.

Exhibit 14
Allotments on exchange subscriptions, Treasu/ry bonds of 1955-60 and Treasury
notes of series A.-1940 (press releases, Apr. 29 and 30, May 4, 6, 13, ^15, and
27, and Aug. 6, 1935)
The subscription books for the offering of Treasury notes of series A-1940
in exchange for First Liberty Loan bonds, called for redemption on June 15, 1935,
closed at the close of business May 2, 1935. The subscription books for the
offering of Treasury bonds of 1955-60, also open to holders of First Liberty
Loan bonds, remained open until the close of business May 23, 1935.
First Liberty Loan bonds were exchanged for Treasury bonds of 1955-60 to
the amount of $746,406,550, and for the Treasury notes of series A-1940 to the
amount of $864,480,000, making total exchanges $1,610,886,550, or more than 83
percent of the total amount of First Liberty Loan bonds outstanding at the
time the refunding was announced. All of the subscriptions were allotted in
full. The subscriptions were divided among the several Federal Reserve
districts and the Treasury as follows:
Federal Eeserve district
Boston
New York
Philadelphia.
Cleveland-.--.
Eichmond
Atlanta
Chicago
St. Louis
Minneapolis..
Kansas City..
Dallas
San Francisco.
Treasury
Total-..

Bonds allotted

Notes allotted

$69, 655, 500
274,134,900
60, 215, 850
74, 224,950
32, 521,350
9, 629,950
91,959, 200
28,099, 700
10, 031, 050
21, 799,400
23, 710, 650
38, 711.700
21.712.350

$66, 661.
515,001,
23,311,
63, 206,
29,967,
3,077,
98,077,
12, 661.
6,223,
7.194,
6,405.
26,108,
8.582,

746,406, 550

864,480,000

Total allotted
$136,316.950
789, 136, 760
73,527,760
137,431,100
62,489,100
12,707.450
190,036, 600
40, 760.750
15,254,860
28,993, 600
30, 116. 560
63,820,150
30,294,960
1.610.886,550

223

REPORT OP THE SECRETARY OF THE TREASURY
Exhibit 15
Refunding of the First Liberty loan, March 15 to June 30, 1935
[On basis of daily Treasury statements (unrevised). see p. 2931
First 31^'s

Balance for cash redemption
Eedeemed to June 30, 1935
Outstanding June 30, 1935

First 414 *s

$1, 392, 226, 260 $5,002,460 $5,32,489,100

Outstanding Mar. 14, 1936
Exchanges for 1 ^ percent Treasury
notes, series A-1940
Exchanges for 2]4 percent Treasury
bonds of 1966-60
Total exchanges .

First 4's

First-second 414 's

Total

$3,492,150 $1,933,209,950
864,480,000

754, 219,100

650,800

108,033, 560

1,576,550

464,946,100

2,190,150

277,864,960

1,406,350

746,406, 660

1, 219,164, 200

2,840, 950

385,898,600

2,982,900

1,610,886, 560

173, 062, 050
98,428, 500

2,161, 600
998,400

146,590, 600
77,843, 250

509,250
251, 600

322, 323, 400. 177,621,750

74,633,550

1,163,100

68, 747,350

257,650

144,801,650

Exhibit 16
Inviting tenders for 3 percent Treasury bonds of 1946-48 (additional)
On May 27, 1935, Secretary of the Treasury Morgenthau invited tenders for
an additional issue of 3 percent Treasury ;bonds of 1946-48 as described in the
following circular:
[Department Circular No. 541]
TREASURY DEPARTMENT,

Washington, May 27, 1935.
The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, offers to the
people of the United States $100,000,000, or thereabouts, 3 percent Treasury
bonds of 1946-48, and invites tenders therefor at not less than par and accrued
interest from December 15, 1934, to June 3, 1935.
DESCRIPTION o r BONDS

The bonds now offered will be an addition to and will form a part of the
series of 3 percent Treasury bonds of 1946-48 issued pursuant to Department
Circular No. 512, dated June 4, 1934; are identical iri all respects therewith
(except that interest on the bonds issued under this circular will accrue from
Dec. 15, 1934) ; will be freely interchangeable; and are described (except as to
interest payable Dec. 15, 1934) in the following- quotation from said circular
no. 512: •
" The bonds will be dated June 15, 1934, and will bear interest from that date
at the rate of 3 percent per annum, payable semiannually, on December 15,
1934, and thereafter on June 15 and December 15 in each year until the principal
amount becomes payable. They will mature June 15, 1948, but may be redeemed at the option of the United States on and after June 15, 1946, in whole
or in part, at par and accrued interest, on any interest day or days, on 4
months' notice of redemption given in such manner as the Secretary of the
Treasury shall prescribe. In case of partial redemption the bonds to be redeemed will be determined by such method as may be prescribed by the
Secretary of the Treasury. From the date of redemption designated in any
such notice, interest on the bonds called for redemption shall cease.
" The bonds shaU be exempt, both as to principal and interest, from all
taxation now or hereafter imposed by the United States, any State, or any
of the possessions of the United States, or by any local taxing authority, except
(a) estate or inheritance taxes, and (b) graduated additional income taxes,
commonly known as surtaxes, and excess-profits and war-profits taxes,
now or hereafter imposed by the United States, upon the income or profits of
individuals, partnerships, associations, or corporations. The interest on an
16816—36-

-16

224

EEPORT OF THE SECEETARY OF THE TREASURY

amount of bonds authorized by the Second Liberty Bond Act, approved September 24, 1917, as amended, the principal of which does not exceed $5,000, owned
by any individual, partnership, association, or corporation, shall be exempt
from the taxes provided for in clause (b) above.
" The bonds will be acceptable to secure deposits of public moneys, and will
bear the circulation privilege only to the extent provided in the act approved
July 22, 1932, as amended. They wiU not be entitled to any privilege of
conversion.
"Bearer bonds with interest coupons attached, and bonds registered as to
principal and interest, will be issued in denominations of $50, $100, $500', $1,000,
$5,000, $10,000', and $100,000', Provision will be made for the interchange of
bonds of different denominations and of coupon and registered bonds, and
for the transfer of registered bonds under rules and regulations prescribed
by the Secretary of the Treasury.
" The bonds will be subject to the general regulations of the Treasury Department, now or hereafter prescribed, governing United States bonds,"
As interest on the bonds issued under this circular will accrue from December
15, 1934, coupon bonds will be delivered hereunder with coupon no. 1, dated
December 15, 1934, detached.
. TE;NDER,S AND

ALLOTMENTS

Tenders will be received at the Federal Reserve banks and the branches
thereof up to 3 p, m,, eastern standard time, Wednesday, May 29, 1935, and
unless received by that time will be disregarded. Tenders will not be received
at the Treasury Department, Washington. Bach tender must state the face
amount of bonds bid for, which must be $1,000 or any even multiple thereof,
and the price offered. The price offered must be stated exclusive of accrued
interest from December 15, 1934, to June 3, 1935; and must be expressed on
the basis of 100, with fractions expressed as 32ds of 1 percent, in accordance
with usual practice; e. g., 103-29'/32. Tenders at less than par will not be
considered.
Tenders will be received without deposit from incorporated banks and trust
companies and from responsible and recognized .dealers in investment securities. Tenders from others must be accoriipanied in every case by a deposit
of 5 percent of the face amount of bonds bid for, except where the tender
is accompanied by an express guaranty of payment by an incorporated bank
or trust company. If the tender is accepted, in whole or in part, the deposit
will be applied toward payment for the bonds, the balance to be paid as
hereinafter provided. If the tender is rejected, the deposit will be returned
to the bidder.
Tenders must be enclosed in envelops, securely sealed, addressed to the
Federal Reserve bank, or branch, of the district, and plainly marked " Tender
for 3 percent Treasury Bonds of 1946-48." The Federal Reserve banks will
supply printed forms and special envelops for submitting tenders. Incorporated
banks and trust companies not located in a city where a Federal Reserve bank
or branch is located may, in their discretion, submit tenders by telegram, but
such telegrams must be received at the Federal Reserve bank or branch before
the time fixed for closing.
Immediately after the closing hour for the receipt of tenders on May 29,
1935, all tenders received in writing or by telegraph at the Federal Reserve
banks or branches thereof up to the closing hour (3 p. m., eastern standard
time) wUl be opened. The Secretary of the Treasury wUl determine the acceptable prices offered and will make public announcement thereof as soon
as possible after the opening of tenders. Those submitting tenders will be
advised by the Federal Reserve banks of the acceptance or rejection thereof,
and payment on accepted tenders must be made as hereinafter provided. In
considering the acceptance of tenders, the highest prices offered wiU be
accepted in full down to the amount required; and if the same price appears
in two or more tenders and it is necessary to accept only a part of the amount
offered at such price, tenders for smaller amounts may be accorded preference
and tenders for larger amounts prorated to the extent necessary in accordance with the respective amounts bid for. The Secretary of the Treasury
expressly reserves the right, however, to reject any or aU tenders or parts
of tenders, and to award less than the amount bid for, and any action he may
take in any such respect or respects shall be final.

REPORT OF THE SECRETARY OF THE TREASURY

225

PAYMENT

Payment for any bonds allotted on accepted tenders must be made or completed on or before June 3, 1935, in cash or other immediately available funds,
and must include the face amount and the premium, if any, which the bidder
has agreed to pay, together with accrued interest on the face amount from
December 15, 1934, to June 3, 1935.^ In every case where payment is not so
completed, the 5 percent deposit with application shall, upon declaration made
by the Secretary of the Treasury in his discretion, be forfeited to the United
States.
GENERAL PROVISIONS

Federal Reserve banks, as fiscal agents of the United States, are authorized
and requested to receive tenders, to make allotments as indicated by the
Secretary of the Treasury to the Federal Reselrve banks of the respective districts, to issue allotment notices, to receive payment for bonds allotted, to make
delivery of bonds on full-paid allotments, and to perform such other acts as
may be necessary to carry out the provisions ofthis circular. Pending delivery
of the definitive bonds, Federal Reserve banks may issue interim receipts.
The Secretary of the Treasury may at any time, or from time to time,
prescribe supplemental or amendatory rules and regulations governing the
receipt of tenders and the sale of bonds under this circular, which will be
communicated promptly to the Federal Reserve banks.
HENRY MORGENTHAU, Jr.,

Secretary of the Treasury.
Exhibit 17
Acceptance of tenders for Treasury bonds of 1946-48 (from press release, May
31, 1935')
On May 31, 1935, Secretary of the Treasury Morgenthau announced the
result of the offering by the Treasury of $100,000,000,' or thereabouts,, of 3
percent Treasury bonds of 1946^8, tenders for which were received at the
Federal Reserve banks up to 3 p. m. on May 29.
iTenders for $270,077,000 face amount of bonds were received, of which $98,708,000 was accepted at prices ranging from 103|-| down to 103^, and accrued
interest from December 15, 1934, to June 3, 1935. Tenders were received for
more than $22,000,000 at 103, and it was deemed inadvisable to allot a small
percentage. The average price of the bonds to be issued was about 103-5%
and a total premium of $3,082,864 would be received. Based on the average
price at which the bonds were to be issued on June 3, 1935, the yield was about
2.67 percent to the earliest call date, June 15, 1946, and about 2.71 percent to
maturity, June 15. 1948.
Exhibit 18
Offering of i % percent Treasury notes of series B-1940
On June 10, 1935, Secretary of the Treasury Morgenthau offered for subscription 1% percent Treasury notes of series B-1940 in exchange for 3 percent
Treasury notes of series A-1935 and for 1% percent Treasury notes of series
B-1935. In the related press release it "was stated that about $416,600,000 of
the notes of series A-1935 would mature on June 15, 1935, and about $353,800,000
of notes of series B-1935 would mature on August 1. 1935.
[Department Circular No. 542]
TREASURY DEPARTMENT,

Washington, June 10, 1935:
The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, approved September 24,1917, as amended, invites subscriptions.
1 Accrued interest from Dec. 15, 1934, to June 3, 1935, on $1,000 face amount is
$14.010989.
2 Eevised June 3, 1935.

226

REPORT OF THE SECRETARY OF THE TREASURY

at par and accrued interest, from the people of the United States, for 11/2
percent notes of the United States, designated Treasury notes of series B-1940,
in payment of which only Treasury notes of series A-1935, maturing June
15, 1935, or Treasury notes of series B-1935, maturing August 1, 1935, may be
tendered. The amount of the offering under this circular will be limited to the
amount of Treasury notes of series A-1935 and of series B-1935 tendered
and accepted.
DESCRIPTION OF NOTES

The notes will be dated June 15, 1935, and will bear interest from that date at
the rate of 1% percent per annum, payable semiannually, on December 15, 1935,
and thereafter on June 15 and December 15 in each year. They will mature
June 15, 1940, and will not be subject to call for redemption prior to maturity.
The notes shall be exempt, both as to principal and interest, from all taxation
(except estate or inheritance taxes ^) now or hereafter imposed by the United
States, any State, or any of the possessions of the United States, or by any local
taxing authority.^ * * *
APPLICATION AND ALLOTMENT

Payment at par and accrued interest, if any, for notes allotted hereunder
must be made on or before June 15, 1935, or on later allotment, and may be
made only in 3 percent Treasury notes of series A-1935, maturing June 15,
1935, or in 1% percent Treasury notes of series B-1935, maturing August 1,
1935, which will be accepted at par, and should accompany the subscription.
In the case of Treasury notes of series B-1935 tendered in payment, coupons
dated August 1, 1935, must be attached to the notes when surrendered, and
accrued interest to June 15, 1935,^ will be paid following acceptance of the
notes for exchange.
GENERAL PROVISIONS

As fiscal agents of the United States, Federal Reserve banks are authorized
and requested to receive subscriptions * * *^
HENRY MORGEINTHAU,

Jr,,

Secretary of the Treasury.
Exhibit 19
Allotments on exchange subscriptions. Treasury notes of series B-1940 (from,
press releases, June 12 and 18, 1935*)
The subscription books for the offering of 1% percent Treasury notes of series
B-1940 closed at the close of business June 13, 1935, Subscriptions for these
1 Similarly, the exemption does not apply to the gift tax, see Treasury Decision
4550, p. 252.
2 Omitted portions similar to corresponding sections of Department Circular No. 522,
p. 181.
3 Accrued interest a t 1% percent from Feb. 1, 1935, to J u n e 15, 1935, on $1,000 is
$6.015193.
^ Eevised Aug. 6, 1935.

REPORT OP T H E

SECBETARY OP T H E

227

TREASURY

notes, which were open only to holders of Treasury notes maturing June 15
and August 1, 1935, amounted to $738,428,400, of which $402,741,800 was ex<ihanged for the notes of series A-1935, maturing June 15; and $335,686,600
was exchanged for the notes of series B-1935, maturing August 15. The subscriptions, which were allotted in full, were divided among the several Federal
Reserve districts and the Treasury as follows:
Subscriptions
received (June
notes)

Federal Eeserve district

Boston
New York
Philadelphia..
Cleveland
Eichmond
Atlanta..
Chicago..
St. Louis
Minneapolis.Kansas City..
Dallas
Sari Francisco.
Treasury

469,600
051,200
152, 200
518,900
609,900
198, 000
304, 700
896,700
938,700
837, 200
387,700
434, 500
943, 600

Total...

402, 741,800

Subscriptions
received (August notes)

Total subscriptions received
and allotted
$13,650,900
567, 294,900
13, 652, 500
11, 621,000
26,336,000
8, 538, 000
66,961,800
12,964,100
3, 685,700
8, 465,900
• 2, 747, 600
10,921, 600
2, 688, 600

$6,181,300
268, 243, 700
3, 600, 300
2,102,100
3, 726,100
8, 340,000
32, 657,100
5, 068,400
647,000
3, 628, 700
369,800
487,100
745, 000
335,686, 600

738,428.400

Exhibit 20
Inviting tenders for 3 percent Treasury bonds of 1946-48 (additional)
On June 24, 1935, Secretary of the Treasury Morgenthau invited tenders for
an. additional issue of 3 percent Treasury bonds of 19'46-4S, as described in the
following circular:
[Department Circular No. 544]
TREASURY DEPARTMENT,

The SecretaiT of the Treasury, pursuant
Liberty Bond Act, approved September 24,
people of the United States $100',00O,000i, or
bonds of 1946-48, and invites tenders therefor
interest from June 15, 1935, to July 1, 1935.

Washington, June 24, 1935.
to the authority of the Second
1917, as amended, offers to the
thereabouts, 3 percent Treasury
at not less than par and accrued

DESCRIPTION OF BONDS

The bonds now offered will be an addition to and will form a part of the
series of 3 percent Treasury bonds of 1946-48 issued pursuant to Department
Circulars No. 512, dated June 4, 1934, and No. 541, dated May 27, 1935; wiU
be freely interchangeable therewith; and (with the exception that interest on
the bonds issued under this circular will accrue from June 15, 1935) are
identical in all respects therewith and are described in the following quotation
from Department Circular No. 512: [Description omitted here, seep. 223.]
As interest on the bonds issued under this circular will accrue from June 15,
19'35, coupon bonds will be delivered hereunder with coupons nos. 1 and 2, dated
December 15, 1934, and June 15, 1935, respectively, detached.
TBND'ER,& AND ALLOTMENTS

Tenders will be received at the Federal Reserve banks and branches thereof
up^to 12 o'clock noon, eastern standard time, Wednesday, June 26, 1935, and
unless received by that time will be disregarded. Tenders will not be received
at the Treasury Department, Washington. Each tender must state the face
amount of bonds bid for, which must be $1,000 or any even multiple thereof, and
the price offered. The price offered must be stated exclusive of accrued interest
from June 15, 19'35, to July 1, 1935; and must be expressed on the basis of IOO,
with fractions expressed as 32ds of 1 percent, in accordance with usual practice,
e. g., 103-16/32. Tenders at less than par wiU not be considered.^ * * *
1 Omitted portions
541, p. 223.

similar

to corresponding

sections

Department

Circular

No.

228

REPORT OF THE SECRETAEY OF THE TREASURY

Immediately after the closing hour for the receipt of tenders on June 26, 1935,
all tenders received in writing or by telegraph at the Federal Reserve banks or
branches thereof up to the closing hour (12 o'clock noon, eastern standard time)
will be opened. * * *
PAYMENT

Payment for any bonds allotted on accepted tenders must be made or completed on or before July 1, 1985, in cash or other immediately available funds,
and must include the face amount, and the premium which the bidder has agreed
to pay, together with accrued interest on the face amount from June 15, 1935,
to July 1, 1935." In every case where payment is not so completed, the 5 percent
deposit with application shall, upon declaration made by the Secretary of the^
Treasury in his discretion, be forfeited to the United States.
GENERAL PROVISIONS

Federal Reserve banks, as fiscal agents of the United States, are authorized
and requested to receive tenders ^ * *.
HENRY MORGENTHAU, Jr.,

Secretary of the Treasury.
Exhibit 21
Acceptance of tenders for Treasury bonds of 1946-48 (from press release, June
27, 1935)
On June 27, 1935, Secretary of the Treasury Morgenthau announced the
result of the offering by the Treasury on June 24 of $100,000,000, or thereabouts, of 3 percent Treasury bonds of 1946-48, tenders for which were received
at the Federal Reserve banks up to 12 o'clock noon on Wednesday, June 26.
Tenders for $461,341,000 face aniount of bonds were received, of which
$112,669,000 was accepted at prices ranging from 103-24/32 down to 103-17/32
and accrued interest from June 15 to July 1, 1935. The average price of the
bonds to be issued was about 103-18/32, and a total premium of $4,005,378
was to be received. Based on the average price at which the bonds were to
be issued on July 1, 1985, the yield was about 2,62 percent to the earliest
call date, June 15, 1946, and about 2,67 percent to maturity, June 15, 1948.

Issues of Treasury bills
Exhibit 22
Inviting tenders for Treasury bills dated July 3, 1934, and maturing January 2^
1935
TREASURY DEPARTMENT,

Washington, June 27, 1934.
The Secretary of the Treasury gives notice that tenders are invited for
Treasury bills to the amount of $75,000,000, or thereabouts. They will be
183-day bills, and will be sold on a discount basis to the highest bidders.
Tenders will be received at the Federal Reserve banks, or the branches thereof,
up to 2 p. m. eastern standard time, on Friday, June 29, 1934. Tenders will
not be received at the Treasury Department, Washington,
The Treasury bills will be dated July 3, 1934, and will mature on January 2,
1935, and on the maturity date the face amount will be payable without
interest. They will be issued in bearer form only, and in amount or denominations of $1,000, $10,000, $100,000, $500,000, and $1,000,000 (maturity value).
It is urged that tenders be made on the printed forms and forwarded in
the special envelops which will be supplied by the Federal Reserve banks
or branches upon application therefor.
2 Accrued interest from June 15, 1935, to July 1, 1935, on $1,000 face amount is
$1.311475.

REPORT OP THE SECRETARY OP THE TREASURY

229

No tender for an amount less than $1,000 will be considered. Each tender
must be in multiples .of $1,000. The price offered must be expressed on the
basis of 100, with not more than, three decimal places, e. g., 99,125. Fractions
must not be used.
Tenders will be accepted without cash deposit from incorporated banks
and trust companies and from responsible and recognized dealers in investment
securities. Tenders from others must be accompanied by a deposit of 10
percent of the face amount of Treasury bills applied for, unless the tenders
are accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour for receipt of tenders on June 29, 1934,
all tenders received at the Federal Reserve banks or branches thereof up to
the closing hour will be opened and public announcement of the acceptable
prices will follow as soon as possible thereafter, probably on the following
morning. The Secretary of the Treasury expressly reserves the right to reject any or all tenders or parts of tenders, and to allot less than the amount'
applied for, and his action in any such respect shall be final. Those submitting tenders will be advised of the acceptance or rejection thereof. Payment
at the price offered for Treasury bills allotted must be made at the Federal
Reserve banks in cash or other immediately available funds on July 3, 1934.
The Treasury bills will be exempt, as to principal and interest, and any
gain from the sale or other disposition thereof will also be exempt, from all
taxation, except estate and inheritance taxes. No loss from the sale or other
disposition of the Treasury bills shall be allowed as a deduction, or otherwise
recognized, for the purposes of any tax now or hereafter imposed by the United
States or any of its possessions.
Treasury Department Circular No. 418, as amended, and this notice prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any ^Federal Reserve bank or branch
thereof.
Exhibit 23
Acceptance of tenders for Treasury bills dated July 3, 1934, and maturing
January 2, 1935 (press release, June 30, 1934)
Secretary of the Treasury Morgenthau announced on June 29, 1934, that
the tenders for $75,000,000, or thereabouts, of 183-day Treasury bills, dated
July 3, 1934, and maturing January 2, 1935, which were offered on June 27,
were opened at the Federal Reserve banks on June 29, 1934.
The total amount appUed for was $205,138,000, of which $75,167,000 was
accepted. The accepted bids ranged in price from 99.980, equivalent to a rate
of about 0.04 percent per annum, to 99.960, equivalent to a rate of about 0.08
percent per annum on a bank discount basis. Only part of the amount bid for
at the latter price was accepted. The average price of Treasury bills to be
issued is 99.964 and the average rate is about 0.07 percent per annum on a bank
discount basis.
Exhibit 24
Press releases pertaining to Treasury bill issues during the fiscal year 1935
were similar in form to the foregoing and are, therefore, not here reproduced.
The essential details regarding each issue are summarized in the following
table.

230

REPORT OP THE SECRETARY OP THE TREASURY

Summary of information contained i/n press releases issued in connection with
Treasury bills offered during the fiscal year 1935
B i d s accepted

D a t e of issue

1934
July 3
J u l y 11
July 18.. J u l y 26
A u g . l-_
Aug. 8...
A u g . 16
Aug. 22..
A u g . 29
Sept. 6
Sept. 12. _
S e p t . 19. _
S e p t . 26-_
Oct. 3 . . , .
Oct. 10
Oct. 17.
Oct. 24
O c t . 31
Nov. 7
N o v . 14
N o v . 21.
N o v . 28
Dec. 5
D e c . 12
D e c . 19
D e c . 26Jan.2__
Jan. 9
J a n . 16.
J a n . 23
J a n . 30
Feb. 6
F e b . 13
Feb. 20.
F e b . 27-

1935
. -

Mar. 6
M a r . 13. „
M a r . 20
M a r . 27
Apr. 3
A p r . 10
A p r . 17
A p r . 24
Mayl
May 8 .
M a y 15
ISlay 22
M a y 29
June 5
J u n e 12
J u n e 19
J u n e 26

D a t e of m a t u r i t y

1935
Jan. 2
Jan. 9
J a n . 16
J a n . 23
J a n . 30
F e b . 6.
Feb. 13..-.
F e b . 20
F e b . 27
Mar.6
M a r . 13
. . .
M a r . 20
M a r . 27
Apr. 3
.A p r . 10-.A p r . 17 _
A p r . 24
Mayl
May 8
M a y 15
M a y 22
M a y 29
June 5
J u n e 12
J u n e 19
J u n e 26 - - _
July 3
July 10—
J u l y 17.
.
J u l y 24
J u l y 31
Aug. 7
A u g . 14
A u g . 21
/ A u g . 28
[ N o v . 27
/Sept. 4
iDec. 4
/Sept. if
1-\ D e c . 11
/ S e p t . 18
\ D e c . 18
/ S e p t . 26
\ D e c . 24
D e c . 31
1936 a n d 1936
J a n . 8, 1936
Jan.15.1936
J a n . 22. 1936
J a n . 29, 1936_.
F e b . 5, 1936
. . . „ • . . F e b . 11, 1936
/ O c t . 2, 1935
\ F e b . 19, 1936
/ O c t . 9, 1935
\ F e b . 26, 1936
/ O c t . 16, 1935
\ M a r . 4,1936
/ O c t . 23, 1935
[ M a r . 11.1936
/ O c t . 30. 1936
\ M a r . 18,1936
/ N o v . 6. 1935
\ M a r . 25,1936

Days
to m a turity

Lowest

Highest

EquivaPrice
EquivaPrice
(per h u n - lent r a t e i (per h u n - l e n t r a t e i
(percent)
(percent)
dred)
dred)

183
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182
182.

$206,138
208, 743
207,015
157,856
115, 497
108,633
201,491
254,800
299,186
342,426
244,980
150,849
194, 266
243,169
232, 204
237, 719
205, 632
198,826
168, 030
199, 237
208, 855
314,910
236, 905
302, 273
333.129
229, 299

$99.980
99.980
99.970
99.976
99. 975
99. 965
99. 949
99. 906
99.900
99. 914
99. 925
99.907
2 99.879
99. 879
99. 905
99. 909
99. 910
99. 914
99. 909
99. 914
3 99. 909
99. 904
99. 900
99. 909
4 99. 939
99. 950

0.039
.040
.059
.049
.049
.069
.101
.186
.198
.170
.148
.184
,239
,239
,188
.180
,178
.170
.180
.170
.180
.190
.198
.180
.120
.099

$99.960
99.962
.99.963
99.963
99. 949
99. 930
99.848
99. 876
99. 886
99.907
99.874
99. 840
99. 843
99.844
99. 871
99.889
99.894
99.899
99. 884
99. 881
99.890
99. 880
99.886
99.896
99. 915
99. 937

0.079
.076
.073
.073
.101
.138
.301
.247
.225
.184
.249
.316
.311
.309
.266
.220
.210
.200
.229
.236
.218
.237
.227
.206
.168
.126

182
182
182
182
182
182
182
182
182
273
182
273
182
273
182
273
182
272
272

214.130
141, 685
142, 359
232, 673
203,618
262,985
196,853
166,644
120, 712
166,180
152,020
157, 560
129, 722
120, 616
104, 670
67,406
108, 329
li7,186
119,428

99. 961
99. 970
99. 960
99.950
99. 960
99.950
99,965
8 99. 956
99. 961
99. 911
99. 955
99. 909
99.976
99.925
99. 966
6 99.901
6 99. 960
99. 895
99.900

.097
.069
.079
.099
.079
.099
.069
.870
.077
.117
.089
.120
.049
.099
.069
.131
.079
.139
.132

99. 942
99. 936
99. 914
99. 921
99. 928
99.937
99.941
99. 935
99.942
99. 872
99. 946
99. 886
99.949
99.887
99.948
99.883
99.936
99. 863
99. 867

.115
.127
.170
.156
.142
.125
.117
.129
.115

273
273
273
273
273
272
133
273
133
273
133
273
133
273
133
273
133
273

109,147
124,413
115,059
213,212
165,006
160, 256
109,289
114, 552
70,001
118,922
67, 548
71. 630
153,319
106, 569
139,654
134,793
137, 643
135.365

99.898
99.884
99. 886
7 99, 887
99. 975
99. 902
99. 970
99. 900
99. 974
6 99. 898
99. 964
99. 896
99.970
99. 895
99.980
99.910
99.978
99.911

.136
.153
.152
.149
.033
.130
.081
.132
.070
.135
,097
.137
.081
.138
.064
.119
.060
.117

99.857
99. 860
99. 865
99.884
99. 881
99. 889
99. 965
99. 885
99. 962
99. 887
99..968
99.877
99. 963
99.883
99. 967
99. 892
99.972
99.903

.189
.185
.178
.153
.157
.147
.095
.162
.103
.149
.114
.162
.100
.154
.089
.142
.076
.128

1 Bank discount basis.
2 Except for 1 bid of $65,000 at 99.935,
3 Except for 4 bids aggregating $17,000.
< Except for 1 bid of $20,000.

Total
amount
applied
for (in
thousands)

8 Except for 2 bids totalling $24,000.
6 Except for 1 bid of $10,000.
7 Except for 1 bid of $30,000.

.107
.101
.103
. 164
.127
.176

231

REPORT OP THE SECRETARY OP THE TREASURY

Summary of information contained in press releases issued in connection ^oith
Treasury bills offered during the fiscal year 1935—Continued
B i d s accepted
Average
D a t e of is^iiA
Amount
(in t h o u sands)

Price
(per
hundred)

Equivalent
rate i
(percent)
1934

1934

1934
July 3 J u l y 11
J u l y 18., J u l y 26.
Aug. 1
Aug. 8 . .
A u g . 16
A u g . 22.
A u g . 29 - _ .
Sept, 6.
Sept. 12.- .
Sept. 1 9 . - . .
Sept. 26 Oct. 3
_
Oct. 10
Oct. 17
Oct. 24
Oct. 31
Nov. 7
N o v . 14
Nov. 21..
N o v . 28
Dec. 5
D e c . 12
D e c . 19
D e c . 26

D a t e of
closing

D a t e of press releases

$99,964
$75,167
99.966
75, 235
99.965
75,144
99. 966
76, 200
75,026 1 99.957
99. 942
75, 327
99.875
75, 320
75. 090
99.885
75,065
99.889
75, 290
99. 908
75, 365
99.886
75, 041
99.857
75, 023
99.855
76,038
99. 857
75, 360
99.881
75,248
99.894
75,102
99. 900
75,015
99. 905
75,076
99. 893
75,046
99.889
75,168
99. 895
75. 287
99. 886
75,139
99. 889
75,079
99. 900
75,020
99. 921
75, 300
99. 942

„ ^
_

0.070
.068
.069
.067
.085
.115
.248
.227
.219
.181.226
. 282
.286
.284
.236
.209
.198
.189
.212
.220
.208
.226
.219
.198
.165
.116

J u n e 29.
J u l y 9.
J u l y 16.
J u l y 23,
J u l y 30.
Aug. 6.
Aug. 13.
Aug. 20.
A u g . 27.
A u g . 31.
Sept. 10.
Sept. 17.
Sept. 24.
Oct. 1,
Oct. 8.
Oct. 15.
Oct. 22,
Oct. 29.
N o v . 2.
N o v . 9.
N o v . 19.
N o v . 26.
D e c . 3.
. D e c . 10.
Dec. 17.
D e c . 21.

J u n e 27 a n d 30
J u l y 6 a n d 10
J u l y 13 a n d 17
J u l y 20 a n d 2 4 ..J u l y 27 a n d 31
Aug. 3 and 7
A u g . 10 a n d 14
A u g . 17 a n d 21
A u g . 24 a n d 28
A u g . 29 a n d Sept. 1
Sept. 7 a n d 11
Sept. 14 a n d 18.
Sept. 21 a n d 25
Sept. 28 a n d Oct. 2
Oct. 5 a n d 9
Oct. 12 a n d 16
Oct. 19 a n d 23
Oct. 26 a n d 30
Nov. 1 and 3._
N o v . 7 a n d 10
N o v . 16 a n d 20
N o v . 23 a u d 27
N o v . 30 a n d D e c . 4
D e c . 7 a n d 11
D e c . 14 a n d 18
D e c . 19 a n d 22

1935
Jan. 2

75.150

99. 949

.101

D e c . 26 a n d 29

Jan. 9
J a n . 16
J a n . 23.
J a n . 30
Feb. 6
F e b . 13
F e b . 20
F e b . 27

75.186
75.079
75,129
.
75.106
75.185
.-..
76,112
75,024
/ 60.064
\ 50.185
/ 50.114
1 50,072
/ 50,052
1 50,149
/ 50,125
I 50,006
/ 50,079
„..
\ 50,071
, 50,018
50, 062
50, 020
50,155
50,085
50,091
50,255
/ 60.063
\ 60,020
/ 60,021
_
\ 50,037
/ 60,013
I 50,010
/ 50,009

Mar. 6
M a r . 13
M a r . 20
M a r . 27
Apr. 3
A p r . 10
A p r . 17
A p r . 24
May 1
May 8 ...
M a y 16
M a y 22
M a y 29
J u n e 6J u n e 12

1 60,080

J u n e 19
J u n e 26

__. /
I
/
I

I Bank discount basis.

50,013
50,059
50,000
50,010

99.942
99. 926
99. 927
99. 931
99. 939
99.944
99.941
99. 946
99.874
99.949
99. 889
99.953
99.893
99.953
99.889
99.946
99.864
99.882
99.867
99.866
99.872
99.884
99.885
99. 892
99.967
99.889
99.965
99.896
99.961
99.887
99.965
99.888
99.969
99.898
99.974
99.907

.116
.145
.145
.136
.120
.110
.117
.108
.166
.100
.147
.094
.141
.094
.147
.109
,180
.167
.176
.176
.169
.153
.152
.143
.088
.146
,095
.137
.105
.149
.096
.148
.083
. 134
.070
.123

Jan. 4 and 8
J a n . 11 a n d 16
J a n . 18 a n d 22
J a n 25 a n d 29
Feb. 1 and 6
Feb. 6 and 9
F e b . 16 a n d 19
J F e b . 22 a n d 26
/Mar. 1 and 5

J a n . 7,
J a n . 14.
J a n . 21.
J a n . 28.
F e b . 4.
F e b . 8.
F e b . 18.
F e b . 26. •

[ M a r . 8 a n d 12

- M a r . 4.

. . ___

}May24and28

M a r . 11.
M a r . 18.

>Mar. 15 a n d 19
J M a r . 22 a n d 26
M a r . 29 a n d A p r . 2
Apr 5 and 9
A p r . 12 a n d 16
A p r 19 a n d 23
A p r . 26 a n d 30
M a y 3 and 7
M a y io a n d 14
|Mayl7and21

Dec. 28.
1935

1935

M a r . 25.
A p r . 1.
A p r . 8.
A p r . 15.
A p r . 22.
A p r . 29.
M a y 6.
M a y 13.
M a y 20.
M a y 27.

/ M a y 29 a n d J u n e 1

M a y 31.

>June 7 a n d 11

J u n e 10.

/ J u n e 14 a n d 18

J u n e 17.

[ j u n e 21 a n d 25

J u n e 24.

232

EEPORT OF THE SECRETAEY OF THE TEEASUEY

Issues and redemptions of bonds of Government agencies guaranteed as to
interest and principal by the United States
Exhibit 25
Inviting tenders for Federal Farm Mortgage Corporation 3 percent bonds of
1944-49
On July 23, 1934, the Secretary of the Treasury, on behalf of the Federal
Farm Mortgage Corporation, invited tenders for bonds of the Corporation, as
described in the following circular:
[Department Circular No. 515]
TREASURY DEPARTMENT,

Washington, July 23, 1934.
The Secretary of the Treasury, on behalf of the Federal Farm Mortgage
Corporation, offers to the public $100,000,000, or thereabouts, 3 percent bonds of
1944r-49 of the Federal Farm Mortgage Corporation, and invites tenders therefor, tlirough the Federal Reserve banks, at not less than par and accrued interest from May 15 to August 1, 1934.
D E S C R I P T I O N OF BONDS

The bonds of this issue are dated May 15, 1934, and bear interest at the rate
of 3 percent per annum, payable semiannually, on May 15 and November 15
of each year, until the principal amount becomes payable. These bonds will
mature May 15, 1949. All or any part of this issue of bonds may be redeemed
at par and accrued interest on May 15, 1944, or on any subsequent interestpayment date. In the event of any such redemption, notice thereof wUl be
given in such manner as the Board of Directors of the Corporation may prescribe. Interest ceases to accrue on any bond after the redemption date of
which notice is so given, whether the bond is then surrendered or not.
Bearer bonds, with interest coupons attached and bonds registered as to
principal and interest are issued in denominations of $100, $500, $1,000, $5,000,
and $10,000. Exchanges of denominations and of registered for coupon or
coupon for registered bonds may be made through any Federal Reserve bank
or at the Division of Loans and Currency of the United States Treasury, Washington, D. C, and through any other agency designated for the purpose by the
Federal Farm Mortgage Corporation,
These bonds are issued under the authority of the Federal Farm Mortgage
Corporation Act, approved January 31, 1934, as amended, which provides that
these bonds and the income derived therefrom shall be exempt from Federal,
State, municipal, and local taxation (except surtaxes, estate, inheritance, and
gift taxes).
Section 16(a) of that act contains the following provisions: "The first'sentence of the eighth paragraph of section 13 of the Federal Reserve Act, as
amended, is further amended by inserting before the semicolon after the words
* Section 13(a) of this act' a comma and the following: ' o r by the deposit or
pledge of Federal Farm Mortgage Corporation bonds issued under the Federal
Farm Mortgage Corporation Act'." Thus, the bonds are legally acceptable to
secure 15-day borrowings from the Federal Reserve banks. However, they do
not have the circulation privilege.
Section 4 of the Federal Farm Mortgage Corporation Act, as amended, also
provides as follows: " * * * Such bonds shall be fully and unconditionally
guaranteed both as to interest and principal by the United States and such
guaranty shall be expressed on the face thereof, and such bonds shall be lawful
investments, and may be accepted as security, for all fiduciary, trust, and public
funds the investment or deposit of which shall be under the authority or control of the United States or any officer or officers thereof. In the event that
the Corporation shall be unable to pay upon demand, when due, the principal
of, or interest on, such bonds, the Secretary of the Treasury shall pay to the
holder the amount thereof which is hereby authorized to be appropriated, out of
any mpneys in the Treasury not otherwise appropriated, and thereupon to the
extent of the amount so paid the Secretary of the Treasury shall succeed to all
the rights of the holders of such bonds. * * * "
i

REPORT OP THE SECRETARY OF THE TEEASURY

233

TENDERS AND ALLOTMENTS

Tenders will be received at the Federal Reserve banks and the branches
thereof up to 2 p. m., eastern standard time, Wednesday, July 25, 1934, and
unless received by that time will be disregarded. Tenders will not be received
at the Treasury Department, Washington. Each tender must be in multiples of
SIOO, must state the face amount of bonds applied for, and the price offered.
The price offered (not less than par) must be expressed on the basis of 100
with not more than three decimal places, e. g., 101.125. The price offered must
be stated exclusive of accrued interest from May 15 to August 1, 1984. Tenders
at less than par will not be considered.
Tenders will be accepted without deposit from incorporated banks and trust
comiDanies and from responsible and recognized dealers in investment securities.
Tenders from others must be accompanied in every case by a deposit of 5 percent
of the face amount of bonds bid for, except where the tender is accompanied by
an express guaranty of payment by an incorporated bank or trust company. If
the tender is accepted, any deposit will be applied toward payment for the bonds,
the balance to be paid as hereinafter provided. If the tender is rejected, any
deposit will be returned to the bidder.
Tenders must be enclosed in envelops, securely sealed, addressed to the Federal Reserve bank or branch of the district, and plainly marked " Tender for
3 percent bonds of Federal Farm Mortgage Corporation. The Federal Reserve
banks will supply printed forms and special envelops for submitting tenders.
Immediately after the closing hour for the receipt of tenders on July 25, 1934,
aU tenders received at the Federal Reserve banks or branches thereof up to ttie
closing hour will be opened. The Secretary of the Treasury will determine the
acceptable prices offered and will make public announcement thereof as soon
as possible after the opening of tenders. Those submitting tenders will be advised by the Federal Reserve banks of the acceptance or rejection thereof, and
payment on accepted tenders must be made as hereinafter provided. In considering the acceptance of tenders, the highest prices offered will be accepted in
full down to the amount required, and if the same price appears in two or more
tenders and it is necessary to accept only a part of the amount offered at such
price, the amount accepted at such price will be prorated in accordance with
the respective amounts bid for. However, the Secretary of the Treasury expressly reserves the right to reject any or all tenders or parts of tenders, and
to award less than the amount bid for, and any action he may take in any such
respect or respects shall be final.
PAYMENT

Payment for any bonds allotted on accepted tenders must be made or com^
pleted on or before August 1, 1934, in cash or other immediately available funds,
and must include the face amount and the premium, if any, which the bidder
has agreed to pay, together with accrued interest on the face amount from May
15 to Augusj: 1, 1934.^ In every case where payment is not so completed, the
5 percent payment with application shall, upon declaration by the Secretary of
the Treasury in his discretion, be forfeited to the United States.
GENERAL PROVISIONS

Federal Reserve banks, as fiscal agents of the United States, are authorized
and requested to receive tenders, to make allotments as indicated by the Secretary of the Treasury to the Federal Reserve banks of the respective districts, to
issue allotment notices, to receive payment for bonds allotted, to make delivery
of bonds on full-paid allotments, and to perform such other acts as may be
necessary to carry out the provisions of this circular. Pending delivery of the
definitive bonds, Federal Reserve banks may issue interim receipts.
The Secretary of the Treasury may at any time, or from time to time, prescribe supplemental or amendatory rules and regulations governing the receipt
of tenders and the sale of bonds under this circular, which will be promptly
communicated to the Federal Reserve banks.
T. J. COOLIDGE,

Acting Secretary of the Treasury.
1 Accrued interest from May 15 to Aug. 1, 1934, on $1,000; face amount is' $6.358695.

234

REPORT OP THE SECRETARY OF THE TREASURY
Exhibit 26

Acceptance of tenders for Federal Farm Mortgage Corporation bonds of 1944-49
(from press release, July 26, 1934, revised^)
Acting Secretary of the Treasury Coolidge announced the result of the offering by the Treasury of $100,000,000 of 10^15 year, 3 percent bonds of the Federal Farm Mortgage Corporation, tenders for which were received at the Federal Reserve banks up to 2 p. m., July 25.
Tenders for $194,856,600 face amount of bonds were received, of which $100,045,300 was accepted at prices ranging from 102.250 down to 100.438, and accrued interest from May 15 to August 1, 1934. Only 10 percent of the amount
tendered at the latter price was accepted. The average price of the bonds to be
issued was 100.559, and a total premium of $558,291 was to be received. Based
on the average prices at which the bonds were to be issued on August 1, 1934,
the yield was about 2,92 percent to the earliest call date, May 15, 1944, and
about 2,95 percent to maturity, May 15, 1949.
Exhibit 27
Inviting tenders for Home Owners^ Loan Corporation bonds, series C, 1936
(Jf% percent), series D, 1937 ( 1 % percent), and series E, 1938 (2 percent)
On August 6, 1984, Secretary of the Treasury Morgenthau, on behalf of the
Home Owners' Loan Corporation, invited tenders for three issues of bonds of
the Corporation, as described in the following circular':
[Department Circular No. 516]
TREASURY DEPARTMENT,

Washington, August 6, 1934.
The Secretary of the Treasury, on behalf of the ITome Owners' Loan Corporation, offers to the public not to exceed $150,000,000 of bonds of the Home
Owners' Loan Corporation, in three series of not to exceed $50,000,000 each,
and invites tenders therefor, through the Federal Reserve banks.
DESCRIPTION OF BONDS

Series C, 1936, for not to exceed $50,000,000.—The bonds of this series will
be dated August 15, 1934, and will bear interest from that date at the rate of
1% percent per annum. They will mature August 15, 1936, and will not be
subject to call for redemption prior to maturity.
Se7'ies D, 1937, for not to exceed $50,000,000.—The bonds of this series will
be dated August 15, 1934, and will bear interest from that date at the rate of
1% percent per annum. They will mature August 15, 1937, andxwill not be
subject to call for redemption prior to maturity.
Series E, 1938, for not to exceed $50,000,000.—The bonds of this series wiU
be dated August 15, 1934, and will bear interest from that date at the rate of
2 percent per annum. They will mature August 15, 1938, and will not be
subject to call for redemption prior to maturity.
Bearer bonds with interest coupons attached will be issued in denominations of $100, $500, $1,000, $5,000, $10,000, and $100,000.' The bonds wiU not
be issued in registered form. Provision will be made for the interchange of
bonds of different denominations of the same series, without charge by the
Corporation, under rules and regulations prescribed by the Corporation.
These bonds are issued under the authority of the Home Owners' Loan Act
of 1933, as amended, which provides that these bonds shall be exempt, both
as to principal and interest, from all taxation (except surtaxes, estate, inheritance, and gift taxes) now or hereafter imposed by the United States or any
district. Territory, dependency, or possession thereof, or by any State, county,
municipality, or local taxing authority.
1 Revised July 31, 1934.
2 The denominations of $100, $500, $1,000, and $5,000 will be initially available, and
those of $10,000 and $100,000 will be available after Sept. 1, 1934.

REPORT OP THE SECRETARY OP THE TREASURY

235

The bonds are acceptable at face value in payment of indebtedness due the
Home Owners' Loan Corporation. They are also acceptable to secure 15-day
borrowings from the Federal Reserve banks, but do not bear the circulation
privilege.
Section 4 (c) of the Home Owners' Loan Act of 1933, as amended, provides
as follows: '' * * * Such bonds shall be fully and unconditionally guaranteed both as to interest and principal by the United States, and such guaranty
shall be expressed on the face thereof, and such bonds shall be lawful investments, and may be accepted as security for aU fiduciary, trust, and public
funds, the investment or deposit of which shall be under the authority or
control of the United States or any officer or officers thereof. In the event that
the Corporation shall be unable to pay upon demand, when due, the principal
of, or interest on, such bonds, the Secretary of the Treasury shall pay to the
holder the amount thereof which is hereby authorized to be appropriated out
of any moneys in the Treasury not otherwise appropriated, and thereupon to
the extent of the amount so paid the Secretary of the Treasury shall succeed
to all the rights of the holders of such bonds. * * * "
TENDERS AND ALLOTMENTS

Tenders will be received at the Federal Reserve banks and the branches
thereof up to 2 p. m., eastern standard time, Wednesday, August 8, 1934, and
unless received by that time will be disregarded. Tenders will not be received
at the Treasury Department, Washington. Bidders will be required to specify
the particular series for which each tender is made. Each tender must be in
multiples of $100, must state the face amount of bonds applied for, and the
price off'ered. The price offered must be expressed on the basis of 100 with
not more than three decimal places, e. g., 100.125.
Tenders will be received without deposit from incorporated banks and trust
companies and from responsible and recognized dealers in investment securities.
Tenders from others must be accompanied in every case by a deposit of 5
percent of the face amount of bonds bid for, except where the tender is accompanied by an express guaranty of payment by an incorporated bank or trust
company. If the tender is accepted, in whole or in part, the deposit will be
applied toward payment for the bonds, the balance to be paid as hereinafter
provided. If the tender is rejected, the deposit will be returned to the bidder.
Tenders must be enclosed in envelops,' securely sealed, addressed to a Federal
Reserve bank, or branch, and plainly inarked " Tender for bonds of the Home
Owners' Loan Corporation." The Federal Reserve banks will supply printed
forms and special envelops for submitting tenders.
Immediately after the closing hour for the receipt of tenders on August 8,
1984, all tenders received at the Federal Reserve banks or branches thereof up
to the closing hour will be opened. The Secretary of the Treasury will determine the acceptable prices offered and will make public announcement thereof
as soon as possible after the opening of tenders. Those submitting tenders
will be advised by the Federal Reserve banks of the acceptance or rejection
thereof, and payment on accepted tenders must be made as hereinafter provided. In considering the acceptance of tenders, the highest prices offered will
be accepted in full down to the amount required, and if the same price appears
in two or more tenders and it is necessary to accept only a part of the amount
offered at such price, the amount accepted at such price will be prorated in
accordance with the respective amounts bid for. However, the Secretary of
the Treasury expressly reserves the right to reject any or all tenders or parts
of tenders, and to award less than the amount bid for, and any action he may
take in any such respect or respects shall be final.
PAYMENT

Paj^ment for any bonds allotted on accepted tenders must be made or completed on or before August 15, 1934, in cash or other immediately available
funds. In every case where payment is not so completed, the 5 percent payment with application shall, upon declaration by the Secretary of the Treasury
in his discretion, be forfeited to the Home Owners' Loan Corporation.
G E N E R A L PROVISIONS

Federal Reserve banks, as fiscal agents of the United States, are authorized
and requested to receive tenders, to make allotments as directed by the Secre-

236

REPORT OF THE SECRETARY OF T H E TREASURY

tary of the Treasury, to issue allotment notices, to receive payment for bonds
allotted, to make delivery of bonds on full-paid allotments, and to perform
such other acts as may be necessary to carry out the provisions of this circular.
Pending delivery of the definitive bonds. Federal Reserve banks may issue
interim receipts.
The Secretary of the Treasury may at any time, or from time to time,
prescribe supplemental or amendatory rules and regulations governing the
receipt of tenders and the sale of bonds under this circular, which will be
promptly communicated to the Federal Reserve banks.
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
Exhibit 28
Acceptance of tender,s for Home Owners' Loan Corporation bonds, series (7,
1936, series D, 1937, and series E, 1938 (from press release, Aug. 9, 1934,
revised ^)
On August 9, 1934, Secretary of the Treasury Morgenthau announced the
result of the offering by the Treasury of not to exceed $150,000,000 of bonds
of the Home Owners' Loan Corporation in three series of not more than
$50,000,000 each, tenders for which were received at the Federal Reserve banks
up to 2 p. m,, August 8,
Tenders aggregating $238,126,600 were received for the three series, of which
tenders amounting to $127,111,100 were accepted. In accordance with the right
reserved to reject any tenders,, all those below 99 for the 3- and 4-year bonds
were rejected as being unsatisfactory in price, with the result that allotments
for these two series were below the amounts offered. In addition to accepted
bids the Treasury purchased for the benefit of its investment funds $8,000,000
of the 3-year and $14,000,000 of the 4-year bonds.
The details of each series follow:
Bids accepted

Issue

Average

Total amount!
applied for
Amount

Highest

Lowest
Price

Series C, 1936.
Series D, 1937
Series E, 1938

$124, 462, 500 $49, 736, 000 101.590
48, 177, 000 41, 843, 000 101.130
60, 487, 100 35, 532, 100 101.035

100.411
99.000
99,000

100.677
99.931
99.962

Equivalent
ratei
LIS
L77
2.01

1 Bank discount basis.

Exhibit 29
Offering of Home Owners' Loan Corporation ly^ percent bonds of series F~1939
(loith circular of Home Owners' Loan Corporation governing redemption^ of
its 4 percent bonds of 1938-51)
On May 20, 1935, Secretary of the Treasury Morgenthau, on behalf of the
Home OAvners' Loan Corporation, offered 1% percent bonds of the Corporation
in payment of which only 4 percent bonds of the Corporation, series of 1933-51,
called for redemption on July 1, 1935", might be tendered.
I Eevised Aug. 15 and 21, 1934.

EEPOET OP THE SECRETARY OF THE TEEASURY

237

[Department Circular No, 540]
TREASURY

DEPARTMENT,

Washington, May 20, 1935.
The Secretary of the Treasury, on behalf of the Home Owners' Loan Corporation, invites subscriptions, from the people of the United States, for 1^/^ percent bonds of the Home Owners' Loan Corporation, designated bonds of series
F-1939, in payment of which only Home Owners' Loan Corporation 4 percent
bonds of series of 1933-51, called for redemption on July 1, 1935, of an equal
principal amount, may be tendered. The amount of the offering under this
circular will be limited to the principal amount of Home Owners' Loan Corporation 4 percent bonds of series of 1933-51 tendered and accepted. It is the
intention to offer for cash subscription, upon such terms and conditions as
may be prescribed by the Home Owners' Loan Corporation with the approval
of the Secretary of the Treasury, an additional amount of bonds of series
F-1939, approximately equal to the amount of Home Owners' Loan Corporation 4 percent bonds o-f series of 1933-51 not tendered and accepted hereunder.
The terms and conditions of the bonds offered under this circular, the manner in which such bonds shall be issued, and the prices at which they shall
be sold are prescribed by the Home Owners' Loan Corporation, with the approval of the Secretary of the Treasury, as follows:
DESCRIPTION

OF BONDS

The bonds will be dated June 1, 1935, and will bear interest from that date
at the rate of 1% percent per annum, payable semiannually, on December 1,
1935, and thereafter on June 1 and December 1 in each year. They will
mature June 1, 1939, and will not be subject to call for redemption prior to
maturity.
These bonds are issued under the authority of the Home Owners' Loan
Act of 1933, as amended, which provides that these bonds shall be exempt,
both as to principal and interest, from all taxation (except surtaxes, estate,
inheritance, and gift taxes) now or hereafter imposed by the United States
or any District, Territory, dependency, or possession thereof, or by any State;
county, municipality, or local taxing authority.
The bonds will be acceptable at face value in payment of indebtedness due
the Home Owners' Loan Corporation. They will be acceptable to secure
deposits of public moneys, and will also be acceptable in lieu of surety under
the provisions of section 1126 of the Revenue Act of 1926, as amended. They
will be acceptable to secure 15-day borrowings from the Federal Reserve banks.
The bonds herein offered come within the following provisions of section 4 ( c )
of the Plome Owners' Loan Act of 1933, as amended: " * * * Such bonds
shall be fully and unconditionally guaranteed both as to interest and principal
by the United States, and such guaranty shall be expressed on the face thereof,
and such bonds shall be lawful investments, and may be accepted as security,
for all fiduciary, trust, and public funds, the investment • or deposit of which
shall be under the authority or control of the United States or any officer or
officers thereof. In the event that the Corporation shall be unable to pay
upon demand, when due, the principal of, or interest on, such bonds, the
Secretary of the Treasury shall pay to the holder the amount thereof which
is hereby authorized to be appropriated out of any moneys in the Treasury
not otherwise aippropriated, and thereupon to the extent of the amount so paid
the Secretary of the Treasury shall succeed to all the rights of the holders of
such bonds. * * *"
Bearer bonds with interest coupons attached will be issued in denominations
of $25, $50, $100, $500, $1,000, $5,000, $10,000, $100,000. The bonds will not be
issued in registered form. Provision will be made for the interchange of bonds
of different denominations, without charge by the Corporation, under rules
and regulations prescribed by the Corporation.
SUBSCRIPTION AND ALLOTMENT

Subscriptions will be received at the Federal .Reserve banks and branches
and the Treasury Department, Washington, D. C. The Secretary of the
Treasury reserves the right to close the books as to any or all subscriptions
at any time without notice.

238

REPORT OP THE SECRETARY OP THE TREASURY

The Secretary of the Treasury reserves the right to reject any subscription,
in whole or in part, to allot less than the amount of bonds applied for, to
make allotments in full upon applications for smaller amounts and to make
reduced allotments upon, or to reject,, applications for larger amounts, to make
classified allotments or to make aliotments upon a graduated scale, or to
adopt any or all of said methods or such other methods of allotment and classification of allotments as shall be deemed by him to be in the public interest;
and his action in any or all of these respects shall be final. Subject to these
reservations, all subscriptions will be allotted in fuU. Allotment notices will
be sent out promptly upon allotment.
T E R M S OF

PAYMENT

Payment for bonds allotted hereunder may be made only in Home Owners'
Loan Corporation 4 percent bonds of series of 1933-51, called for redemption
on July 1, 1935, of an equal principal amount, which should accompany the subscription. Cash payments will not be accepted. If any subscription is rejected,
in whole or in part, the Home Owners' Loan Corporation 4 percent bonds of
series of 1933-51 tendered therewith and not accepted will be returned to the
subscriber. Interest on Ho-me Owners' Loan Corporation 4 percent bonds of
series of 1933-51 tendered and accepted will be paid in full to July 1, 1935.
SURRENDER OF H O M E O W N E R S ' LOAN CORPORATION
1933-51

4 PERCENT BONDS OF SERIES

Coupon bonds.—Home Owners' Loan Coi-poration 4 percent bonds of series
of 1933-51 in coupon form tendered in payment for Home Owners' Loan Corporation bonds offered hereunder, should be presented and surrendered with
the subscription to a Federal Reserve bank or the Treasurer of the United
States, Washington, D. C. Coupons dated January 1, 1936, and all coupons
bearing subsequent dates should be attached to such coupon bonds when surrendered, and if any such coupons are missing, the subscription must be
accompanied by cash payment equal to the face amount of the missing coupons.
Coupons dated July 1, 1985, should be detached and collected in regular course
when due. The bonds must be delivered at the expense and risk of the holder.
Facilities for transportation of bonds by registered mail insured may be
arranged between incorporated banks and trust companies and the Federal
Reserve banks, and holders may take advantage of such arrangements when
available, utilizing such incorporated banks and trust companies as their
agents.
Registered bonds.—Home Owners' Loan Corporation 4 percent bonds of series
of 1933-51 in registered form tendered in payment for Home Owners' Loan
Corporation li/^ percent bonds offered hereunder, should be assigned by the
registered payee or the assignee thereof to " Home Owners' Loan Corporation
in payment for Home Owners' Loan Corporation 1% percent bonds of series
P-1939", and thereafter should be presented and surrendered with the subscription to a Federal Reserve bank or to the Treasury Department, Division
of Loans and Currency, Washington, D. C. If the l i ^ percent bonds are to be
delivered for the account of other than the registered payee or the assignee
of the 4 percent bonds surrendered, the assignment should be to " Home Owners'
Loan Corporation in payment for Home Owners' Loan Corporation l i ^ percent
bonds of series F-1939 to be delivered to
" The bonds must,
be delivered at the expense and risk of the holder. Final interest due will
be paid oh July 1, 1935, by checks issued in favor of registered payees and
for this purpose the persons entitled by assignment to receive the bonds of
series F-1939 will be considered the registered payees.
GENERAL

PROVISIONS

Federal Reserve banks, as fiscal agents of the United States, are authorized
and requested to receive subscriptions, to make allotments as directed by the
Secretary of the Treasury, to issue allotment notices, to receive payment for
bonds allotted, to make delivery of bonds on full-paid subscriptions allotted, to
issue interim receipts if required, and to perform such other acts as may be
necessary to carry out the provisions of this circular.

REPORT OF THE SECRETARY OF THE TEEASURY

239

The Secretary of the Treasury may at any time, or from time to time, prescribe supplemental or amendatory rules and regulations governing the offering which will be promptly communicated to the Federal Reserve banks.
HENRY MORGENTHAU, Jr.,

Secretary of the Treasury.
The circular of the Home Owners' Loan Corporation governing the redemption
of its 4 percent bonds, series of 1933-51, as follows :
- '
[Horrie Owners' Loan Corporation Circular No. 11]
HOME OWNERS' LOAN CORPORATION,
OFFICE OF THE CHAIRMAN,

Washington, May 20, 1935.
To Holders of Home Owners' Loan Corporation 4 Percent Bonds of Series of
1933-51, and Others Concerned:
I. N O T I C E

O F CALL

FOR REDEMPTION

BEFORE

MATURITY

On May 20,1935, the following public notice of call for redemption was given:
Public notice is hereby given that all outstanding Home Owners' Loan Corporation 4 percent bonds of series of 1933-51, dated July 1, 1938, each and
every number of all denominations, are hereby called for redemption on July
1, 1935, and will cease to bear interest on that date.
Full information regarding the presentation and surrender of such Home
Owners' Loan Corporation 4 percent bonds of series of 1933-51 for redemption
on July 1, 1935, is given in Circular No. 11, dated May 20, 1935, of the Home
Owners' Loan Corporation.
I

I I . OPTIONAL EXCHANGE OFFERING

Holders of Home Owners' Loan Corporation 4 percent bonds of series of
1933-51, now called for redemption on July 1, 1935, are offered the privilege,
for a limited period^ of acquiring with all or any part of their called bonds •
an equal principal amount of 4-year 1% percent bonds of the Home Owners'
Loan Corporation, dated and bearing interest from June 1, 1935, and fully
and unconditionally guaranteed both as to interest and principal by the United
States. Full inforrnation concerning the offering is set forth in Treasury
Department Circular No. 540, dated May 20, 1935.
I I I . RUlLES AND REGULATIONS GOVERNING REDEMPTION OF HOME OWNERS' LOAN CORPORATION 4 PERCENT BONDS

Pursuant to the call for redemption, as set forth in section 1 of this circular,
the following rules and regulations are hereby prescribed to govern the presentation and surrender of Home Owners' Loan Corporation 4 percent bonds for
redemption on July 1, 1935:
1. The United States Treasury Department is the agency of the Home
Owners' Loan Corporation for the redemption of Home Owners' Loan Corporation 4 percent bonds, and the Home Owners' Loan Corporation has adopted
the regulations of the Treasury Department governing the assignment and
redemption of United States bonds in connection with the redemption of Home
Owners' Loan Corporation bonds. Therefore, Treasury Department regulations
will be followed in connection with the assignment and redemption of Home
Owners' Loan Corporation 4 percent bonds, except as otherwise provided
herein.
2. Payment of called bonds on July 1, 1935.—Holders of any outstanding
Home Owners' Loan Corporation 4 percent bonds will be entitled to have such
bonds redeemed and paid at par on July 1, 1935, with interest in full to that
date. After July 1, 1935, interest will not accrue on any Home Owners' Loan
Corporation 4 percent bonds.
3. Presentation and surrender of coupon bonds.—Home Owners' Loan Corporation 4 percent bonds in coupon form should be presented and surrendered
to any Federal Reserve bank or branch, or to the Treasurer of the United
States, Washington, D. C, for redemption on July 1, 1935. The bonds must be
delivered at the expense and risk of holders (see par. 9 of this section), 'and
should be accompanied by appropriate written advice (see form FA12 attached
16816—36

240

REPORT OF THE SECRETARY OP THE TBEASURY

hereto). Checks in payment of principal will be mailed to the address given
in the form of advice accompanying the bonds surrendered.
4. Coupons dated July 1, 1985, which become payable on that date, should be
detached from any Plome Owners' Loan Corporation 4 percent bonds before
such bonds are presented for redemption on July 1, 1985, and such coupons
should be collected in regular course when due. All coupons pertaining to such
bonds bearing dates subsequent to July 1, 1985, must be attached to any such
bonds, when presented for redemption, provided, however, if any such coupons
are missing from bonds so presented for redemption the bonds nevertheless
will be redeemed, but the full face amo'unt of any such missing coupons will
be deducted from the payment to be made on account of such redemption, and
any amounts so deducted will be held in the Treasury to provide for adjustments or refunds on account of such missing coupons as may subsequently
be presented.
5. Presentation and surrender of registered bonds.—Home Owners' Loan
Corporation 4 percent bonds in registered form must be assigned by the registered payees or assigns thereof, or by their duly constituted representatives, in
accordance with the general regulations of the United States Treasury Department governing assignments of United States bonds in the form indicated in the
next paragraph hereof, and thereafter should be presented and surrendered to
any Federal Reserve bank or branch, or to the Division of Loans and Currency,
Treasury Department, Washington, D. C, for redemption on July 1, 1985. The
bonds must be delivered at the expense and risk of holders (see par. 9 of this
section) and should be accompanied by appropriate written advice (see form
FA13 attached hereto). Final interest due July 1, 1935, on registered bonds
will be paid with the principal amount thereof and check will be issued in
regular course to the owner of the bond surrendered.
6. If the registered payee, or an assignee holding under proper assignment
from the registered payee, desires that payment of the principal and final instalment of interest be made to him, the bonds should be assigned by such payee
or assignee, or by a duly constituted representative, to the " Home Owners'
Loan Corporation for redemption." If it is desired, for any reason, that payment be made to some other person, without intermediate assignment the bonds
should be assigned to the " Home Owners' Loan Corporation for redemption for
the account of
", inserting the name and address of the person to whom payment is to be made. A representative or fiduciary should not
assign for payment to himself individually, unless expressly authorized to do so
by court order or the instrument under which he is acting; he may, however,
assign for payment to himself in his representative or fiduciary capacity.
7. Assignment in blank or other assignment having similar effect, will be
recognized, but in that event payment will be made to the person surrendering
the bond for redemption, since under such assignment the bond becomes in
effect payable to bearer. Assignments in blank or assignments having similar
effect should be avoided, if possible, in order not to lose the protection afforded
by registration.
8. Final interest due on July 1, 1935, on registered Home Owners' Loan Corporation 4 percent bonds will be paid with the principal in accordance with the
assignments on the bonds surrendered. The transfer books for registered
bonds will remain open until June 15, 1935.
9. Transportation of bonds.—Bonds presented for redemption under this circular must be delivered to a Federal Reserve bank or branch, or to the Treasury
Department, Washington, D. C, at the expense and rislv of the holder. Coupon
bonds should be forwarded by registered mail insured, or by express prepaid.
Registered bonds bearing restricted assignments may be forwarded by registered
mail, but registered bonds bearing unrestricted assignments should be forwarded by registered mail insured or by express. Facilities for transportation
of bonds by registered, mail insured may be arranged between incorporated
banks and trust companies and the Federal Reserve banks, and holders may
take advantage of such arrangements when available, utilizing such incorporated banks and trust companies as their agents. Incorporated banks and
trust companies are not agents of the Home Owners' Loan Corporation under
this circular.
IV. T I M E OF PRESENTATION OF CALLED BONDS FOR REDEMPTION

1. In order to facilitate the redemption of Home Owners' Loan Corporation
4 percent bonds on July 1, 1935, any such bonds should be presented and sur^rendered in the manner herein prescribed well in advance of. that date but not

241

REPORT'OP T H B SECRETARY OP T H E TREASTJRY

before J u n e 1, 1935. Such early presentation by holders will assure prompt
payment of principal when due. This is particularly important with respect
to registered bonds, for payment cannot be made until registration shall have
been discharged a t the United States T r e a s u r y Department.
2. I t will expedite redemption if t h e bonds a r e presented to Federal Reserve
banks, or branches, and not direct to t h e T r e a s u r y Department.
3. As hereinbefore provided : (1) Coupons due July 1, 1935, should be detached
from any coupon bonds when such bonds a r e presented for redemption on
t h a t date, such coupons to be collected when d u e ; and (2) final interest due
on any registered borids will be paid with the principal amount.
4. If Home Owners' Loan Corporation 4 percent bonds called for redemption
on J u l y 1, 1935, a r e t o be presented in p a y m e n t for Home Owners' Loan Corporation 11/^ percent bonds of series P-1989, instructions given in Treasiiry Dep a r t m e n t Circular No. 540 should be followed; if t o be presented for redemption on July 1, 1935, instructions given in this circular should be followed.
V. GENERAL PROVISIONS

1. Any further information which may be desired regarding the redemption
of Home Owners' Loan Corporation 4 percent bonds u n d e r this circular may
be obtained from any Federal Reserve bank or branch, or from t h e T r e a s u r y
Department, Washington, D. C , where copies of the T r e a s u r y Department's
regulations governing assignments also may be obtained.
2. As fiscal agents of t h e Home Owners' Loan Corporation, Federal Reserve
banks are aiuthorized and requested to perform any necessary acts under t h i s
circular. T h e chairman of the board of directors of t h e Home Owners' Loan
Corporation may a t any time, or from time to time, prescribe supplemental
or amendatory rules and..regulations governing the m a t t e r s covered by t h i s
circular, which will be cornmunicated promptly to Federal Reserve banks.
J O H N H . FAHBY,

Chairman of the Board of Directors.
F O R COUPON BONDS
[Form FA 12. For registered bonds use form FA 13]
FORM OF ADVICE TO ACCOMPANY H O M E O W N E R S ' LOAN CORPORATION 4 PERCENT
BONDS I N COUPON FORM PRESENTED FOR REDEMPTION ON J U L Y 1, 1935
To the FEDERAL RESERVE B A N K OF

or
TREASURER OF T H E U N I T E D STATES, W A S H I N G T O N , D . C . :

P u r s u a n t to the provisions of Home Owners' Loan Corporation Circular No.
11, dated May 20, 1935, t h e undersigned presents and surrenders herewith for
redemption on July 1, 1935, $
, face amount of Home Owners' Loan
Corporation 4 perceiit bonds in coupon form,'with coupon due J a n u a r y 1, 1986,
and all subsequent coupons attached, a s follows:
Denomination

Number of bonds

$25
50
100
500
1, 000
5, 000
10, 000
100,000

Total -

Serial numbers of bonds

Face
amount

$ - --

a n d requests t h a t remittance covering payment therefor be forwarded to t h e
undersigned a t the address indicated below.
Signature
:
^
:—-.
Name (please p r i n t )
Address in full
Date

242

REPORT OF THE SECRETARY OP THE TREASURY

Date-

FOR REGISTERED BONDS
[Form FA 13,

For coupon bonds use form FA 12]

FORM OF ADVICE TO ACCOMPANY HOME OWNEIRS' LOAN CORPORATION 4 PERCENT
BONDS IN REGISTERED FORM PRESENTED FOB REDEMPTION ON JULY 1, 1935
To the FEDERAL RESERVE BANK OF

or
TREASURY DEPARTMENT, DIVISION OF LOANS AND CURRENCY, WASHINGTON,

D. C :
Pursuant to the provisions of Home Owners' Loan Corporation Circular No,
11, dated May 20, 1935, the undersigned presents and surrenders herewith for
redemption on July 1, 1935, $
;
, face amount of Home Owners' Loan
Corporation 4 .percent bonds in registered form, inscribed in the name of
and duly assigned to the " Home Owners' Loan Corporation for redemption ", as follows:
Number of bonds

Denomination

Serial numbers of bonds

Face
amount

$1,000
5,000
10, 000
100,000
Total

and requests that remittance covering payment of principal and final interest
be forwarded to the undersigned at the address indicated below.
Signature
Name (please print)
Address in full
Date
Exhibit 30
Allotments on exchange subscriptions, Home Owners' Loan Corporation bonds of
series F-1939 (press release, June 3, 1935^)
The subscription books for the offering of 1% percent bonds of the Home
Owners' Loan Corporation of series F-1939 were closed on May 29, 1935. The
subscriptions, which were limited to holders of corporation bonds, series of
1933-51, were divided among the several Federal Reserve districts and the
Treasury as follows:
Federal Reserve district

Boston
New York--.
Philadelphia.
Cleveland--.
Richmond.-.
Atlanta
Chicago—^—.
St. Louis
1 Eevised Aug. 6, 1935.

Total subscriptions and
allotments
$6,323. 725
152,428,975
9,854, 650
9,199, 060
5,825, 626
6,994,800
18,347, 525
7,874,260

Federal Eeserve district

Total subscriptions and
allotments

Minneapolis..
Kansas City—
Dallas
San Francisco.
Treasury

$10,641,275
4,476,625
499,075
6, 716,850
6,073,325

Total-

245, 254, 750

REPORT OP THE SECRETARY OF THE TEEASURY

243

Miscellaneous
Exhibit 31
An act to amend tive Second Liberty Bond Act, as amended, and for other
purposes
[Public No. 3, 74th Cong., H. R. 4304]

Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled, That the Second Liberty Bond Act,
as amended, is further amended as follows:
The first paragraph of section 1 is amended to read as follows:
" The Secretary of the Treasury, with the approval of the President, is
hereby authorized to borrow, from time to time, on the credit of the United
States for the purposes of this act, to provide for the purchase, redemption,
or refunding, at or before maturity, of any outstanding bonds, notes, certificates
of indebtedness, or Treasury bills of the United States, and to meet expenditures authorized for the national security and defense and other public purposes authorized by law, such sum or sums as in his judgment may be necessary, and to issue therefor bonds of the United States: Provided, That the
face amount of bonds issued under this section and section 22 of this act shall
not exceed in the aggregate $25,000,000,000 outstanding at any one time."
SEC 2. The first sentence of subsection (a) of section 5 is amended to read
as follows: " I n addition to the bonds and notes authorized by sections 1, 18,
and 22 of this act, as amended, the Secretary of the Treasury is authorized,
subject to. the limitation imposed hj section 21 of this act, to borrow from
time to time, on the credit of the United States, for the purposes of this act,
to provide for the purchase, redemption, or refunding, at or before maturity,
of any outstanding bonds, notes, certificates of indebtedness or Treasury bills
of tlie United States, and to meet public expenditures authorized by law,
such sum or sums as in his judgment may be necessary, and to issue therefor
(1) certificates of indebtedness of the United States at not less than par
(except as provided in section 20 of this act, as amended) and at such rate or
rates of interest, paj^able at such time or times as he may prescribe; or, (2)
Treasury bills on a discount basis and payable at maturity without interest."
SEC 3. Section 5 is further amended by striking out the final sentence' of subsection (a) thereof, reading as follows: "The sum of the par value of such
certificates and Treasury bills outstanding hereunder and under section 6
of the First Liberty Bond Act shall not at any one time exceed in the aggregate $10,000,000,000."
SEC 4. Subsection (a) of section 18 is amended to read as follows:
" In addition to the bonds and certificates of indebtedness and war-savings
certificates authorized by this act and amendments thereto, the Secretary of
the Treasury, with the approval of the President, is authorized, subject to the
limitation imposed by section 21 of this act, to borrow from time to time
on the credit of the United States for the purposes of this act, to provide
for the purchase, redemption, or refunding, at or before maturity, of any outr
standing bonds, notes, certificates of indebtedness, or Treasury bills of the
United States, and to meet public expenditures authorized by law, such sum or
sums as in his judgment may be necessary and to issue therefor notes of the
United States at not less than par (except as provided in sec, 20 of this
act, as amended) in such form or forms and denomination or denominations,
containing such terms and conditions, and at such rate or rates of interest,
as the Secretary of the Treasury may prescribe, and each series of notes so
issued shall be payable at such time not less than 1 year nor more than 5 years
from the date of its issue as he may prescribe, and may be redeemable
before maturity (at the option of the United States) in whole or in part, upon
not more than 1 year's nor less than 4 months' notice, and under such
rules and regulations and during such period as he may prescribe."
SEO. 5. The Second Liberty Bond Act, as amended, is further amended, by
adding a new section, as follows:
" SEC 21. The face amount of certificates of indebtedness and Treasury bills
authorized by section 5 of this act, certificates of indebtedness authorized by
section 6 of the First Liberty Bond Act, and notes authorized by section 18

244

REPORT OF THE SECEETAEY OF THE TEEASURY

of this act shall not exceed in the aggregate $20,000,000,000 outstanding at an^
one time."
SEC 6. The Second Liberty Bond Act, as amended, is further amended, by
adding a new section, as follows:
" SEC. 22. (a) The Secretary of the Treasury, with the approval of the President, is authorized to issue, from time to time, through the postal service or
otherwise, bonds of the United States to be known as ' United States Savings
Bonds,' The proceeds of the Savings Bonds shall be available to meet any public
expenditures authorized by law and to retire any outstanding obligations of
the United States bearing interest or issued on a discount basis. The various
issues and series of the Savings Bonds shall be in such forms, shall be offered
in such amounts within the limits of section 1 of this act, as amended, and
shall be issued in such manner and subject to such terms and conditions
consistent with subsections (b) and (c) hereof, and including any restriction
on their transfer, as the Secretary of the Treasury may from time to time
prescribe.
"(b) Bach Savings Bond shall be issued on a discount basis to mature
not less than 10 nor more than 20 years from the date as of which the bond
is issued, and provision may be riiade for redemption before maturity upon
such terms and conditions as the Secretary of the Treasury may prescribe:
Provided, That the issue price of Savings Bonds and the terms upon which they
may be redeemed prior to maturity shall be such as to afford an investment
yield not in excess of 3 per centum per annum, compounded semiannually.
The denominations of Savings Bonds shall be in terms of their maturity value
and shall not be less than $25. It shall not be lawful for any one person at any
one time to hold Savings Bonds issued during any one calendar year in an
aggregate amount exceeding $10,000 (maturity value).
" ( c ) The provisions of section 7 of this act, as amended (relating to the
exemptions from taxation both as to principal and as to interest of bonds
issued under authority of sec. 1 of this act, as amended), shall apply as
well to the Savings Bonds; and, for the purposes of determining taxes and
tax exemptions, the increm.ent in value represented by the difference between
the price paid and the redemption value received (whether at or before maturity) shall be considered as interest. The Savings Bonds shall not bear the
circulation privilege.
" (d) The appropriation for expenses provided by section 10 of this act and
extended by the act of June 16, 1921 (U. S. C, title 31, sees. 760 and 761),
shall be available for all necessary expenses under this section ; and the Secretary of the Treasury is authorized to advance, from time to time, to the Postmaster General from such appropriation such sums as are shown to be required for the expenses of the Post Office Department, in connection with the
handling of the-boiids issued under this.section;
" (e> The board of trustees of the Postal Savings System is authorized to
permit, subject to such regulations as it may from time to time prescribe, the
withdrawal of deposits on less than 60 days' notice for the purpose of acquiring Savings Bonds which may be offered by the Secretary of the Treasury;
and in such cases to make payment of interest to the date of withdrawal
whether or not a regular interest payment date. No further original issue of
bonds authorized by section 10 of the act approved June 25, 1910 (U. S. C, title
39, sec. 760), shall be made after July 1, 1935.
"(f) At the request of the Secretary of the Treasury the Postmaster General, under such regulations as he may prescribe, shall require the employees of
the Post Office Department and of the Postal Service to perform, without extra
compensation, such fiscal agency services as may be desirable and practicable
in connection with. the issue, delivery, safe-keeping, redemption, and payment
of the Savings Bonds."
SEC 7. Section 1126 of the _Revenue Act of 1926 is amended by adding at
the end thereof the following: " In order to avoid the frequent substitution
of securities such rules and regulations may limit the effect of this section, in
appropriate classes of cases, to bonds and notes of the United States maturing
more than a year after the date of deposit of such bonds as security. The
phrase ' bonds or notes of the United States' shall be deemed, for the purposes of this.section to mean any public debt obligations of the United States
and any bonds, notes, or other obligations which are unconditionally guaranteed as to both interest and principal by the United States."
Approved, February 4, 1935.

REPORT OF THE SECRETARY OF THE TREASURY

245

Exhibit 32
Statement for the press, January 21, 1935, giving an explanation of the bill to
amend the Second Liberty Bond Act
Representative Robert L. Doughton, chairman of the Ways and Means Committee, submitted the following explanation of the bill which he introduced
today to amend the Second Liberty Bond Act:
The present authority of the Government to issue bonds is limited to
$2,549,512,885. The Second Liberty Bond Act in its present form carries
authorization for the issuance of $28,000,000,000 of bonds, but since $25,450,487,115 have already been issued, the right to issue new long-term securities
is very much restricted. Of the more than $25,000,000,000 which have been issued, there are now outstanding $13,474,947,650. But the nearly $12,000,000,000
which have been retired may not be reissued without specific authority, since
the authorization in the Second Liberty Bond Act was not in the nature of a
revolving fund.
It is now proposed to substitute a $25,000,000,000 revolving authorization for
the previous $28,000,000,000 fixed authority. " This wiU give to the Treasury
authority to issue between 11 and 12 billions in bonds, which is approximately
equivalent to the amount of those which have been retired out of those issued
under the $28,000,000,000 authorization.
The bill also proposes to consolidate the two existing revolving founds relating
to short-term obligations. At present notes may be issued to the" amount of
$10,000,000,000 outstanding at any one time, and certificates of indebtedness and
Treasury bills may be outstanding in like amount. It is proposed to substitute one $20,000,000,000 limitation applicable to the aggregate outstanding
notes, certificates, and ^ills, thus affording greater fiexibility in financing the
requirements of the Treasury. There were on December 31, $9,586,000,000
of notes outstanding, while certificates and bills aggregated $2,112,000,000.
The amendment proposed in this regard would not increase the total authorization for the issuance of short-term obligations.
The bill would likewise authorize the issuance, at a discount, of United States
Savings Bonds maturing in from 10 to 20 years, with the holder having the
right in the interval to receive payment from the Treasury on an ascending
scale of value. It would also permit the use of Government guaranteed bonds
as security in lieu of surety bonds.
Statement showing present authority to issue bonds, notes, certificates of
indebtedness and Treasury bills under the Second Liberty Bond Act, as
amended, and under proposed aonendments
[December 31, 1934]

Bonds:
Under present authority:
Total issuable
Total issued:
Liberty bonds
Treasury bonds

$28, 000, 000, 000
-—

$14, 948, 096,150
10, 502, 390, 965
25,450,487,115

Balance now issuable

2, 549, 512, 885

Total authorized
$28, 000, 000, 000
Total issued
25, 450, 487,115
Total retired
11, 975, 539, 465
Total outstanding13, 474, 947, 650
Under proposed amendment:
Total which may be outstanding at any one time
25, 000, 000, 000
Now outstanding
Liberty bonds
$3,194, 086, 650
Treasury bonds
lO; 280, 861, 000
13,474,947,650
Balance issuable

11, 525,052, 350

246

REPORT OF THE SECRETARY OF THE TREASURY

Notes, certificates of indebtedness, and Treasury bills:
Under present authority:
Notes:
Total which may be outstanding at any one time— $10, 000', 000', 000
Now outstanding—Treasury notes
9,586,377,400
Balance issuable

413, 622,600

Certificates of indebtedness and Treasury bills:
Total which may be outstanding at any one time
Now outstanding:
Certificates of indebtedness— $158, 300, 000
Treasury bills
1,9'54,168,000

10,000,000,000

2,112,468,000
Balance issuable

7, 887, 532, 000

Under proposed amendments:
Notes, certificates of indebtedness, and Treasury bills:
Total which may be outstanding at any one time
20, 000, 000, 000
Now outstanding:
Notes
$9, 586, 877, 400
Certificates of indebtedness— $158, 300,000
Treasury biUs
1, 954,168,000
11,698,845,400
Balance issuable

8, 301,154, 600

Exhibit 33
Regulations governing United States Savings Bonds
[Department Circular No. 530]
TREASURY DEPARTMENT,

Washington, February 25, 1935.
To Oumers of United States Savings Bonds, and Others Concerned:
The following regulations governing United States Savings Bonds are published for the information and guidance of all concerned:
I. REGISTRATION

1. United States Savings Bonds will pe issued only in registered form. Except
as otherwise specifically provided in these regulations, the Treasury Department
reserves the right to treat as conclusive the ownership and interest in the bond
as stated in the registration.
2. The following forms of registration are authorized:
(a) In the name of any individual, including minors.
(b) In the names of two (but not more than two) natural persons in the alternative, as, for example, " John Jones or Mary Jones." The addresses of both
persons should be inscribed on the Savings Bonds. No other form of registration
in two names is authorized except, as provided in subparagraphs (c) and (d)
hereof.
(c) In the name of one individual and a single designated beneficiary in case
of death, as for example, " John Smith, payable on death to Mary Smith ", in
which case the address of the registered owner and the address of the beneficiary
should be inscribed on the face of the Savings Bond.
(d) In the name of one or more guardians, executors, administrators, trustees,
or other fiduciaries, whose names shall be given, followed by a description as complete as possible of the capacity in which and the persons for whom they hold
the Savings Bonds. Registration in a form indicating that the persons whose
names appear on the bonds do not hold full legal title to the Savings Bonds, as,
for example, " John Jones, under article 10, of the will of Henry Smith ", will
not be permitted.

REPORT OF THE SECRETAEY OF THE TREASURY

247

(e) In the name of any corporation, unincorporated association, partnership, or
joint stock company. The name of the owner should be followed by the word
or words " corporation ", " unincorporated association ", " partnership ", or " joint
stock company", as the case may be. No designation may be made in the
registration of an officer or agent to receive payment in behalf of the corporation, unincorporated association, partnership, or joint stock company.
II. BONDS N O T TRANSFERABLE

United States Savings Bonds are not transferable; and are payable only to
the owner named thereon, except in case of the death or disability of the ownet
or as a result of judicial proceedings, and then only to the extent specificallj'
provided in sections XIII, VIII, and XIV hereof.
ni.

LIMITATION ON HOLDINGS

Under the provisions of section 22 of the Second Liberty Bond Act, approved
September 24, 1917, as amended, it shall not be lawful for any one person at
any one time to hold Savings Bonds issued during any one calendar year in an
aggregate amount exceeding $10,000 (maturity value). In determining whether
the $10,000 limitation on the holdings of any one person has been exceeded, the
full maturity value of Savings Bonds issued in any one calendar year held for
the benefit of such person in the name of a fiduciary or fiduciaries, or held by
such person with any other person (but not of bpnds of which such person
is merely the designated beneficiary in case of the death of the owner), shall
be added to the full maturity value of such bonds held by such person in his
or her own name, and the sum must not exceed $10,000 (maturity value). If
any person who owns Savings Bonds should become the owner of additional
Savings Bonds as the result of the death of any other person, and the total
amount then owned by him is in excess of the lawful limit, he should immediately surrender the excess for payment at the redemption value for the period
in which the excess was acquired.
IV. LOST, STOLEN, OR DESTROYED BONDS

1. Under the provisions of the Revised Statutes, duplicates may be issued or
payment made upon proof of the loss, theft, or destruction of Savings Bonds.
Application for relief in such cases will be governed by the regulations found
in Department Circular No. 300. Full information as to the requirements, as
well as appropriate forms,.may be secured from the Treasury Department, Division of Loans and Currency, Washington, D. C.
2. It is important that immediate notice of such loss, theft, or destruction be
given to the Treasury Department.
V. SAFE-KEEPING FAOILITIBS

1. Any Savings Bond will be held in safe-keeping by the Secretary of the
Treasury if the purchaser so desires, and in this connection the Secretary will
utilize the facilities Of the Federal Reserve banks as fiscal agents of the United
States. The purchaser may arrange for such safe-keeping at the time he purchases his bond or subsequently. If the owner desires his bond held in safekeeping, he can obtain from the postmaster an appropriate envelop, and an
application blank which he should fill out, address to the appropriate Federal
Reserve bank, sign and enclose with the bond in the envelop, which should be
addressed to the appropriate Federal Reserve bank. The postmaster will then
register the envelop, at the owner's expense, and the registry receipt will
serve as the owner's temporary receipt.
2. When received at the Federal Reserve bank, the bond will be placed in
safe-keeping and a receipt from the bank will be mailed to the owner at the
address given in the application. The owner can subsequently regain possession of his bonds upon application to the Federal Reserve bank, and upon
such identification as is required by such bank.
3. Postmasters generally will assist owners in arranging for safe-keeping,
but will not act as a safe-keeping agent.

248

REPORT OP THE SECRETARY OF THE TEEASURY
VI. GENERAL P A Y M E N T P R O V I S I O N S

1. Savings Bonds will be payable at or after maturity at their full value, or a t
the option of the owner, prior to maturity (but not within 60 days after theissue date) at the appropriate redemption value as shown on the face of each^
bond. Payment, in each case, will be made following presentation and surrender of the bond, at the Treasury Department, Division of Loans and Currency, Washington, D. C, or at any Federal Reserve bank, with the request
for payment appearing on the back thereof properly executed in accordance
with the succeeding paragraphs. Such presentation will be at the expense
and risk of the owner and, for his protection, the bond, or bonds, should bepresented in person or forwarded by registered mail.
2. The request for payment must be signed in ink or indelible pencil by the
person in whose name the bond is inscribed, or by the person entitled to receive
payment under the provisions hereof. The request must be signed in the
presence of, and be certified by, one of the following officers:
(a) Any United States postmaster, acting postmaster, or official in charge
of a post office authorized to sell Savings Bonds: Provided that in post offices^
of first class the assistant postmaster, the postal cashier, the superintendent of
money orders, or the superintendent or clerk in charge of a classified station
or branch may certify to the request for payment; and provided further that
at any post office of the second class, the assistant postmaster, or the clerk
in charge if there is no assistant postmaster, may certify to the request for
payment. If an official other than a postmaster, acting postmaster, or an
official in charge of an office certifies to a request for payment, he should
certify in the name of the postmaster, acting postmaster, or official in charge,
followed by his own signature and official title, e. g., "John Doe, postmaster,
by Richard Roe, Superintendent of Money Orders." The certification of any
post-office official must be authenticated by a legible imprint of the dating stamp
of his post office;
(b) Any executive officer of an incorporated bank or trust company, whose
signature must be authenticated by the impression of the corporate seal of the
bank or trust company;
(c) Any officer authorized generally to witness assignments of United States
registered bonds (see pars. 33-35 Department Circular 300).
3. No person authorized to certify requests for payment may certify a request signed by himself, either in his own right or in any representative.
capacity.
4. Certifying officers should require positive identification of the person executing the request for payment as the person whose name appears on the face of
the bond, or the person entitled to request payment under the provisions of
these regulations, and will be held fully responsible therefor.
VII.

MINORS

1. If a Savings Bond is registered in the name of a minor and the Treasury
Department has notice that a guardian of the estate of such minor has been
appointed by a court of competent jurisdiction, payment will be made only to
such guardian. The request for payment appearing on the back of the bond
should be signed: "A. B., minor, by C. D., guardian" and must be supported
by a certificate from the proper court, or by a certified copy of the Order
appointing the guardian, showing his appointment and qualification. The certificate, or certified copy, must be under the seal of the court and should be
dated not more than 1 year prior to the presentation of the bond.
2. If the Treasury Department has no notice of the appointment of a
guardian of the estate of a minor owner of a Savings Bond, payment will ,be
made direct to such minor owner, provided such minor is, at the time payment
is requested, of sufficient competency and understanding to sign his name to the
request and to comprehend the nature thereof. In general, the fact that the
request for payment has been signed by the minor and duly certified in accordance with section VI hereof will be accepted as sufficient proof of such competency and understanding. If the Treasury is properly advised in the request
for payment that such minor owner is not of sufficient competency and understanding to execute the request for payment, payment will be made to either
parent of the minor with whom he resides, or in the event that such minor
resides with neither parent, then to the person with whom he does reside. In

REPORT OP THE SECRETARY OP THE TEEASUEY

249

executing the request for payment the parent or other person shall sign the
minor's name as well as his own name, and state his relationship to the minor,
and there shall be inserted above the space for signature in the requiest for
payment a statement to the eft'ect that the owner is a minor, that he is not of
sufficient competency and understanding to execute the request for payment,
and that the person signing the request is the person with whom the minor
resides. An appropriate form is as follows:
" I am the
(state relationship) of A. B. and the person with whom he
resides. He is not of sufficient competency and understanding to sign this
request.
C. D
On behalf of A. B.
I

V I I I . DISABILITY OF O W N E R S

1. If tlie owner of a Savings Bond has been legally declared to be incompetent
to manage his affairs and the Treasury Department has noticed that a conservator
or other legally constituted representative of his estate has been appointed by a
court of competent jurisdiction, payment will be made only to such conservator or
other legal representative. The request for payment should be signed: "A. B.
incompetent, by C. D.^ conservator (guardian or committee as the case may be),
and must be supported by a certificate from the proper court or a certified copy
of the order of the court appointing such conservator or other legal representative
showing his appointment and qualification. The certificate, or certified copy>
should be under the seal of the court and dated not more than 1 year prior to
the date of the presentation of the Savings Bond for payment.
2. In cases where the owner of a Savings Bond has been judicially declared
incompetent or insane and no guardian or other legal representative of his
estate has been appointed, and the entire gross value of his personal estate, both
real and personal, does not exceed $500, payment will be made to a member of
his family standing in the position of voluntary guardian upon presentation of
proof satisfactory to the Secretary of the Treasury that the proceeds of the bonds
are required, and are to be used, for the purchase of necessaries for the incompetent or for his wife or minor children or other persons dependent upon him for
support.
IX.

CO-OWNERS

A Savings Bond registered in the names of two persons in the alternative, as
for example, " John Jones or Mary Jones ", will be payable to either person named
thereon without requiring the signature of the other person, but not to the
representative of a deceased co-owner except as hereinafter provided, and upon
payment to either person the other shall cease to have any interest in the bond.
Should one of the owners die and then the survivor him,self die before payment
of the Savings Bond, the provisions of section XIII hereof, governing payHient
or reissue of Savings: Bonds held by a deceased owner, shall govern the payment
or reissue of the bond as though the survivor had been the sole owner.
X. B E N E F I C I A R I E S

1. A Savings Bond registered in the form "A. B. payable on death to C. D."
will be payable, until the Treasury Department has received notice of the death
of the registered owner, as if the beneficiary were not named on the bond. Upon
proof of death of the registered ovmer, the bond will be payable to, or reissued in
the name of, the beneficiary named on the bond, at his option (but only if such
beneficiary did not predecease the original owner), as if he had been the
registered owner.
2. If the beneficiary should predecease the registered owner, the Savings Bond
will be payable to the registered owner as though such beneficial registration had
not been made. Registration naming beneficiaries at the death of the registered
owner cannot be changed so as to add, eliminate, or substitute beneficiaries.
3. Should the beneficiary die after the death of the registered owner, but before
payment or issue of the Savings Bond, the provisions of section XIII hereof
governing payment or reissue of Savings Bonds held by a deceased owner, shall
govern the payment or reissue of the Savings Bond as though the beneficiary had
been the registered owner.

250

REPORT OF THE SECRETAEY OP THE TREASURY
XI. FIDUCIARIES

1. A Savings Bond registered in the name of a fiduciary will be paid to such
fiduciary without proof of his authority upon presentation of the bond with the
request for payment duly signed by him and certified in accordance with section
VI hereof. The request for payment should be signed by the fiduciary in
exactly the same manner as his name and designation as fiduciary appear on the
face of the Savings Bond.
. 2. In the event of the death or disqualification of a fiduciary in whose name a
Savings Bond is registered, such Savings Bond will be paid to, or, if desired,
reissued in the name of, his successor upon satisfactory proof of the appointment and qualification of such successor. If there is no successor, the Savings
Bond may be paid to, or, if desired, reissued in the name of the person or persons
beneficially entitled thereto upon satisfactory proof of their beneficial ownership.
X I I . CORPORATIONS, A S S O C I A T I O N S , P A R T N E R S H I P S , E T C

1, A Savings Bond registered in the name of a corporation, unincorporated
association, or joint stock company will be paid upon a request for payment
signed by a duly authorized officer of such organization. The signature to the
request should be in the form, " The
Company, by John Jones, President."
The fact that the request for payment is signed and duly certified in accordance
with section V hereof may be accepted as sufficient proof of the officer's
authority.
2, A Savings Bond registered in the name of a partnership will be paid upon
a request for payment signed by any general partner. The signature to the
request should be in the form, " Smith and Jones, a partnership, by John Jones,
a general partner," The fact that the request for payment is signed and duly
certified in accordance with section VI hereof may be accepted as sufficient proof
that the person signing the request is a general partner.
X I I I . DECEASED OWNERS

1. With administration.—If the owner of a Savings Bond dies leaving a will
which is duly admitted to probate and on which letters testamentary are issued,
or dies intestate and the estate is administered in a court of competent jurisdiction, payment will be made to the duly appointed representative of the estate.
The request for payment should be signed in the form, "A. B., executor (administrator) of the estate of C. D., deceased", and must be supported by a certificate under the seal of the court appointing such representative, dated not
more than 6 months prior to the presentation of the Savings Bond for paymerit, showing the appointment and qualification of such representative and
stating that the appointment is still in force; or, in the absence of such a
certificate, by a duly certified copy of the representative's letter of appointment,
the certification of which must be dated not more than 6 months prior to the
presenta.tion of the bond for payment, and must state that the appointment is
still in force. A Savings Bond will be reissued in the name of an heir or legatee
of the deceased owner upon the request of the representative accompanied by his
certificate to the effect that the person in whose name reissue is requested is
entitled to the Savings Bond as such legatee or heir. If the representative is
himself the heir or legatee entitled to the Savings Bond and desires reissue in his
own name, a special order of the court authorizing such reissue must be
Submitted.
2. Without administration.—If the owner of a Savings Bond dies and no legal
representative of his estate is to be appointed and it is established to the satisfaction of the Secretary of the Treasury, either that the gross value of the
personal estate does not exceed $500, or that administration of the estate is not
required in the State of the decedent's domicile, the Savings Bond will be paid
to, or reissued in the name of, one (but not more than one) of the persons
entitled to the bonds under the laws of the State of the decedent's domicile
without administration. The request for payment should be signed in the
form, "A. B., 0. D., B. F., heirs and persons entitled to the estate of X. X.,
deceased ", and should be accompanied by an agreement signed by all persons
entitled, specifying the person to whom payment is to be made or in whose
name the bond is to be reissued. Proof will be required that the debts of the
decedent and of his estate have been paid or provided for, and that the person
to whom payment is requested or in whose name reissue is requested, is entitled to the bonds; such proof will include affidavits of all persons entitled

REPORT OF THE SECRETARY OF THE TREASURY

251

to any share in the estate setting forth the facts in detail and agreeing to the
payment or reissue in question, supported by affidavits of two disinterested
persons having personal knowledge of the decedent and his family, and by a
death certificate or other proof of the death of the owner. (Use Form L. & C.
285, copies of which may be procured from the Treasury Department or any
Federal Reserve bank.) If the gross value of the personal estate exceeds
$500 the Secretary of the Treasury may further require an affidavit or a certificate from a practicing attorney or judicial officer of the State of the decedent's
domicile showing that administration of the estate is not required in such
State and referring specifically to the statutes or the decisions of the courts
of such State under which exemption from administration is claimed, or showing that it is a general and well-recognized practice in that State to settle such
estates without administration.
3. No payment or reissue without administration will be permitted in a case
where any of the persons entitled are minors or under disability, except to
them or in their names or upon compliance with the provisions of sections
VII and VIII hereof governing the payment of Savings Bonds in the names
of such persons.
;

X I V . CREDITORS* E I G H T S

Payment of a Savings Bond will be made in accordance with a judgment or
decree of a court of competent jurisdiction, or proceedings pursuant to such
judgment or decree, except in cases where the action is instituted for the purIpose of giving effect to an attempted transfer by the owner contrary to section
II hereof. In appropriate cases the Treasury Department will require proof
that the court acting had jurisdiction over the parties and subject matter,
and proceeded in due; course of its jurisdiction, and that the judgment or decree
is final and conclusive, that it has fully and effectually transferred the title
of the owner, and that it is not open to attack in any jurisdiction whatever.
For this purpose duly authenticated copies of the complaint, order of service,
return of service, answer, or other pleading, and the final judgment or order of
the court must be furnished, together with a certificate, under seal, from the
clerk of the court, showing that the time for appeal has elapsed without an
appeal having been taken, or that an appeal has been taken and determined
by the court of last resort (in which case certified copy of the rescript or
mandate of such court must be furnished) and that no further appeal is
possible.
XV. D E N O M I N A T I O N A L E X C H A N G E OR R E I S S U E

No denominational exchanges of Savings Bonds will be permitted, and except
as expressly provided by this circular no reissue of Savings Bonds will be made,
whether in the same name or in another name.
XVI. F U R T H E R PROVISIONS

These regulations are prescribed by the Secretary of the Treasury as governing United States Savings Bonds issued under the authority of the Second
Liberty Bond Act, approved September 24, 1917, as amended, and the provisions
of Treasury Departnient Circular No. 800' have no application to such Savings
Bonds except as hereinbefore specifically provided.
The Secretary of the Treasury may at any time, or from time to time,
prescribe supplemental or amendatory rules and regulations governing Uhited
States Savings Bonds.
HENRY MORGENTHAU,

Jr.,

Secretary of the Treasury.
Exhibit 34
Amendment to Department Circular No. 418, as amended May 3, 1934, govern^
ing the sale and issue of Treasury bills
TREASURY DEPARTMENT,

Washington, May 27, 1935.
Department Circular No. 418, as amended May 3, 1934, is hereby further
amended:
'
(1) By adding the following sentence to footnote 2 on page 1: "With respect
to all Treasury bills, attention is invited to Treasury Decision 4550, annexed to
this circular."

252

REPORT OF THE SECEETARY OF THE TEEASUEY

(2) By adding an additional exhibit at the end of the circular, as follows:
" ( T . D . 4550)
" Gift tax on transfers of bonds, notes, bills and certificates of indebledness of
the United States or its agencies
" TRE-ASURY DEPARTMENT,
" OFFICE OP COMMISSIONER OF INTERNAL REVENUE,

" Washington, D. C.
" To CoUectors of Internal Revenue, and Others concerned:
"Article 2 of regulations 79, relating to the gift tax, is amended by inserting
the following immediately after the second sentence:
" ' Various statutory provisions, which exempt bonds, notes, bills, and certificates of indebtedness of the Federal Government or its agencies and the
interest thereon from taxation, are not applicable to the gift tax since this
tax is an excise tax on the transfer, and is not a tax on the subject of the
gift. A gift of a bond, note, or certificate of indebtedness issued by the
Federal Government, if made by a nonresident alien, not engaged in business
in the United States, is not subject to the tax.'
" GUY T. HELVERING,

" Commissioner of Internal Revenue.

"Approved: May 21, 1935.
" T. J. COOLIDGE,

'Acting Secretary of the Treasury."
-

T. J. COOLIDGE,

Acting Secretary of the Treasury.

Exhibit 35
Supplement, dated June 25, 1935, to Department Circular No. 300, July 31, 1923,
prescribing reguHations governing United States bonds and transactions with
the Treasu/ry Department
TREASURY DEPARTMENT,

Washington, June 25, 1935.
1. Treasury Department Circular No. 300, dated July 31, 1923, prescribing
regulations governing United States bonds and transactions with the Treasury
Department therein, is hereby amended by striking out paragraph 33 and inserting in lieu thereof the following:
" 33. Officers authorized to witness assignments:
"(a) In general: The following officers are authorized to witness assignments of United States registered bonds:
" Judges and clerks of United States courts, United States district attorneys,
United States collectors of customs, United States collectors of internal revenue ;
" Executive officers of Federal Reserve banks located in Boston, New York,
Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St, Louis, Minneapolis,
Kansas City, Dallas, and San Francisco, and managers and assistant managers
of the branches thereof;
" Executive officers of Federal land banks;
"Executive officers of banks and trust companies incorporated in the United
States, or its organized territories, and managers of the branches thereof,
domestic and foreign;
" Executive officers of incorporated banks and trust companies in the insular
possessions of the United States doing"business under Federal charter or organized under Federal law;
" Commanding officers of the Army, Navy, and Marine Corps of the United
States (only for members of the Military and Naval Establishments of .the
United States) ;
•
"Diplomatic and consular representatives of the United States on duty
.ahroad, and those officers of the Navy and Marine Corps of the United States
wrho have,certain consular powers under the act approved April 25, 1935;
"Certain officers of the United States Treasury at Washington,
**(&) Assignments for redemption: Assignments by registered payees or assignees of such payees for redemption for their account (where checks in re.ideainption are to be issued to the payee or assignee, as the case, may be) may

EEPORT OF THE SECEETARY OF THE TEEASUEY

253

.•also be witnessed in the United States by notaries public, postmasters, or acting
.postmasters, or by assistant postmasters at first-class post offices, provided that
'the signatures ot notaries public shall be authenticated by their official seals
.and the dates of expiration of their commissions.shaU be given and that the
-signatures of postal officials shall be authenticated by their office stamps.
"(c) Postal savings bonds: In addition to the officers listed in (a) hereof,
assignments of postal savings bonds may be witnessed by a postmaster desig.nated to receive postal savings deposits and, in the case of bonds assigned to
the board of trustees of the Postal Savings System, by assistant postmasters,
postal cashiers, and money-order cashiers at offices designated to receive postal
.-savings deposits. In all cases where the assignment is witnessed by a postal
official other than tfie postmaster, the form of signature to the certificate of
acknowledgment should be the following: * John Doe, postmaster, by Robert
Roe, postal cashier'."
2. The Secretary .of the Treasury may withdraw or amend at any time, or
from time to time, all or any of the provisions of this supplemental circular.
H,

MORGENTHAU,

Jr.,

Secretary of the Treasu/ry.
Exhibit 36
statutes reTaliihg to 16stl stolen, destroyed, mutilated, and defaced bonds and
notes
iXiExtract from regulations of the Treasury Department with respect to United States bonds
and notes (Treasury Department Circular No. 300, dated July 31,1923, as amended) ]

The following statutes of the United States relate to lost, stolen, destroyed,
imutilated, and defaced United States bonds and notes, and claims for relief
.arising in connection therewith:
COUPON BONDS AND NOTES *

Whenever it appe'ars to the Secretary of the Treasury, by clear and unequivocal proof, that any interest-bearing bond of the United States has, without
'bad faith upon the part of the owner, been destroyed, wholly or in part, or so
defaced as to impair its value to the owner, and such bond is identified by
inumber and idescription, the Secretary of the Treasury shall, under such regulations and with such restrictions as to time and retention for security or
otherwise as he may prescribe, issue a duplicate thereof, having the same time
to run, bearing like interest as the bond so proved to have been destroyed or
defaced, and so marked as to show the original number of the bond destroyed
and the date thereof. But when such destroyed or defaced bonds appear to have
been of such a class or series as has been or may, before such application, be
called in for redeniption, instead of issuing duplicates thereof, they shall be
paid, with such interest only as would have been paid if they had been presented in accordance with such call.
(2) Whenever it appears to the Secretary of the Treasury by clear and
.(Unequivocal proof that any interest-bearing bond of the United States, fully
identified by number and .description, has, without bad faith on the part of the
<,owner, been lost to such owner under such circunistances and for such period
of time after it has matured or has become redeemable pursuant to a call for
redemption as in the judgment of the Secretary would indicate that it had
'been destroyed or irretrievably lost, is not held by any person as his own
property, and will not be presented by a bona fide holder for value, the Secretary of the Treasury is authorized to make payment of the amount which would
have been due on .such bond had it been presented at the time it became due
and payable. But no payment shall be made on account of interest represented
by coupons claimed |to have been attached to a missing coupon bond at the time
.of its loss or destruction, -^unless the Secretary of the Treasury is satisfied that
such coupons have not been paid and are in fact destroyed or can never be
made the basis of a claim against the United States: Provided, That where
relief is authorized under the provisions of this paragraph the bond of in.4emnity required by section 3703 of the Revised Statutes shall be in a penal
1 Section 3702 and 3703 apply also to Treasury certificates of indebtedness in bearer
tfopm.

254

REPORT OP THE SECEETARY OF THE TEEASURY

sum of double the amount to be paid and shall be executed by an approved
corporate surety. The Secretary of the Treasury is further authorized to
make from time to time such regulations and restrictions as he may prescribe
with respect to the aidministration of this paragraph.
(3) The term "bond" wherever used in this section and in sections 3703,
3704, and 3705 of the Revised Statutes shall be deemed, for the purposes of
these sections, to include any interest-bearing obligation of the United States
or those issued on a discount basis. (Sec. 3702, Revised Statutes; U. S. Code,
title 31, sec. 735, as amended Apr. 9, 1934.)
The owner of such destroyed or defaced bond shall surrender the same, or
so much thereof as may remain, and shall file in the Treasury a bond in a
penal sum of double the amount of the destroyed or defaced bond, and the
interest which would accrue thereon until the principal becomes due and payable, with two good and sufficient sureties, residents of the United States, to
be approved by the Secretary of the Treasury, with condition to indemnify and
save harmless the United States from any claim upon such destroyed or defaced
bond. (Sec. 3708, Revised Statutes; U. S. Code, title 31, sec. 736.)
REGISTERED BONDS

Whenever it is proved to the Secretairy of the Treasury by clear and satisfactory evidence, that any duly registered bond of the United States, bearing
interest, issued for valuable consideration in pursuance of law, has been lost
or destroyed, so that the same is not held by any person as his own property,
the Secretary shall issue a duplicate of such registered bond, of like amount,
and bearing like interest and marked in the like manner as the bond.so proved
to be lost or destroyed. (Sec. 3704, Revised Statutes; U. S. Code, title 81, sec.
737.)
The owner of such missing bond shall first file in the Treasury a bond in a
penal sum equal to the amount of such missing bond and the interest which
would accrue thereon, until the principal thereof becomes due and payable,
with two good and sufficient sureties, residents of the United States, to be
approved by the Secretary of the Treasury, with condition to indemnify and
save harmless the United States from any claim because of the lost or destroyed
bond. (Sec. 3705, Revised Statutes; U. S. Code, title 31, sec. 738.)
" NOTES " INCLUDED IN CERTAIN PROVISIONS OF STATUTES

The word " bond " or " bonds " where it appears in sections 8, 9, 10, 14, and
15 of this act as amended, and sections 3702, 3703, 8704, and 3705 of the Revised
Statutes, and section 5200 of the Revised Statutes as amended, but in such
sections only, shall be deemed to include notes issued under this section. (Sec.
18 [d], SecondLiberty Bond Act, as amended; U. S. Code, title 31, sec..753 [d].)
CORPORATE SURETY

Whenever any recognizance, stipulation, bond, or undertaking conditioned
for the faithful performance of any duty, or for doing or refraining from doing
anything in such recognizance, stipulation, bond, or undertaking specified, is by
the laws of the United States required or permitted to be given with one surety
or with two or more sureties, the execution of the same or the guaranteeing
of the performance of the condition thereof shall be sufficient when executed
or guaranteed solely by a corporation incorporated under the laws of the United
States, or of any State having power to guarantee the fidelity of persons holding positions of public or private trust, and to execute and guarantee bonds
and undertakings in judicial proceedings: Provided, That such recognizance,
stipulation, bond, or undertaking be approved by the head of department, court,
judge,' officer, board, or body executive, legislative, or judicial required to
approve or accept the same. But no officer or person having the approval of
any bond shall exact that it shall be furnished by a guaranty company or by
any particular guaranty company. (Act Aug. 13, 1894, sec. 1; 28 Stat. 279;
U. S. Code, title 6, sec. 6.) See also sections 2-8 of the same statute, as
amended by the act approved March 23, 1910; United States Code, title 6,
sections 7-13.

REPORT OF T H E SECEETAEY OF T H E TEEASURY

255

PROVISIONS OF P E N A L CODE W I T H RESPECT TO F A L S E C L A I M S , E T C

Making or presenting false claims (sec. 35, as amended) : Whoever shall make
or cause to be made or present or cause to be presented, for payment or approval, to or by any person or officer in t h e civil, military, or naval service of
t h e United States, or any department thereof, or any corporation in which theUnited States of America is a stockholder, any claim upon or against t h e Government of the United States, or any department or officer thereof, or any corporation in which the United States of America is a stockholder, knowing suchi
claim to be false, fictitious, or f r a u d u l e n t ; or whoever, for the purpose of obtaining or aiding to obtain t h e payment or approval of such claim, or for t h e
purpose and with t h e intent of cheating and swindling or defrauding the Government of t h e United States, or any d e p a r t m e n t thereof, or any corporation
in which the United States of America is a stockholder, shall knowingly and
willfully falsify or conceal or cover up by any trick, scheme, or device a material fact, or m a k e or cause to be made any false or fraudulent statements or
representations, or m a k e or use or cause t o be m a d e or used any false bill,
receipt, voucher, roll, account, claim, certificate, affidavit, or deposition, knowing t h e same to contain any fraudulent or fictitious statement or entry, shall
be fined not more t h a n $10,000 or imprisoned not more t h a n 10 years, or both.
(Sec, 5488, Rev. Stats., as a m e n d e d ; U. S. Code, title 18, sec. 80.)
Conspiracy to commit offense against the United States (sec. 37) : If two or
more persons conspire either to commit any offense against the United States,
or to defraud t h e United States in any manner or for any purpose, and one or
more of such parties do any act to effect the object of the conspiracy, each of
t h e parties to such conspiracy shall be fined not more t h a n $10,000, or imprisoned not more t h a n 2 years, or both. (Sec. 5440, Rev. Stats., as amended;U. S. Code, title 18, s e c 88.)
Exhibit 37
P r e s s release, Sept. 25, 1934, respecting the guaro/ntee of bonds of the F e d e r a l '
F a r m Mortgage Corporation a n d the Home Owners' Loan Corporation
TREASURY DEPARTMENT,

Washington, September 25, 1934.
T h e phrase " fully and unconditionally guaranteed " as applied to the bonds,
of both the Federal F a r m Mortgage Corporation and Home Owners' Loan Corporation, in t h e opinion of t h e Secretary of t h e Treasury, concurred in by the-^
Attorney General, means t h a t this is a g u a r a n t y of payment—not merely of
collection—with t h e ' effect that, should either corporation default, the United.
States is obligated to make payment of either principal or interest immediately
when due without requiring t h e holders first to proceed against the corporation.
Bonds of the Federal F a r m Mortgage Corporation issued under the act ap-.
proved J a n u a r y 31, 1934, and bonds of the Home Owners' Loan Corporation
issued under the amendment of April 27, 1934, to the Home Owners' Loan Act
of 1933, a r e guaranteed fully and unconditionally both as to interest and principal by the United States.
Secretary Morgenthau today made public the t e x t of a letter, addressed to>
John H. Fahey, chairman. F e d e r a l Home Loan Bank Board, with the announcement t h a t a letter to the same effect had been sent to W. I. Myers, Governor
of t h e F a r m Credit Administration. The letter follows:
" SEPTEMBER 10,,

1934.

" M Y DEAR MR. F A H E Y : Reference is made to your inquiry respecting the^
Government g u a r a n t y of the bonds of t h e Home Owners' Loan Corporation,
issued under the amendment of April 27, 1934, to t h e Plome Owners' Loan Act
of 1933.
" S e c t i o n 4 (c) of the act, as so amended, provides: ' S u c h bonds shall befully and unconditionally guaranteed both as to interest and principal by the
United States, and such g u a r a n t y shall be expressed on the face thereof* * *,' The bonds issued p u r s u a n t thereto recite upon their face, over the
signature of the Secretary of the Treasury, t h a t ' This bond is fully and unconditionally guaranteed both as to interest and principal by the United States.*'
" The Treasury takes the view t h a t this g u a r a n t y is a g u a r a n t y of payment—
not merely of collection—with the effect t h a t should your corporation fail to.
16816—36
18

256

REPORT OP THE SECRETARY OP THE TREASUEY

pay upon deniand, when due, the principal of, or interest on, these bonds, the
United States would be obligated to make such paynients immediately without
requiring the respective holders first to proceed against your corporation.
" The Attorney General, in an opinion to the Secretary of the Treasury,
dated September 14, 1934, has confirmed the correctness of this view. The
opinion reads in part as follows:
" ' The guaranty being stated by the statute as full and unconditional, there
is no occasion to consider whether a condition should be implied. The separate
provision that the Secretary of the Treasury shall pay if the corporation is
unable to pay upon demand is no part of the guaranty, but merely a provision
for carrying it out in the only reasonably conceivable contingency that would
require such action.
" * Considering the foregoing, it is my opinion that if * * * the corporation should fail, upon demand by a bona fide and accredited holder, to
pay either princiiDal or interest when due, the United States would thereupon
become obligated to make such payment and its obligation would not be conditioned upon the institution of any proceeding by the bondholder against the
corporation.'
"Very truly yours,
" H. MORGENTHAU, Jr.,

" Secretary of the Treasury.
" JOHN H . FAHEY,

** Chairmo/n, Fedei^al Home Loan Bank Board, Washington', D. C"

MONEY'
Exhibit 38
Proclamations and orders relating to silver
PROCLAMATION, A U G U S T 9, 1 9 3 4 , A U T H O R I Z I N G T H E M I N T S TO RECEIVE ALL SIL^^ER
SITUATED I N T H E C O N T I N E N T A L U N I T E D STATES ON T H A T D A I E

Whereas, by paragraph (2) of section 43, title III, of the act of Congress,
approved May 12, 1933 (Public No. 10), as amended by the Gold Reserve Act
of 1934, the President is authorized " By proclamation to fix the weight of the
gold dollar in grains nine-tenths fine and also to fix the weight of the silver
dollar in 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 against the adverse effect
of depreciated foreign currencies, and to provide for the unlimited coinage of
such gold and silver at the ratio so fixed, * * * "; and " The President, in
addition to the authority to provide for the unlimited coinage of silver at the
ratio so fixed, under such terms and conditions as he may prescribe, is further
authorized to cause to be issued and delivered to the tenderer of silver for
coinage, silver certificates in lieu of the standard silver dollars to which the
tenderer would be entitled and in an amount in dollars equal to the number of
coined standard silver dollars that the tenderer of such silver for coinage would
receive in standard silver dollars "; and " The President is further authorized
to issue silver certificates in such denominations as he may prescribe against
any silver bullion, silver, or standard silver dollars in the Treasury not then
held for redemption of any outstanding silver certificates, and to coin standard
silver dollars or subsidiary currency for the redemption of such silver certificates " ; and
Whereas, the Silver Purchase Act of 1934, approved June 19, 1934, provides
in sections 2, 5, and 7, in part, as follows:
" SEC 2. It is hereby declared to be the policy of the United States that the
proportion of silver to gold in the monetary stocks of the United States should
be increased, with the ultimate objective of having and maintaining, one-fourth
of the monetary value of such stocks in silver.
<->. Regulations promulgated during the year with respect to silver and foreign exchange
are available separately and are not reproduced here.

EEPOET OP THE SECRETARY OF THE TEEASURY

257

" SEC 5. The Secretary of the Treasury is authorized and directed to issue
silver certificates iri such denominations as he may from tinie to time prescribe
in a face amount not less than the cost of all silver purchased under the
authority of section 3, and such certificates shall be placed in actual circulation.
There shall be maintained in the Treasury as security for all silver certificates
heretofore or hereafter issued and at the time outstanding an amount of silver
in bullion and standard silver dollars of a monetary value equal to the face
amount of such silver certificates. All silver certificates heretofore or hereafter issued shall be legal tender for all debts, public and private, public
charges, taxes, duties, and dues, and shall be redeemable on demand at the
Treasury of the Uhited States in standard silver dollars; and the Secretary of
the Treasury is authorized to coin standard silver dollars for such redemption.
" SEC 7. Whenever in the judgment of the President such action is necessary to effectuate the policy of this act, he may by Executive order require
the delivery to the United States mints of any or all silver by whomever owned
or possessed. The .silver so delivered shall be coined into standard silver dollars or otherwise added to the monetary stocks of the United States as the
President may determine; and there shall be returned therefor in standard
silver dollars, or any other coin or currency of the United States, the monetary
value of the silver so delivered less such deductions for seigniorage, brassage,
coinage, and other mint charges as the Secretary of the Treasury with the
approval of the President shall have determined: Provided, That in no case
shall the value of the amount returned therefor be less than the fair value
at the time of such order of the silver required to be delivered as such .value
is deteiTnined by the market price over a reasonable period terminating at
the time of such order. * * * »
Now, therefore, finding it necessary, in my judgment, to effectuate the policy
of the Silver Purchase Act of 1934, to assist in increasing and stabilizing domestic prices, to protect our foreign commerce against the adverse effect of
depreciated foreign currencies, and to promote the objectives of the proclamation of the 21st day of December, nineteen hundred and thirty-three, relating
to the coinage of silver; by virtue of the power in me vested by the Acts of
Congress above cited, and other legislation designated for national recovery,
and by virtue of all other authority in me vested;
I, Franklin D. Roosevelt, President of the United States of Anierica, do
proclaim and direct that each United States mint shall receive for coinage or
'for addition to the monetary stocks of the United States, as. hereinafter determined, any silver which such mint, subject to regulations prescribed hereunder
by the Secretary of the Treasury, is satisfied was situated on the effective
date hereof in the continental United States, including the Territory of
Alaska.
The silver so delivered shall be added to the monetary stocks of the United
States and shall be coined from time to time into standard silver dollars in
such amounts as are required to carry out the provisions of this proclamation
and' to provide for the redemption of silver certificates; and there shall be
returned therefor in standard silver dollars, silver certificates, or any other
coin or currency of the United States, the monetary value of the silver so delivered (that is, $1.2929-f a fine troy ounce), less a deduction of 61^5 percent
thereof for seigniorage, brassage, coinage, and other mint charges, such deduction having been determined by the Secretary of the Treasury with my
approval.
The provisions hereof are supplemental to the provisions of the proclamation of the 21st day of December, nineteen hundred and thirty-three, and the
United States coinage mints shall continue to receive for coinage in accordance with the provisions of such proclamation silver which such mint, subject
to regulations prescribed thereunder by the Secretary of the Treasury, is satisfied has been mined subsequently to the date of such proclamation, from
natural deposits in the United States or any place subject to the jurisdiction
thereof: Pi^ovided, however, That the Director of the Mint shall, at the option
of the tenderer of, such silver, deliver. silver certificates in lieu of the standard silver dollars to which the tenderer of such silver for coinage would be
^entitled and in an amount in dollars equal to the coined standard silver dollars that the tenderer of such silver for coinage would receive in standard
silver dollars.
'
The Secretary of the Treasury is authorized to prescribe regulations to carry
out the purposes of this proclamation.

258

REPORT OP THE SECRETARY OP THE TREASURY

Notice is hereby given that I reserve the right by virtue of the authority
vested in me to revoke or modify this proclamation as the interest of the
United States may seem to require.
This proclamation shall bear the date of, and becomes effective on, the day
on which the Secretary or Acting Secretary of State countersigns the same,
affixes thereto tlie Seal of the United States, and deposits this proclamation
so countersigned and sealed in the Office of the Secretary of State, as a part
of the archives of the Nation.
In witness whereof I have hereunto set my hand.
FRANKLIN D . ROOSEVELT.

By the President; and countersigned and sealed with the Seal of the United
States, by direction of the President, this 9th day of August, in the year of our
Lord nineteen hundred and thirty-four, and of the Independence of the United
States of America the one hundred and fifty-ninth.
CORDELL HULL,

Secretary of State.
EXECUTIVE

ORDER, A U G U S T

1 9 3 4 , R E Q U I R I N G T H E DELIVERY
U N I T E D STATES M I N T S

SILVER

THE

By virtue of the authority vested in me by the Silver Purchase Act of 1934
and of all other authority vested in me, I, Franklin D. Roosevelt, President
of the United States of America, do hereby require the delivery of all silver
situated in the continental United States on the effective date hereof, by any
and all persons owning, possessing, or controlling any such silver', and do hereby
require any and all persons owning, possessing, or controlling any such silver
to deliver the same in the manner, upon the conditions ahd subject to the exceptions herein contained, such action being in my judgment necessary to
effectuate the policy of the Silver Purchase Act of 1934.
SEC 2. Silver required to be delivered.—There shall be delivered in accordance
with the terms of this order all silver situated in the continental United
States on the effective date hereof, except silver falling within any of the
following categories so long as it continues to fall thereunder:
a. Silver coins, whether foreign or domestic;
b. Silver of a fineness of 0.8 or less, which has not entered into industrial,
commercial, professional, artistic, or monetary use;
c. Silver mined, after December 21, 1988, from natural deposits in the United
States or any place subject to the jurisdiction thereof; provided, however, that
so much of such silver so mined in the continental United States on or before
the effective date of this order which shall not have been deposited with a
United States mint under the proclamation of December 21, 1983, shall, if
processed to a fineness greater than 0.8 within seventy-five days from^ the
effective date of this order, be delivered in accordance with this order, not
later than ninety days from the effective date hereof, or if processed to a fineness greater than 0.8 after seventy-five days from the effective date of this
order, be delivered within 15 days thereafter in accordance with this order;
d. Silver held for industrial, professional, or artistic use and unmelted scrap
silver and silver sweepings in an amount not exceeding in the aggregate five
hundred fine troy ounces belonging to any one person;
e. Silver o^vned on the effective date hereof by a recognized foreign government, foreign central.bank, or the Bank for International Settlements;
f. Silver contained in articles fabricated and held in good faith for a specific
and customary use and not for their value as silver bullion; or
g. Silver held under a license issued in accordance with section 6 hereof.
SEC 3. Time and place of delivery.—The silver required to be delivered hereunder shall be delivered not later than ninety days from the effective date
hereof to the United States mint nearest to the place where the silver is
situated immediately prior to delivery; provided that such silver temporarily
falling within the exempt categories enumerated in section 2, shall be delivered
at the end of ninety days from the effective date hereof, or 15 days after the
fime when it ceases to fall within such categories, whichever date is later.
Any person acquiring ownership, possession, or control of silver required to be
delivered under this order after seventy-five days .from the effective date hereof,
shall deliver such silver within 15 days of such acquisition.

REPORT OP THE SECRETARY OF THE TREASURY

259

SEC 4. Amount returnable for silver.—The silver herein required to be delivered shall be coined into standard silver dollars, or otherwise added to the
monetary stocks of the United States in accordance with the proclamation,
bearing the same date as this order, relating to .the coinage of silver, and there
:shall be returned therefor in standard silver dollars, silver certificates, or any
other coin or currency of the United States, the monetary value of the silver
so delivered (that is, $1.2929+ a fine troy ounce), less a deduction of 6IV26
percent thereof for seigniorage, brassage, coinage, and other mint cha'rges, as
provided in such proclamation; that is, the amount returnable for the silver
•delivered in accordance herewith shall be an amount equal to 50-f cents a fine
troy ounce, which amount is not less than the fair value, at the time of this
order, of the silver required to be delivered hereunder as determined by the
market price over a reasonable period terminating at the time of this order.
SEC 5. Reimbursement of costs.—The Secretary of the Treasury shall pay all
necessary costs, actually incurred, of the transportation of such silver and
standard silver dollars, silver certificates, and other coin or currency of the
United States, including the cost of insurance, protection, and such other
incidental costs as may be reasonably necessary. Persons desiring reimbursement of such costs shall submit their accounts on voucher forms which may be
obtained by writing; to the Treasurer of the United States, Washington, D. C.
SEC 6. Licenses.-^The Secretary of the Treasury, subject to such regulations
as he may prescribe, acting directly or through such agency or agencies as he
may designate, shall issue licenses authorizing the withholding of silver which
the Secretary of the Treasury, or such agency as he may designate, is satisfied:
(a) Is required for legitimate and customary use in industry, profession, or
art, by a person regularly engaged in such industry, profession, or art or in
the business of processing silver or furnishing silver therefor;
(b) Has been imported for reexport; or
(c) Is required to fulfill an obligation to deliver silver in such amount to a
third person, incurred or assumed by the applicant on or before the effective
date of this order; provided that, at the date of the application, the applicant
owns such silver or holds the obligation of another to deliver to him such silver.
The Secretary of the Treasury may, with the approval of the President,
issue licenses authorizing the withholding of silver for purposes deemed to be
in the public interest and not inconsistent with the purposes of the Silver
Purchase Act of 1934 and of this order.
SEC 7. Deliveries in fulfillment of obligations or to licensees.-—No person
required to deliver silver owned by him or in his possession or control shall
be deemed to have failed to comply with the provisions of this order, if such
silver is delivered in fulfillment of an obligation incurred or assumed by such
person on or before the effective date of this order or is delivered to a person
licensed to acquire and withhold silver in such an amount under section 6.
SEC 8. Definitions.—As used in this order the term " person" means an
individual, partnership, association, or corporation;
The term " continental United States " means the States of t^e United States,
the District of Columbia, and the Territory of Alaska.
The term " United States Mints" means the following mints and assay
offices:
United States Mint, PhUadelphia, Pa.
United States Assay Office, New York, N. Y.
United States Mint, Denver, Colo.
United States Mint, San Francisco, CaUf.
United States Assay Office, Seattle, Wash.
United States Mirit, New Orleans, La,
SEC 9, Penalties, and forfeitures.—All persons are hereby informed of the
following provisions of section 7 of the Silver Purchase Act of 1934 with respect to penalties and forfeitures:
" * * * Any silver withheld in violation of any Executive order issued
under this section or of any regulations issued pursuant thereto shall be forfeited to the United States, arid may be seized and condemned by like proceedings as those provided by law for the forfeiture, seizure, and condemnation of property imported into the United States contrary to law; and, in
addition, any person failing to comply with the provisions of any such Executive order or regulation shall be subject to a penalty equal to twice the
monetary value of the silver in respect of which such failure occurred."

260

REPORT OF THE SECRETARY OF THE TEEASURY

This order shall bear the date of, and become effective on, the day on which
the Secretary or Acting Secretary of State countersigns and deposits this order
so countersigned in the office of the Secretary of State, as a ^part of the
archives of the Nation.
This order may be modified or revoked at any time.
FRANKLIN D . ROOSEVELT. .

Countersigned, by direction of the President, this 9th day of August 1934.
CoRD'EiLL

HULL,

Secretary of State.
EXECUTIVE ORDER, NOVEMBER. 2 , 1 9 3 4 , A M E N D I N G EXECUTIVE ORDER. OF A U G U S T 9,

1934

Executive Order No. 6814 of August 9, 1934, requiring the delivery of silver
to the United States mints, is hereby amended by adding a new section after
section 2 thereof, reading as follows:
" SEC 2A, Silver not required to be delivered.—Silver which at the close of
business on November 7, 1984, falls within category (a), (b), (d), (e), or
(f) of section 2 shall be permanently exempt from the requirement that such
silver be delivered under this order. Silver which after November 7, 1934, but
prior to the time ithat it is first required to be delivered by any person, is
manufactured in good faith into articles described in subdivision (f) of section
2 shall be permanently exempt from the requirement that it be delivered under
this order."
The order, as so amended, may be modified or revoked at any time.
FRANKLIN D . ROOSEI\'ELT.
T H E WHITE HOUSE,

November 2, 1934.

P R O C L A M A T I O N , A P R I L 1 0 , 1 9 3 5 , REDUCING TO 4 5 PERCENT T H E SEIGNIORAGE, E T C , .
ON SILVER M I N E D ON OR AFTER APRIL 1 0 , 1 9 3 5 , A N D RECEIVED UNDER T H E PROCLAM A T I O N OF DEOEMBEIR 2 1 , 1 9 3 3

Whereas, by proclamation of the twenty-first day of December 1933, as modified by proclamation of the ninth day of August 1934, the United States coinage
mints are directed to receive for coinage and addition to the monetary stocks
of the United States silver mined subsequent to December 21, 1933, from natural
deposits in the United States or any place subject to the jurisdiction thereof;
and
Whereas, such proclamation as so modified is subject to revocation or further
modification as the interest of the United States may seem to require.
Now, therefore, finding that the interests of the United States require further
modification of said proclamation of the twenty-first day of December 1933;
by virtue of the power in me vested by the act of Congress cited in saidproclamation, and other. legislation designated for national recovery, and by
virtue of all other authority in me vested;
I, Franklin D. Roosevelt, President of the United States of America, do
proclaim and direct that, with respect to all silver received by a United States
coinage mint under the provisions of the proclamation of the twenty-first day
of December 1933, which such mint, subject to regulations prescribed hereunder by the Secretary of the Treasury, is satisfied has been mined on or
after April 10, 1935, from natural deposits in the United States or any place
subject to the jurisdiction thereof, the deduction for seigniorage and services
performed by the Government shall be 45 percent and there shall be returned
therefor in standard silver dollars, silver certificates, or any other coin or
currency of the United States, the monetary value of the silver so received
(that is, $1.2929-1- a fine ounce), less such deduction of 45 percent.
Notice is hereby given that I reserve the right by virtue of the authority
vested in me to revoke or modify this proclamation as the interest of the
United States may seem to require.
In witness whereof I have hereunto set my hand and caused the seal.of the
Uhited States to be affixed.

REPORT OF THE SECRETARY OF THE TREASURY

261

Done at the city of Washington this 10th day of April, in the year of our
Lord nineteen hundred and thirty-five, and of the Independence of the United
States of America the one hundred and fifty-ninth.
[SEAL]

FRANKUN

D , ROOSEVELT,.

By the President:
CORDELL HULL^

Secretary of State.
PROCLAMATION, APRIL 24, 1985, REDUCING TO 40 PERCENT THE SEIGNIORAGE, ETC., ON
SILVER MINED ON OR AFTER APRIL 24, 1935, AND RECEIVED UNDER THE PROCLAMATION OF DECEMBER 2 1 , 1933

Whereas, by proclamation of the twenty-first day of December 1938, as modified by proclamations of the ninth day of August 1934, and the tenth day of
April 1935, the United States coinage mints are directed to receive for coinage
and addition to the monetary stocks of the United States silver mined subsequent to December 21, 1933, from natural deposits in the United States or any
place subject to the jurisdiction thereof; and
Whereas, such proclamation as so modified is subject to revocation or further
modification as the interest of the United States may seem to require.
Now, therefore, finding that the interests of the United States require further
modification of said proclamation of the twenty-first day of December 1933; by
virtue of the power in me vested by the act of Congress cited in said proclamation, arid other legislation designated for national recovery, and by virtue of all
other authority in me vested;
i I, Franklin D. Roosevelt, President of the United States of America, do proclaim and direct that, with respect to all silver received by a United States
eoinage mint under ttie provisions of the proclamation of the twenty-first day of
December 1983, which such mint, subject to regulations prescribed hereunder by
the Secretary of the Treasury, is satisfied has been mined on or after April 24,.
1935, from natural deposits in the United States or any place subject to the
jurisdiction thereof, the deduction for seigniorage and services performed by
the Government shall be 40 percent and there shall be returned therefor in
standard silver dollars, silver certificates, or any other coin or currency of the
United States, the monetary value of the silver so received (that is, $1.29294- a
fine ounce), less such deduction of 40 percent.
Notice is hereby given that I reserve the right by virtue of the authority
vested in me to revoke or modify this proclamation as the interest of the United
States may seem to require.
In witness whereof I have hereunto set my hand and caused the seal of the
United States to be affixed.
Done at the city Of Washington this 24th day of April, in the year of our
Lord nineteen hundred and thirty-five, and of the Independence of the United
States of America the one hundred and fifty-ninth.
[SEAL]

FRANKLIN D . ROOSEVELT.

By the President:
CORDELL HULLJ

Secretary of State.
ORDER O F T H E S E C R E T A R Y O F T H E T R E A S U R Y O F M A Y 20, 1 9 3 5 , AMENDING THE ORDER

OF JUNE 28, 1934, RELATING TO SILVER

The order of the Secretary of the Treasury of June 28, 1934, relating to
silver, issued in order to effectuate the policy of the Silver Purchase Act of
1934, and under authority of said act is amended, effective from the time of
approval by the President of this amendatory order, by adding after section 11 thereof the fpllowing additional sections which, in the judgment of the
Secretary of the Treasury, are necessary further to eft'ectuate the policy of
said act:
SEC 12. Importation or transportation into the United States.—Except as
otherwise specifically provided in section 14, no person shall import or transport

262

REPORT OP THE SECRETARY OF THE TREASURY

into the continental United States any foreign silver coin, or any other conventional pieces qr forms of silver commonly used in any foreign country as money
or coin, except under license issued pursuant to section 13 of this order.
SEC 13. Import licenses.—The Secretary of the Treasury, subject to such
regulations as he may prescribe, acting directly or through such agency or
agencies as he may designate, may issue licenses authorizing the importation
or transportation into the continental United States of such silver coin or other
conventional pieces or forms of silver which he, or the designated agency, is
.satisfied:
a. Are required to fulfill an obligation to, deliver such silver in the continental
United States, incurred, or assumed by the applicant on or before the effective
•date of this order;
b. Are shipped to the continental United States by, or on behalf or with the
consent of, a recognized foreign government, foreign central bank, or the Bank
for International Settlements;
c. With the approval of the President, for other purposes not inconsistent
with the purposes of the Silver Purchase Act of 1934, or the Silver Agreement
executed at London on July 22, 1933.
SEC 14. Exempt silver coin.—Silver coins of a monetary value equal at the
time of entry to 110 percent or more of the market value of their silver content
and United States silver coins may be imported or transported into the continental United States without the necessity of obtaining a license under this
order.
HENRY MORGENTHAU, Jr.,

Secretary of the Treasury.

Approved:
FRANKLIN D . ROOSEVELT.
T H E WHITE HOUSE,

0, 1935.
Exhibit 39
Statements and official orders relating to the issue of silver certificates
S T A T E M E N T BY T H E TREASURY DEPARTMENT, AUGUST

10,

1934

The Gold Reserve Act of 1934 authorizes the President to issue silver
certificates against any silver bullion, silver, or standard silver dollars in the
Treasury which, at the time of such issue, is not held for redemption of any
outstanding silver certificates.
In accordance with an order of the President issued pursuant to this authority, tlie Secretary of the Treasury is now issuing silver* certificates against
all the free silver which was in the Treasury prior to the approval of the
Silver Purchase Act. This amounted to approximately 62,000j000 ounces,
the cost of which was about $46,900,000. These silver certificates are being
issued on a basis of $1.29 an ounce, because that is required by law for all
silver certificates. The total amount to be issued, under the President's
order, against these 62,000,000 ounces will be of a face amount of approximately
.$80,000,000. The difference between the cost of the silver involved and this
face amount constitutes seigniorage under the law and, as these certificates
are issued, that difference will be shown on the daily statenient as such.
While " seigniorage " now appears in the daily statement for the first time
as a separate item, it has always appeared in tlie Treasury receipt account.
Since the beginning of, the Government, the Treasury has received a total of
$387,000,000 in seigriiorage, which hitherto had been included on the daily
statement under the item " Other miscellaneous."
The silver now being acquired under the Silver Purchase Act will, in
regular course, also form the basis of the issuance of silver certificates. The
silver certificates to be issued against this silver will also, of course, be issued
on the basis of $1.29 per ounce, as required by law. Por the present the
Treasury will issue against this silver an aggregate face amount of certificates
equal to its cost. The difference between tlie cost of the silver which will have
to be held to secure these certificates when they are issued and the monetary
value ($1.29 an ounce) of the silver so held will be carried as seigniorage as
indicated above.

REPORT OF THE SECRETARY OF THE TREASURY
O F F I C I A L ORDERS, A U G U S T 13, AND SEPTEMBER 10,

263-

1934
A U G U S T 13,

1934.

My DEAR Mr. SECRETARY : P u r s u a n t to the a u t h o r i t y vested in me by section
12 of the Gold Reserve Act of 1934, I hereby authorize and direct the issuanceof silver certificates against silver i n the T r e a s u r y not then held for t h e
redemption of any outstanding silver certificates and in a face amount equal
to the amount returned for silver received a t the United States mints and
assay offices on and after J u n e 15, 1934, whether under t h e proclamation of
December 21, 1933, or under the proclamation of August 9, 1934.
P u r s u a n t to the authority vested in me by section 7 of the Silver P u r c h a s e
Act of 1934, I hereby direct t h a t such portion of t h e foregoing silver as is
not held for the redemption of silver certificates shall be added to the monetary
stocks of t h e United States and held as bullion in the General F u n d of t h e
Treasury, but shall be carried on the books of the T r e a s u r y a t cost.
Sincerely yours,
FRANKLIN

ROOSEVELT,

President.
The

H o n o r a b l e the

SECRETARY OF T H E

TREASURY.
A U G U S T 13,

THE

1984.

TREASURER OF T H E U N I T E D STATES.

S I R : P u r s u a n t to the a u t h o r i t y vested in me by section 5 of t h e Silver Purchase Act of 1934, I hereby authorize and direct the issuance of silver certificatesin denominations of $1, $5, $10, $20, and $100 against silver in the T r e a s u r y not
then held for redemption of any outstanding silver certific.ates, and in a face
amount equal to the cost of the silver heretofore or hereafter purchased u n d e r
the a u t h o r i t y of section 3 of such act, whether purchased from t h e stabilization
fund constituted by section 10 of the Gold Reserve Act of 1934 or from o t h e r
sources.
The portion of the fo.regoing silver not held for redemption of t h e silver
certificates referred to shall be added to the monetary stocks of t h e United
States and held as bullion in the General F u n d of t h e Treasury, b u t shall b e
carried on the books of t h e T r e a s u r y a t cost.
Respectfully,
H.

MORGENTHAU,

Jr.,

Secretary of the Treasury.
Approved:
The

F R A N K L I N D . ROOSEVELT.
W H I T E HOUSE,

August 13, 1934.

^
SEPTEMBER 10,

1984.

M Y DEAR MR. PRESIDENT : Reference is made to your orders dated March 12,.
J u n e 14, and August 13, and to my order to the Treasurer of ttie United States,,
approved by you on August 13, 1934, all with respect to the issuance of silvercertificates.
Inasmuch a s the order of J u n e 14 in p a r t supersedes t h e order of March 12,
and in t u r n is closely related to the orders of August 13, I submit for your
approval the following statement combining and, in minor respects, revising,
the provisions of such o r d e r s :
1. The Secretary of the T r e a s u r y is authorized and directed to issue silver
certificates in denominations of $1, $5, $10, $20, and $100 (or in one or more of
such denominations), against any silver in the T r e a s u r y not at the time held'
for redemption of any outstanding silver certificates and in a face amount equal
to the total of the following i t e m s :
( a ) $80,000,000, being an amount approximately equal to thd monetary v a l u e
of all of the silver bullion in the T r e a s u r y on J u n e 14, 1934, not then held f o r
redeniption of any outstanding silver certificates. This amount does not include
silver held in the stabilization fund on J u n e 14, 1934.
(b) $1,560,000, being the amount of series of 1933 silver certificates outstanding on March 12, 1934 (including those held in the T r e a s u r e r ' s c a s h ) .
Silver certificates issued in this amount shall be of the series of 1934 and shall
be issued in lieu of the series of 1983 silver certificates as they a r e redeemed
or otherwise received into the T r e a s u r y and retired.
(c) A sum equal to t h e amount heretofore or hereafter returned to t h e
depositors for silver received a t the United States mints and assay offices
on and after J u n e 15, 1934, whether under the proclamation of December 2 1 ,
1933, or under the proclamation of August 9, 1934.

264

REPORT OF THE SECEETARY OP THE TREASURY

2. In addition to the foregoing, the Secretary of the T r e a s u r y will issue,
as authorized and directed in section 5 of the Silver Purchase Act of 1984,
silver certificates, in denominations of $1, $5, $10, $20, and $100 (or in one
•or more of such denominations), against any silver in the Treasury not a t
t h e time held for the redemption of any outstanding silver certificates, in a
face amount equal to the cost of all silver heretofore or hereafter purchased
under the authority of section 8 of such act, whether purchased from the
stabilization fund constituted by section 10 of the Gold Reserve Act of 1934.,
or from other sources.
3. The silver bullion held as security for silver certificates shall be carried
a t the monetary value of the bullion as defined in the Silver P u r c h a s e Act of
1934 (i. e., $1.2929-1- a fine troy ounce), and there will be held at aU times,
p u r s u a n t to law, an amount in silver dollars and silver bullion of monetary
value, equal to the face a m o u n t of all silver certificates at t h e time outstanding.
4. Such of the silver as is now in, or shall hereafter come into, the Treasury
as bullion and as is not held as security for outstanding silver certificates,
shall be held as bullion in the General F u n d of t h e Treasury, until coined into
s t a n d a r d silver dollars or subsidiary silver coin; and, until pledged as security
for silver certificates or until so coined, shall be carried on the books of t h e
Treasury at cost, except t h a t such an amount of such silver as represents (a)
melted down subsidiary silver coins shall be carried on the books of t h e
Treasury, as heretofore, a t the value of t h e subsidiary silver coins which can
be minted therefrom, and (b) silver previously held for the redemption of silver
certificates, a t t h e monetary value of such silver (as defined in the Silver
P u r c h a s e Act of 1934).
If the foregoing restatement of the provisions of your orders of March 12,
June 14, and August 13, 1934, and my order to the T r e a s u r e r of August 13,
1934, meets with your approval, I should appreciate it if you would indicate
your approval by signing the notation a t the foot hereof.
Faithfully yours,
H.

MORGENTHAU,

Jr.,

Secretary of the Treasury.
THE

PRESIDENT,

The White House.
Approved:
F R A N K L I N D . ROOSEVELT.
SEPTEMBER 12, 1934,

S T A T E M E N T B Y T H E T R E A S U R Y D E P A R T M E N T , OCTOBER 18, 1934, RELATING TO THE
A C C O U N T I N G PROCEDURE WITH REGARD TO SEIGNIORAGE ON SILVER,

Secretary of the T r e a s u r y Morgenthau announced today t h a t seigniorage
resulting from the issuance of silver certificates against silver bullion acquired
under the terms of the Silver Purchase Act of 1934, whether by purchase in the
m a r k e t or by nationalization, will be covered into the T r e a s u r y as a special
receipt in the same manner as the increment resulting from reduction in t h e
weight of the gold dollar. Seigniorage of this character will appear on the
daily T r e a s u r y statement, not under ordinary receipts of general and special
funds, but as a separate item under the same classification as t r u s t funds a n d
increment on gold.
The General F u n d balance on the daily statement will be segregated to show
the amount of seigniorage from this source, and also the amount of the gold
increment in the fund.
Beginning with t h e daily statement a s of the close of business October 16,
the General F u n d balance will be shown a s follows:
Balance of increment resulting from reduction in weight of
the gold dollar
$
Seigniorage
Working balance
Total n e t balance
.- $
All seigniorage on silver other than t h a t received through the issuance of
silver certificates against silver acquired under the provisions of the Silver
P u r c h a s e Act of 1934 will be covered into the T r e a s u r y as an ordinary receipt
and will so appear in t h e daily T r e a s u r y statement.

REPOET OF THE SECRETARY OF THE TEEASURY

265

Exhibit 40
Statement by the Secretary of the Treasury, February 11, 1935, relating to
the stabilization fund
TREASURY DEPARTMENT.

February 11, 1935.
1. Since January 14, banks and dealers in foreign exchange' and gold, have
practically stopped buying and selling gold, within gold import and export
points—which means that the international gold standard as between foreign
countries and the United States has ceased its automatic operation.
2. Thanks to the foresight of the Seventy-third Congress, we now have a
stabilization fund.
3. When we saw that the external value of the dollar was rapidly going
out of control, we put the stabilization fund to work on a moment's notice,
with the result that for the past four weeks we have successfully managed
the value of the dollar in terms of foreigii currencies.
The country can go about its business with assurance that we are prepared
to manage the external value of the dollar as long as it may be necessary.

Exhibit 41
Proclamation, February 14, 1935, extending for tic/o years the period within
which the Federal Reserve Board may authorize the Federal Reserve banlcs
to offer, and the Federal Reserve agents to accept, direct obligations of the
United States as collateral security for Federal Reserve notks
Whereas, the second paragraph of section 16 of the Federal Reserve Act
<38 Stat. 265), as amended by the act of March 6, 1934 (48 Stat. 398), provides:
"Any Federal Reserve bank may make application to the local Federal
Reserve agent for such amount of the Federal Reserve notes hereinbefore
provided for as it may require. Such application shall be accompanied with a
tender to the local Federal Reserve agent of collateral in amount equal to the
sum of the Federal Reserve notes thus applied for and issued pursuant to such
application. The collateral security thus offered shall be nbtes, drafts, bills
of exchange, or acceptances acquired under the provisions of section 13 of this
act, or bills of exchange indorsed by a member bank of any Federal Reserve
district and purchased under the provisions of section 14 of this act, or
bankers' acceptances purchased under the provisions of said section 14, or gold
certificates: Provided, however. That until March 3, 1935, or until the expiration of such additional period not exceeding two years as the President may
prescribe, the Federal Reserve Board may, should it deem it in the public
interest, upon the affirmative vote of not less than a majority of its members, authorize the Federal Reserve banks to offer, and the Federal Reserve
agents to accept, as such collateral security, direct obligations of the United
States * * *."
And whereas it is deemed advisable that the authority of the Federal Reserve
Hoard to authorize the Federal Reserve banks to offer, and the Federal Reserve
agents to accept, direct obligations of the United States as collateral security
for Federal Reserve notes issued to the Federal Reserve banks be continued
for an additional period after March 3, 1935:
'
Now, therefore, I, Franklin D, Roosevelt, President of the United States of
America, acting under and by virtue of the authority conferred upon me by
the aforesaid section 16 of the Federal Reserve Act, as amended, do hereby
proclaim, declare, and prescribe an additional period of two years from and
after March 3, 1935, during whicii the Federal Reserve Board may, should it
deem it in the public interest, upon the affirmative vote of not less than a
majority of its members, authorize the Federal Reserve banks to offer, and
•the Federal Reserve agents to accept, direct obligations of the United States
as collateral security for ITederal Reserve notes issued to the Federal Reserve
banks under the provisions of the aforesaid section.
In witness whereof, I have hereunto set my hand and caused the seal of the
United States to be affixed.

266

REPORT OP THE SECRETARY OF THE TREASURY

Done at the City of Washington this 14th day of February, in the year of
our Lord nineteen hundred and thirty-five, and of the Independence of the
United States of America the one hundred and fifty-ninth.
[SEAL.]

F R A N K L I N D . ROOSEV^ELT.

By the President:
CORDELL HULL,

Secreta/ry of State.
TAXATION^
Exhibit 42
An act to amend certain provisions relatvng to publicity of certain statements
of income, approved April 19, 1935
[Pubhc No. 40, 74th Cong., H. R. 6359]

Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled. That section 55 (b) of the Revenue
Act of 1934 relating to filing and making public certain income statements is
amended to read as follows:
"(b) (1) All income returns filed under this title for any taxable year beginning after December 31, 1934 (or copies thereof, if so prescribed by regulations made under this subsection), shall be open to inspection by any official,
body, or commission, lawfully charged with the administration of any State
tax law, if the inspection is for the purpose of such administration or for the
purpose of obtaining information to be furnished to local taxing authorities as
provided in paragraph (2). The inspection shall be permitted only upon, written
request of the Governor of such State, designating the representative of such
official, body, or commission to make the inspection on behalf of such official,
body, or commission. The inspection shall be made in such manner, and at
such times and places, as shall be prescribed by regulations made by the
Commissioner with the approval of the Secretary.
"(2) Any information thus secured by any official, body, or commission of
any State may be used only for the administration of the tax laws of such
State, except that upon written request of the Governor of such State any such'
information may be furnished to any official, body, or commission of any
political subdivision of such State, lawfully charged with the administration
of the tax laws of such political subdivision, but may be furnished only for
the purpose of, and may be used only for, the administration of such tax laws.
Any officer, employee, or agent of any State or political subdivision, who divulges (except as authorized in this subsection, or when called upon to testify
in any judicial or administrative proceeding to which the State or political
subdivision, or such State or local official, body, or commission, as such, is a
party) any information acquired by him through, an inspection permitted him
or another under this subsection shaU be guilty of a misdemeanor and shall
upon conviction be punished by a fine of. not more than $1,000, or by imprisonment for not more than one year, or both."
Approved, April 19, 1935.
Exhibit 43
Joint resolution to provide revenue, and for other purposes, approved June 28,
1935
[Pubhc Res. No. 36, 74th Cong., H. J. Res. 324]

Resolved by the Senate and House of Representatives of the United States of
America in Congress assemMed, That title IV, as amended, and parts I, II, III,
and IV of title V, as amended, of the Revenue Act of 1932, are further amended
by striking out " 1935 " wherever appearing therein, and inserting in lieu thereof
"1937". Section 1001 (a), as amended, of the Revenue Act of 1932, and section 2, as amended, of the act entitled "An act to extend the gasoline tax for
one year, to modify postage rates on mail matter, and for other purposes ", ap* These exhibits do not include Public No. 20, Mar. 18, 1935, which amends the Agricultural Adjustment Act of May 12, 1933, with respect to the taxation of rice.

REPORT OP THE SECRETARY OP THE TREASURY

267

proved June 16, 1933, are further amended by striking out " 1935 " wherever
appearing therein, and inserting in lieu thereof " 1937."
Approved, June 28, 1935.
Exhibit 44
Processing tax rates under the Agricultural Adjustment Act, and rates of tax on
cotton ginning and tobacco sales, to June 80, 1935, with effective dates
Source of tax

Processing ^
Wheat
Cotton
Tobacco 2

EiJectlve date

July 9, 1933
Aug. 1, 1933
Oct. 1, 1933

Aug.

1, 1934

Rate

30 cents per bushel of 60 pounds.
4.2 cents per pound.
Cigar leaf—^3.0, 3.75, and 5.0 cents
per pound. •
Maryland—1.7, 1.8, and 2.4 cents per
pound.
Burley—2.0, 2.3, and 3.1 cents per
pound.
Flue-cured—4.2, 4.7, and 6.1 cents per
pound.
Fire-cured—2.9, 3.2, and 4.1 cents per
pound.
Dark air-cured—3.3, 3.8, and 5.1 cents
per pound.
Cigar leaf—3.0, 3.75, and 5.0 cents per
pound.
Maryland—1.7, 1.8, and 2.4 cents per
pound.
Burley—2.0, 2.3, and 3.1 cents per
pound.
Flue-cured:
Used in plug chewing tobacco and
twist—3.3, 3.7, and 4.8 cents
per pound.
Other—4.2, 4.7, and 6.1 cents per
pound.

Oct.

For footnotes, see p. 269.

1, 1934

Fire-cured—2.9, 3.2, and 4.1 cents per
pound.
Dark air-cured—3.3, 3.8, and 5.1 cents
per pound.
Cigar leaf—3.0, 3.75, and 5.0 cents per
pound.
Maryland—0 cents per pound.
Burley:
Used in plug chewing tobacco and
twist—4.1, 4:7, and 6.4 cents
per pound.
Other—6.1, 7.0, and 9.5 cents per
pound.
Flue-cured:
Used in plug chewing tobacco and
twist—3.3, 3.7, and 4.8 cents
per pound. •
Other—4.2, 4.7, and 6.1 cents per
pound.
Fire-cured—2.9, 3.2, and 4.1 cents per
pound.
Dark air-cured—3.3,13.8, and 5.1
cents per pound.

268

EEPOET OF THE SECEETAEY OF T H E TEEASURY

Procesing tax rates under the Agricultural Adjustment Act, and rates of tax on cotton
ginning and tobacco sales, to June 30, 1935, with effective dates—Continued
Source of tax

Effective date

Processing ^—Contd.
Tobacco 2—Continued. Feb.

Field corn_
Hogs

Sugar beets and sugarcane.

1, 1935

Nov. 5, 1933
do
Dec. 1, 1933
Feb. 1, 1934
Mar. 1, 1934
June 8, 1934

Peanuts

Oct.

1, 1934

Rice
Paper...

Apr.
Dec.

1, 1935
1, 1938

For footnotes, see p. 269.

Eate

Cigar leaf (including all types of tobacco used in manufacture of cigars
and scrap chewing and smoking tobacco) :
Used in cigars:
Fire-cured tobacco—3.0, 3.25,
and 4.3 cents per pound.
Other—3.0, 3.75, and 5.0
cents per pound.
Used in scrap chewing and smoking tobacco—2.0, 2.5, and 3.3
cents per pound.
Maryland—0 cent per pound.
Burley:
Used in chewing tobacco—2.5, 2.9,
and 3.9 cents per pound.
Other—6.1, 7.0, and 9.5 cents per
pound.
Flue-cured:
Used in chewing tobacco—2,0, 2.3,
and 2.9 cents per pound.
Other—4.2, 4.7, and 6.1 cents per
pound.
Fire-cured:
Used in chewing tobacco—2.0^
2.2, and 2.9 cents per pound.
Other—2.9, 3.2, and 4.1 cents per
pound.
Dark air-cured:
Used in chewing tobacco—2.0,.
2.3, and 3.1 cents per pound.
Other—3.3, 3.8, and 5.1 cents per
pound.
5 cents per bushel of 56 pounds.
50 cents per hundred pounds.
$1.00 per hundred pounds.
$1.50 per hundred pounds.
$2.25 per hundred pounds.
Direct-consumption sugar—0.5 cent
per pound of sugar, raw value.
Sirup of cane juice and edible molasses
from sugarcane—0.125 cent per
pound of sugar content, raw value.
Other than those used in the manufacture of peanut oils—1 cent per pound..
1 cent per pound.
Used in—
Multi-wall bags—2.04 cents per
pound of paper.
Coated bags—3.36 cents per pound.
of coated paper.
Open-mesh paper bags—2.14 cents>
per pound of open-mesh fabric.
Paper towels—0.715 cent per
pound of paper.
Gummed paper tape—4.06 cents,
per pound of paper.

REPORT OP THE SECRETARY OP THE , TREASUBY

269

Processing tax rates under the Agricultural Adjustment Act, and rates of tax on cotton,
ginning and tobacco sales, to June 30 1935, with effective dates—Continued
Effective date

Source of tax

Processing ^—Contd.
Paper—Continued

June 12, 1934

Jute -

Dec.

1, 1933

^
June 12, 1934

Other agricultural
adjustment
Cotton ginning

Tobacco sales _.

Rate

Used in—
Bags, as defined, other than open
mesh:
4.5- to 5.4-pound size—$1.24,
per thousand bags.
5.5- to 7.9-pound size—$1.47
per thousand bags.
8- to 10.9-pound size—$2.02
per thousand bags.
11- to 12.9-pound size—$2.25
per thousand bags.
13- to 16.9-pound size—$3.11
per thousand bags.
17- to 29.9-pound size—$3.96.
per thousand bags.
30- to 74.9-pound size—$7.91
per thousand bags.
Open-mesh paper bags—2.14 cents.
per pound of open-mesh fabric.
Paper towels—0.346 cent per
pound of"paper.,
Gummed paper tape—4.06 cents,
per pound of paper.
Fabric into bags—.2.9 cents per pound,
of fabric.
Yarn into twine—2.9 cents per pound.
of yarn.
Fabric into small bags—2.1 cents per
pound of fabric.
Yarn into twine—2.9 cents per pound.
of yarn.

June

1,19343 5.67 cents per pound of lint cotton produced from ginning.^
June 18, 1935 6.0 cents per pound of lint cotton produced from ginning.f
June 29, 1934 ^ 25 percent of the price received from
first bona fide sale. :

1 Tax applies to the first domestic processing and is measured by the quantity of the commodity put,
in process, unless otherwise specified.
^The 3 rates given apply respectively to farm sales weight, tobacco from which the stem
h a s not been removed, and tobacco from which the stem has been removed.
3 Tax applies to the ginning of cotton harvested after May 31,1934, and to sales of tbbacco harvested after
June 28, 1934.
< 50 percent of average central market price as determined and proclaimed by the Secretary of Agriculture:
in accordance with provisions of the act.

OBLIGATIONS OF FOREIGN GOVERNMENTS
Exhibit 45
Statements by the Treasury Depa/rtment concerning the indebtedness of certain,
foreign goverrwnents to the Urdted States :
AUSTRIA

Announcing the postponement of the payment due from Austria on January 1,,
1935 (press release, Dec. 21, 1934)
The Treasury has been notified by the Department of State that a note
dated November 30, 1934, has been received from the Austrian Minister stating;
that the Austrian Government received on Noveniber 26, 1934, a communication
from the trustees of the Austrian Government guaranteed loan of 1923-43. in

270

REPORT OF THE SECRETARY OP THE TREASURY

which objections were raised against the payment to the creditor governments
signatory to the agreements relative to the settlement of relief debts of the
amounts due to them in 1935, and that in view of these objections no remittance
•can be made to cover the installments due within the next year.
The lien upon the assets and revenues of Austria pledged for the payment
of Austrian relief bonds has been subordinated to the lien upon such assets and
revenues pledged for the payment of the Austrian guaranteed loan of 1923.
The objections by the trustees to the payments due from Austria on account of
the relief bonds is in accordance with the agreements concluded between Austria
and the international relief bonds committee and the agreements between
Austria and the United States dated May 8, 1930, and September 14, 1932,
In accordance with the provisions of the agreement of May 8, 1930, bond no.
7 in the face amount of $460,093, due January 1, 1935, will be postponed and
said amount together with interest at the rate of 5 percent per annum compounded annually to December 31, 1943, is repayable together with further
interest at 5 percent per annum in 25 equal annuities on January 1 of each
•of the years 1944 to 1968, inclusive. The 1935 annuity under the September 14
agreement is postponed and repayable in a similar manner.
The Treasury has heretofore listed Austria as one of the countries that
failed to make certain payments as required by agreements to which the United
States was a party for the reason that the Treasury took the view that the
objections raised by the trustees in November 1933, did not apply to the annuity
of $34,767,23 due January 1, 1934, under the agreement dated September 14,
1932. The Treasury has recently received through the State Department a
copy of a letter dated September 8. 1934, from the trustees to the Austrian
.Min:ster of Finance in which the trustees state that they confirm that their
letter of November 21, 1933, must be considered as covering all payments due
by Austria under the relief credit agreements, including those postponed under
the Hoover moratorium which fell due on January 1, 1934, Information furnished to the Government of the United States indicates that Austria has not
imide any payment due creditors inconsistent with the trustees' letter of September 6, 1934, and also that no creditor, among those who have replied, has
opposed the position taken in that letter.
The Treasury is of the opinion that it would be appropriate to take the view
that the notice of the trustees of November 21, 1933, as more recently clarified,
postponed, in accordance with the provisions of the agreement dated September
14, 1932, the annuity amounting to $34,767,23, otherwise payable on January
1, 1934, A note to this effect has been made upon the records of the Treasury.
FINLAND

Announcing the receipt of payments due from Finland (press releases, Dec.
15, 1934, and June 15, 1935)
DECEMBER 15,

1934,

The Treasury received today the sum of $228,538 from the Government of
Finland, representing a payment of principal in the amount of $62,000, and the
semiannual payment of interest in the amount of $147,507.50 under the funding
agreement of May 1, 1928, and $19,030.50 as the third semiiannual annuity
due under the moratorium agreement of May 28, 1932. This payment represents the entire amount due from the Government of Finland and was paid in
cash through the Federal Reserve Bank of New York.
JUNE 15,

1935.

The Treasury received today the sum of $165,453 from the Government of
Finland, representing the semiannual payment of interest in the amount of
$146,422.50 under the funding agreement of May 1, 1923, and $19,030.50 as the
fourth semiannual annuity due under the moratorium agreement of May 23,
1982. This payment represents the entire amount due from the Government
of Finland and was paid in cash through the Federal Reserve Bank of New
York.
GREECE

Announcing the receipt of interest payments due from Greece (press release,
July 6, 1934)
Acting Secretary of the Treasury Coolidge today announced that the Greek
Government had transferred to the United States Treasury the sum of $196,128,

REPORT OP THE SECRETARY OF THE TEEASURY

271

representing 27i^ percent of the interest amounting to $435,840 due during the
calendar year 1983, and 35 percent of the semiannual interest amounting to
^217,920 ,due May 10, 1934, on the 4 percent loan of 1929.
By the transfer of this sum the Greek Government has accorded to the
United States treatment equal to that accorded to the boridholders of thC;
Greek stabilization and refugee loan of 1928. Such equal treatment is provided for by the terms of the American-Greek debt funding agreement of
May 10, 1929.
Exhibit 46
Correspondence exchanged between the Government of the United States and
various foreign governments concerning foreign debts owing to the United
States (Department of State press releases)
\
BELGIUM

To the Secretary of State from the Belgian Gha/rg4 d'Affaires, December 13, 1934
[Translation]
M R . SECRETARY OF S T A T E :

In your note of November 22, 1934, Your Excellency informed me of the
total of the amounts due to the Government of the United States by the
Belgian Government on December 15, 1934, in accordance with the terms of the
understanding of August 18, 1925, and of the moratorium agreement of June
10, 1982. In the same note Your Excellency was good enough to assure me
that the Government of the United States was entirely prepared to discuss
through diplomatic channels any proposal of the Belgian Government regarding;
a settlement of this debt.
I have the honor to inform Your Excellency that the Government of the
King has noted this communication. It regrets that the reasons which prevented it from resuming on December 15, 1932, the payments interrupted by
the Hoover moratorium, and which were called to the attention of the Ameri•can Government in the note of December 14, 1933, continue to exist in their
entirety.
In view of this the Belgian Government finds itself unable to make the
payments in question on December 15 next.
I take this occasion [etc.].
PRINCE EUGENE D E LIGNE.

To the Secretary of State from the Belgian Ambassador, June 14, 1935
[Translation]
Mr.

SECRETARY OF STATE:

By your note of June 1, 1935, Your Excellency informed me of the amounts
•due to the Government of the United States by the Belgian Government on
June 15, 1935, in execution of the agreement of August 18, 1925, and of the
moratorium agreement of June 10, 1932.
The Belgian Government has had occasion, notably in its notes of December 6,
1932, and of December 14, 1988, to set forth to the Government of the United
:States the reasons why the Belgian Government found it impossible to resume
the payments interrupted by the Hoover moratorium. It will be sufficient
• to recall that the failure of Germany to make payments, by depriving Belgium
of receipts which solemn engagements permitted it to count on, overthrew the
ffnancial plan worked out for the liquidation of the situation created by the war.
To this fundamental difficulty there had been added all the difficulties which
result from the depression. Belgium, an export country, has been particularly
iaffected by the paralysis of interriational commerce. Unemployment became
even more serious in 1934, thus considerably increasing the burden of charges
upon the treasury. The financial capacity of Belgium is closely dependent on
business recovery. The Belgian Government is convinced that an essential
condition for such recovery is the lowering of the barriers which impede international trade. The agreement recently concluded with the United States
constitutes a first step in this direction.
It is necessary to continue to pursue this policy; its success appears as the
essential condition on whicii depends the comprehensive solution of the eco16816—36

272

REPORT OP THE SECRETARY OF THE TREASURY

nomlc and financial problems raised by the Great War. The Belgian Government hopes for this general settlenient.
While recognizing its obligatioiis- toward the Government' of the United
States, it finds itself, to its great regret, not in a position to alter, under the
present conditions, the attitude which circumstances have obliged it to adopt
since December 15, 1932.
I avail myself [etc.].
R. V.

STRATEN.

CZECHOSLOVAKIA

To the Acting Secretary of State from the Minister of Czechoslovakia,
December 14, 1934
EXCELLENCY:

In acknowledging the receipt of Your Excellency's note of November 22, I
have the honor to convey to Your Excellency the following observations of
the Czechoslovak Government.
The Czechoslovak Government having taken a careful estimate of present
circumstances as compared to the situation which prevailed at the occasion of
the presentation of the last note, arrived at the conclusion that no substantial
change so far has taken place in the conditions predominating at that time.
The arguments then set forth unfortunately have lost nothing in their pertinency and validity, and, in the opinion of the Czechoslovak Government, present
circumstances would hardly warrant encouraging prospects for the immediate
resumption of the negotiations.
Notwithstanding these facts the Czechoslovak Government, noting with great
satisfaction the willingness on the part of the Government of the United States
to receive any further suggestion, proposes to follow assiduously any future
developments in existing conditions. The Czechoslovak Government, in accordance with the conclusion of the note of June 11, reiterates its sincere assurances that in the event of any changes arising which might justify substantial
hope of a successful conclusion of the final settlement, the Czechoslovak Government will not fail to avail itself of the opportunity of concurring with the
intimation conveyed in Your Excellency's note relative to proposals for payment of this indebtedness and the eventual submission of it to the American
Congress.
Accept [etc.].
Dr.

FERDINAND VEVERKA,

Envoy Extraordinary and Minister Plenipotentiary of Czechoslovakia.
To the Secretary of State from the Minister of Czechoslovakia, Jume 10, 1935
EXCELLENCY :

In acknowledging the receipt of Your Excellency's note of June 1, 1935, I
have the honor to refer to my note of December 14, 1934, number 804, in which
I was instructed by my Government to stress the fact that the Czechoslovak
Government is taking a careful estimate of current circumstances and prevailing
economic and financial conditions underlying the problem of international
indebtedness and causing the temporary suspension of due installments.
The Czechoslovak Government continued to do so in the intervening period
and profoundly regrets that this assiduous study led to the same conclusion that
no essential change has taken place to warrant substantial prospects for the
resumption of negotiations in this matter at this moment.
Nevertheless, the Czechoslovak Government received with much gratification
the reiteration of the assurance that the Government of the United States is
fully disposed to discuss through diplomatic channels any proposals in regard
to the payment of the Czechoslovak indebtedness, arid will not fail to avail itself
of the first opportunity of presenting any such proposal whenever general conditions substantiate a genuine hope of arriving at a satisfactory conclusion of such
negotiations.
D r . FERDINAND V E V E R K A ,

Envoy Extraordinary and Mimster Plenipotentiary of Czechoslovakia.

REPORT OF THE SECRETARY OF THE TREASURY

273

ESTONIA

To the Secretar]^ of State from the Estonian Minister of Foreign Affairs,
December 4, 1934
EXCELLENCY:

;

I have the honor to invite your attention to my note of the 31st May, 1934,
no. 2-R, regarding the debt funding agreement of 1925 betweeri Estonia and the
United States, and to state the following:
As the economic and financial conditions of Estonia, in spite of the vigorous
steps taken by the Government, have not improved to any appreciable extent
during the last six months, the Estonian Government feel bound to bring to the
knowledge of the United States Government that to their deep regret they are
unable, under the terms of the agreement of 1925, to effect the payment of the
instalment falling due on December 15, 1934.
I avail myself [etc.].
J u u u a SELJAMAA,

Minister of Foreign Affairs.
To the Secretary of State from the Acting Estonian Minister of Foreign Affairs,
Mau 28, 1935
EXCELLENCY :

I have the honor to inform you that the Estonian Government, for reasons
stated in their previous notes, regret to be unable to effect, under the terms of
the debt funding agreement of 1925, between Estonia and the United States of
America, the payment of the instalments falling due during the present financial
year, i. e., on June 15th, 1935, and December 15th, 1935.
I avail myself [etc.].
H. LARETEI,

Acting Minister of Foreign Affairs.

FRANCE

To the Secretary of State from the French Ambassador, December 13, 1934
[Translation]
I have the honor to acknowledge the receipt of Your Excellency's note of
November 22, containing a statement of the amounts due by France to the
United States on December 15, next, under the terms of the agreements of
April 29, 1926, and of July 6, 1931.
In that note you were good enough to assure me that ttie American Government is prepared to discuss, through diplomatic channels, any proposals
which my Government may desire to present concerning payment of this debt,
and to give consideration to such proposals with a view to! presenting them
to the American Congress.
The French Government highly appreciates these assurances and thanks the
American Government for them.
It desires to reaffirm that it does not contest the validity of the debt and
that it remains prepared to seek a settlement with the American Government
on such basis as may appear acceptable to the two countries. Although i t
finds it at present impossible to formulate proposals, it can only hope that
the situation will develop sufficiently to justify, in the near future, undertaking negotiations with a view to assuring the early attainment of the understanding desired equally by the two Governments.
Kindly accept [etc.]
ANDRE DB LABOULAYE.

To the Secretary of State from the French Ambassador, June 12, 1935
[Translation]
I have the honor to acknowledge the receipt of Your Excellency's note of
June 1, transmitting a statement of the amounts due by France to the United
States, June 15, 1935, under the terms of the agreements signed by the French
Government.
*

274,

REPORT OF THE SECRETARY OF THE TREASURY

In presenting this statement, you took occasion to reiterate that the American Government is fully disposed to discuss through diplomatic channels any
proposals which the Government of the Republic may desire to put forward
in regard to the payment of this indebtedness, and to give them careful consideration with a view to their eventual submission to the American Congress.
The French Government thanks the American Government for having been
so kind as to renew these assurances. It desires in turn, referring to its
previous communications, to repeat that it is prepared to seek, as soon as circumstances permit, a settlement of its debt upon bases acceptable to both
countries.
Still finding itself, however, unable to put forward proposals at the present
time, it can only hope that the situation will develop sufficiently to justify,
in the near future, undertaking negotiations with a view to assuring the early
attainment of the understanding desired equally by the two Governments.
Please accept [etc.].
ANDROS D® LABOULAYE.
GREAT BRITAIN

To the Secretary of State from the British Ambassador, December 10, 1934
:SIR:

In accordance with instructions from His Majesty's Principal Secretary of
State for Foreign Affairs I have the honour to acknowledge the receipt of
lyour note of November 22nd enclosing a statement of the amounts due from
His Majesty's Government in the United Kingdom under the provisions of
Tthe debt agreement of June 19th, 1923, and of the moratorium agreement of
-June 4th, 1932.
His Majesty's Government welcome the assurance that the United States
•Government are fully disposed to discuss any proposals, that may be put forward in regard to the payment of this indebtedness and that such proposals
would receive careful consideration with a view to their eventual submission
to Congress.
In June last His Majesty's Government explained the circumstances which
had forced them to decide to suspend paynients under the funding and moratorium agreements pending the final revision of the war debt settlement. In
that note it was stated that recent events had shown that discussions with a
view to a final revision of the settlement could not at that time usefully be
renewed.
His Majesty's Government have again most carefully reviewed the position,
but they regret that they have reached the conclusion that the considerations
which governed their decision six months ago apply with equal force today.
Accordingly they feel that it would be useless and therefore unwise to initiate negotiations at present, but they will continue to watch for any effective
opportunity of taking steps in that direction.
I have the honour [etc.]
R. C. LINDSAY.

To the Secretary of State from the British Ambassador, June 7, 1935
<SIE:

In accordance with instructions from His Majesty's Principal Secretary of
State for Foreign Affairs, I have the honour to acknowledge the receipt of
:your note of June 1st enclosing a statement of the amounts due from His
Majesty's Government in the United Kingdom under the provisions of the
•^debt agreement of June 19th, 1923, and of the moratorium agreement of June
-4th, 1932
In their note of June 4th, 1934, His Majesty's Government explained in full
the reasons for which they were reluctantly compelled to suspend payments
under the above-mentioned agreements pending the negotiation of a final
•revised settlement.
His Majesty's Government have constantly given most careful consideration
to the matter, but they regret that it does not appear to them that the essentials of the situation have changed since that note was written. They observe
with appreciation the readiness of the United States Government to discuss
:any proposals for dealing with the present situation and wish to state that

REPORT OP THE SECRETARY OP THE TREASURY

275

they will be fully prepared to resume discussions whenever circumstances
would appear to warrant the hope that a result satisfactory to both Governments might be expected.
I have the honour [etc.]
R. C. LINDSAY.
HUNGARY

To the Secretary of State from the Hungarian Minister, December 12, 1934
SIB:

I have the honor to inform you that I have been histructed by my Government to advise the Government of the United States that owing to continued
unfavorable economic conditions, the Hungarian Government regrets exceedingly its inability to pay the amount of $49,771.93, representing the principal
and semiannual interest due on December 15, 1934, under the funding agreement
or to deposit its pengo equivalent at the Hungarian National Bank. However,
on that date my Government will deposit to the Foreign Creditors Account at
the Hungarian National Bank a Hungarian Treasury certificate in the pengo
equivalent of the amount due bearing interest at the rate of 2 per centum per
annum.
Accept [etc.].
JOHN

PEL^NYI..

To the Secretary of State from the Hungarian Minister, Jwie 14, 1935
SIR:

I have the honor to inform you that I have been instructed by my Government to advise the Government of the United States that owing to continued'
unfavorable economic conditions, the Hungarian Government regrets exceedingly its inability to pay the amount due on June 15, 1935, urider the funding
agreement or to deposit its pengo equivalent at the Hungarian National Bank.
However, on that date my Government will deposit to the Foreign Creditors^
Account at the Hungarian National Bank a Hungarian Treasury certificate in
the pengo equivalent of the amount due bearing interest at ttie rate of 2 per
centum per annum.
Accept [etc.]
JOHN PEL:^NYI.

ITALY

To the Secretary of State from the Italian Ambassador, December 14, 1934
SIR:

I have,the honor to acknowledge the receipt of your note of November 22,,
enclosing a statement of the amounts due from the Italian Government up to
the 15th of December 1934, under the provisions of the debt agreement of November 14, 1925, and the moratorium agreement of June 3, 1932.
My Government has taken note of the assurance that the United States Government is fully disposed to discuss, through diplomatic channels, any proposals^
the Italian Government may desire to put forward in regard to the payment
of this indebtedness, and has directed me to thank you for this communication..
The Italian Government, while regretting to be now unable to submit any
proposals, will not fail to closely follow the situation. Under the present circumstances, it can only refer to the considerations contained in my note of
June 14, 1934, dealing with the situation existing on that date, which has
remained unchanged.
Accept [etc.]
Rosso.
To the Secretary of State from the Italian Ambassador, June 10, 1935
SIR:

I have the honor to acknowledge the receipt of your note of June Ist,^
1935, enclosing a statement of the accounts due from the Italian Government

276

REPORT OP THE SECRETARY OF THE TREASURY

up to the 15th of June 1935, under the provisions of the debt agreement of
November 14, 1925, and the moratorium agreement of June 8rd, 1932.
My Government has taken note with appreciation of the renewed assurance
that the United States Government is fully disposed to discuss, through diplomatic channels any proposals which the Italian Government may desire to
put forward in regard to the payment of its indebtedness and that such proposals would receive careful consideration with a view to eventual submission
to the American Congress.
While thanking you for this communication, my Government regrets, to be
unable at present to submit any proposals and wishes to refer to the consideraitions contained in my note of June 14, 1934, dealing with the situation existing
on that date, which does not appear to have changed.
Accept [etc.]
Rosso.
LATVIA

Note from the President of the Council and Minister for Foreign Affairs to the
American Charge d'Affaires, Riga, December 13, 1934
MONSIEUR LE CHARG]^ D'AFFAIRES:

I have the honor to refer to the correspondence exchanged between the Ministry for Foreign Affairs and the American Legation regarding the indebtedness of Latvia to the United States and to refer, in particular, to the note of
the State Department of November 22 last, addressed to Mr. A. B. Lule, Latvian Consul General in New York in charge of Legation, in which a statement
was made concerning the amounts due from Latvia and Mr. Lule was assured
that the United States Government are "fully disposed to discuss, through
diplomatic channels, any proposals your Government may desire to put forward in regard to the payment of this indebtedness,'' and that " such proposals
would receive careful consideration with a view to eventual submission to
the American Congress."
The attitude of the Latvian Government regarding the settlement of their
indebtedness to the United States has, as you will remember, already been
defined in my former communications on the subject, in the Aide-Memoire presented to His ExceUency Monsieur Skinner on December Srd, 1932, and, recently, in my note no. R. 763, 00/82 of June 12th last. In this note the Latvian
Government declared themselves obliged to suspend all payments pending the
final revision of the debt-funding agreement of September 24th, 1925. At the
same time they took the opportunity to emphasize once more their willingness
to enter upon a further discussion of the subject at any time when such a
discussion would be agreeable to the Government of the United States.
No reply to this note has up to now been received, and I may therefore
assume that the note of the State Department, dated November 22nd last, may
be regarded as a reply to the statements of the Latvian Government, Mr. Lule
now being assured that the American Government are willing at present to
discuss the proposals the Latvian Government may desire to put forward. As
pointed out to you at the time, such a further discussion of the subject of their
indebtedness is also the desire of my Government.
In view of the fact that the next term of payment faUs due on December
15th, it stands to reason that no definite settlement can be reached at such
short notice. The Latvian Government therefore regret that, for reasons stated
in their previous notes on the subject and owing to the present adverse economic
and financial situation, they will be unable to pay the instalment of their debt
to the United States which falls due on December 15th. It is, however, the
earnest hope of my Government, that it will be found possible to begin the
discussion of the whole subject at the earliest possible date, so that an understanding might be effective which would prove acceptable to both the Governments concerned.
I avail myself [etc.]
K. ULMANIS.

Press release, June 14, 1935
The Department of State was informed by a telegram received from Mr.
Felix Cole, American Charge d'Affaires at Riga, Latvia, that the Latvian
Government in a note delivered to the American Legation at Riga on June 14,
1935, has expressed regret owing to inability to pay the current installment
due on its debt to this Government.

REPORT OF THE SECRETARY OF THE TREASURY

277

LITHUANIA

To the Secretary of State from the Lithuanian Charge dAffaires ad interim,
December I4, 1934
SIR :
With reference to your note of November 22, 1934, transmitting a statement of the amounts due from my Government June 15, 1933, December 15, 1933,
June 15, 1934, and December 15, 1934, under the provisions of the debt agreement of September 22, 1924, and of the moratorium agreement of June 9, 1932,
I have the honor to state that I have been instructed by niy Government to
inform you as follows:
The adverse economic and financial conditions which existed in Lithuania,
as set forth in my note of June 14, 1984, have shown no improvement, but,
on the contrary, the difficulties which confronted Lithuania at that time have
since further increased.
Reaffirming the acknowledgment of its indebtedness to the United States, the
Lithuanian Government regrets very much that it is again forced to arrive at
the conclusion that it is unable to effect payments due the United States
Government on December 15, 1934.
The Lithuanian Government is deeply grateful for the assurance that the
United States Government is disposed to discuss, through diplomatic channels,
any proposals the Lithuanian Government may desire to put forward in regard
to the payment of its indebtedness, and that such proposals would receive
careful consideration with a view to eventual submission to the Congress of
the United States of America.
The Lithuanian Government will be glad to submit proposals relative to its
indebtedness to the United States Government as soon as it will be found that
discussions regarding this matter would be likely to produce inutually agreeable
and' practicable; results.
M.. BAGDONAS,

Charge d'Affaires ad interim.
To the Secretary of State from the Lithuanian Charge d'Affaires ad interim,
June 14, 1935
\
SIR:
.
:
.
I have the honor to acknowledge the receipt of your note of June 1, 1935,
enclosing a statement of the amounts due and payable June 15, 1933, December
15, 1933,.June 15, 1934, December 15, 1934, and June 15, 1935; from my Government pursuant to the terms of the debt agreement of Septefnber 22, 1924, and
the moratorium agreement of June 9, 1932.
In accordance with instructions from my Government, I have the honor to
inform you that no favorable changes have taken place in the economic and
financial conditions which prevailed in Lithuania at the time of the presentation of my notes of. June 14,1934^; and Decerriber 14, 1934.
In view of the above, the Lithuanian Government regrets exceedingly that it
is unable to meet the payments due the United States Government on June 15,
1935.
The Lithuanian Government, reaffirming the acknowledgment of its indebtedness to the United States, reiterates its assurance, as set forth in my note of
December 14, 1934, that it will be glad to submit proposals relative to its
indebtedness as soon as it will be found that discussions regarding this matter
would be likely to produce mutually agreeable and practicable results.
Accept [etc.].
MiKAs BAGDONAS,

Charge d'Affaires ad interim.
POLAND

To the Department of State from the Polish Ambassador, December I4, 1934
[Memorandum]

The Ambassador of Poland has been instructed by his Government to inform
the Government of the United States that for reasons analogous to those stated
in the note of December 8, 1982, and confirmed by later declarations, they are
obliged to request similarly a deferment of payment of the instalment payable
on December 15th, 1984. The Polish Government are still npt in a position to
resume the service of the debt toward the United States.

278

REPORT OF THE" SECRETARY OF THE TREASURY
To the Secretary of State from the Polish Ambassador, June 12, 1935
[Memorandum]

The Ambassador of Poland has been instructed by his Government to inform
the Government of the United States that for reasons analogous to those stated
in the note of December 8, 1932, and confirmed by later declarations, they are
obliged to request similarly a deferment of payment of the instalment payable
on June 15, 1985. The Polish Government are still not in a position to resume,
toward the United States, the service of the' debt.

EUMANIA

To the Secretary of State from the Rumanicm Minister, December 20, 1934
SIB:

In accordance with instructions from my Government, I have the honor to
acknowledge the receipt of your note of November 22nd, enclosing a statement
of the amounts due from my Government June 15, 1983, January 2, 1934, June
.15, 1934, and December 15, 1934, under the provisions of the debt agreement of
December 4, 1925, and of the moratorium agreement of June 11, 1932.
In the note of June 12, 1934, my Government explained the reasons why it
was obliged to suspend the payments on the above-mentioned agreements, and
referred to the note of June 15, 1938, in which it stated the unprecedented
financial difficulties it was facing.
The Rumanian Government, after having carefully reexamined the prevailing
conditions, feels that the reasons which determined its decision last June are
still valid, as no changes have occurred in the general situation which would
permit to expect a favorable result by initiating negotiations-at the present time.
Please accept [etc.].
DAVXLA,

Minister of Rumania.
To the Secretary of State from the Rumanian Minister, June 12, 1935
:
I have the honor to acknowledge receipt of your note of June 1, 1935, enclosing
a statement of the amounts due from my Government June 15, 1933, January 2,
1934, June 15, 1934, December 15, 1934, and June 15, 1935, under the provisions
of the debt agreement of December 4, 1925, and of the moratorium agreement
of June 11, 1982.
In the note of December 20, 1934, I have referred to the reasons why my
Government was obliged to suspend payments under the above-mentioned agreements. The Rumanian Government.feels that those reasons are still valid,
as no changes have occurred in the general situation which would permit to
expect a favorable result by initiating negotiations at the present time.
Please accept [etc.].
SIR

DAVILA,

Minister.
GOVERNMENT DEPOSITS
Exhibit 47
Instructions for collecting agents regarding the receipt of postal money orders
drawn on points 'outside the district in which received
[Accounts and Deposits, Division of Deposits, Circular No. 1]
TREASUBY D E P A R T M E N T ,

July 27, 1934.
To the Heads of Departments and Establishments Concerned:
Under the authority contained in the Act of June 16, 1934 (Public No. 86(5—
73d Cong.) the Postmaster General has prescribed regulations exacting a fee
of the same amount as that charged for the issue of a money order when such
money order is paid at an office other than that on which drawn. The Postmaster General has ruled that money orders drawn in favor of governmental
establishments and agencies are not excepted from the operation of the law.

REPORT OF THE SECRETARY OP THE TREASURY

279

Paragraph 4, of Treasury Circular No. 176 provides, in part, that payments
made by express or postal money order shall be handled subject to collection in
the same manner as cash. Authority is granted, under the terms of the circular,
to deposit cash with general depositaries of public moneys where available.
Paragraph 26, of Treasury Circular No. 176, however, provides' that general
depositaries are not authorized to maintain any collection account for deposits of
public moneys, but are required to give immediate credit in the Treasurer's
account and to issue certificates of deposit for the full amount of all public
moneys deposited with them for credit in the Treasurer's account in accordance
with the circular.
It is requested that all departments, independent establishments, bureaus, and
offices instruct their collecting agents in the field that if postal rnoney orders drawn
on outside points are received, all such money orders should be forwarded to the
Federal Reserve bank or branch of the district for collection arid credit in accordance with the procedure set up by Treasury Circular No. 176 in the case of
checks. Depositors located in the District of Columbia may continue to deposit
all postal money orders, including those drawn on outside points, direct with the
Treasurer of the United States.
STEPHEN B. GIBBONS,

Acting Secretary of the Treasury.
Exhibit 48
Supplement to regulations governing deposit of public moneys and payment of
Government checks and waoTants
[Eighth supplement to Department Circular No. 176]
TREASURY DEPARTMENT,

April 23, 1935.
To the Treasurer of the United States, Federal Reserve Banks and Branches
and Others Concerned:
Treasury Department Circular No. 176, dated September 2, 1930', as amended,
is hereby amended so that the last paragraph of section 34 on page 15 will read
as follows:
"After the expiration of 1 year following the close of the fiscal year (ending
June 30) in which they are drawn, checks drawn on the, Treasurer of the
United States are not payable by him but should be transmitted to the Secretary of the Treasury, Division of Bookkeeping and Warrants, for payment from
the "Outstanding liabilities" appropriation, accompanied by an application for
payment over the signature and address of the owner of such checks: Provided, however. That the l-year restriction does not apply to checks issued on
account of public debt obligations and checks issued on account of transactions regarding the administration of banking and currency laws."
Treasury Department Circular No. 57, dated September 11, 1916, with regard
to " Treasury warrants and official checks of public disbursing officers pertaining to ' Outstanding liabilities'", is hereby rescinded.
H. MORGENTHAU,

Jr.,

Secretary of the Treasury.
ORGANIZATION CHANGES
Exhibit 49
Orders changing organization and procedure in the Treasury Department
TROSASURY DEPARTMENT ORDEIR N C

8, SEPTEMBER 1 7 ,

1934

The Section of Financial and Economic Research in the Office of the Secretary
(Commissioner of Accounts and Deposits) is hereby abolished, and there is
hereby created and established in the Office of the Secretary a Division of
Research and Statistics. There is also hereby created the position of Director
of Research and Statistics.

280

REPORT OP THE SECRETARY OP THE TREASURY

The Division of Research and Statistics will function under the immediate
supervision of the Director. The Division will absorb the duties heretofore assigned to the Section of Financial and Economic Research, and will maintain
statistical and other series, and coriduct economic studies. The Director of
the Division will also exercise direct authority over and responsibility for the
production, analysis, and publication of statistics, and the conduct of economic
research and over the purchase and maintenance of equipment utilized in connection therewith in all branches of the Department, including the Bureau of
Internal Revenue, the Bureau of the Mint, the Customs Bureau, and the Office
of the Comptroller of the Currency; and with the approval of the Secretary
will exercise control over the hiring, classification, and salaries of all employees in the Treasury who are primarily engaged in statistical compilation
or analysis or in' economic research.
This order shall be effective September 17th, 1934, and department orders
of December 6th, 1921, and June 3rd, 19i27, establishing the Section of Statistics
and the Section of Financial and Econoniic Research of the Treasury Department, are hereby modified accordingly.
H. MORGENTHAU, Jr.,

Secretary of the Treasury.
T R E A S U R Y D E P A R T M E N T ORDER N O 9, SEPTEMBER 2 6 ,

1934

All medical relief activities in the Treasury Department in the District of
Columbia, not now a part of or. under,the supervision of the. United States
Public Health Service, are hereby transferred to that Service and placed
under the general supervision of the Surgeon General. These activities in addition to those already a part of the Public Health Service embrace emergency
relief units at the following locations:
1. Main Treasury Building.
2. Treasury Annex No. 1, Madison Place and Pennsylvania Avenue, NW.
3. Internal Revenue Building, 12th Street and Constitution Avenue NW.
4. Old Southern Railway Building, 1300 E Street, NW. (so long as under
the supervision of the Treasury Department).
5. Office of the Register of the Treasury, Fourteenth and B Streets, SW.
6. Branch Treasurer's Office, 119 D Street, NE.
7. Federal Warehouse, Ninth and D Streets, SW.
8. Division of Loans and Currency, Fourteenth and D Streets, SW.
9. Bureau of Engraving and Printing, Fourteenth and C Streets, SW.
10. Washington Building, Fifteenth Street and New York Avenue, NW. (in
process of organization).
All personnel, records, books, furniture, equipment, and supplies connected
with the medical activities concerned are hereby placed under the jurisdiction
and control of the Surgeon General of the Public Health Service, the costs of
the personnel and other expenses involved to be paid from the appropriations
heretofore chargeable with such costs.
The Surgeon General will detail a comnaissioned medical officer of the Public
Health Service to direct the operation of all emergency relief stations in the
Treasury Department.
Emergency medical measures are to be available at the relief stations under
the control of the Public Health Service and such stations are not to be operated
as dispensaries where repeated and long-continued treatment may be obtained.
This order shall be effective October 1, 1934.
H. MORGENTHAU, Jr.

Secretary of the Treasury.
TREASURY

DEPARTMENT

ORDER

NO'. 10, APRIL 2 3 ,

1935

The Division of Supply of the Treasury Department shall be known hereafter
as the "Division of Printing." The Division of Printing shall perform the
same functions as were formerly exercised by the Division of Supply with
the exception that the purchasing functions and the storage and distribution
of stationery supplies, together with such equipment and personnel, including
salaries, as are not required by the Division of Printing are hereby transferred to the Procurement Division, established under the provisions of Executive Order No. 6166 of June 10, 1933, and order of the Secretary of the

REPORT OP THB SECRETARY OP THB TREASURY

281

Treasury, approved by the President on October 9, 1933, and placed under
the immediate jurisdiction of the Assistant Director, Branch of Supply.
Requisitions for printing, binding, and stationery supplies shall be forwarded
to the Division of Printing for administrative approvaL
Requisitions for all other supplies shall be forwarded direct to the Division
of Procurement on the forms prescribed by the Director of Procurement. Payments for all issues will be made by transfer and counter warrants prepared
by the Procurement Division.
TTie stationery stock now in the custody of the Division of Supply shall be
inventoried, priced, and transferred to the Division of Procurement. Credit
shall be given to the Division of Printing in an amount equal to the current
value of stock transferred.
All allotments of appropriations made to the Division of Supply by the
several bureaus and divisions of the Department will be canceled on an effective date to be later determined by the Adniinistrative Assistant to the Secretary. Thereafter bureaus and divisions will maintain such appropriation
accounts as may be necessary.
i
H. MORGENTHAU,

Jr.,

Secretary of the Treasury.
Exhibit 50
Supervision of Bureaus, Offices, and Divisions of the Treasury Department
[Department Circular No. 244^ (Revised)]
TREASURY DEPARTMENT,

Washington, December 7, 1934.
1. The following assignments of bureaus, offices, and divisions of the Treasury
Department are hereby ordered, effective December 7, 1934:
The Secretary of the Treasury:
1. Office of the General Counsel.
2. Bureau of Internal Revenue.
'
3. Procurement Division.
4. Secret Service Division.
The Under Secretary of the Treasury:
1. The Finances.
2. Commissioner of Accounts and Deposits:
(a) Division of Bookkeeping and Warrants.
(b) Division of Disbursement.
(c) Division of Deposits.
'
(d) Section of Surety Bonds.
3'. Commissioner of the Public Debt:
(a) Division of Loans and Currency.
(b) Office of the Register of the Treasury.
(c) Division of Public Debt Accounts and Audit;
(d) Division of Paper Custody.
4. Office of the Comptroller of the Currency.
5. Office of the Treasurer of the United States.
6. Division of Research and Statistics.
Assistant Secretary in Charge of Engraving and Printing, and Mint:
1. Bureau of Engraving and Printing.
2. Bureau of the Mint.
Assistant Secretary in Charge of Customs, Coast Guard, and Narcotics:
1. Bureau of Customs.
2. United States Coast Guard.
3. Bureau of Narcotics.
Assistant Secretary in Charge of Public Health:
1. Bureau of the Public Health Service.
Administrative Assistant to the Secretary:
\
1. Chief Clerk of the Department.
2. Division of Appointments.
3. Division of Supply.
4. Secretary's Correspondence Division.
iThis circular supersedes Department Circular No. 244, dated Sept. 19, 1930.

282

REPORT OF THE SECEETAEY OF THE TEEASURY

. 2. The Administrative Assistant to the Secretary will act as Budget Officer
of the Treasury, and is authorized to act, for and by direction of the Secretary
.of tJie Treasury, in any branch of the Department.
3. In the absence or sickness of the Secretary, the Under Secretary will act
as Secretary of the Treasury. In the absence or sickness of the Secretary and
the Under Secretary, the senior Assistant Secretary on duty will act as
Secretary.
4. The Bureau of the Budget of the Treasury operates under the immediate
direction of the President.
5. This circular supersedes Treasury Department Circular No. 244, dated
September 19, 1930.
H. MORGENTHAU,

Jr.,

Secretary of the Treasury.

MISCELLANEOUS'
Exhibit 51
Executive Order No. 6869, October 10, 1934, requiring certaim, finanxnal statements to be furnished the Secretary of the Treasury
By virtue of and pursuant to the authority vested in me as President of the
United States, and in furtherance of the provisions of Executive Order No. 6226,
of July 27, 1933, I hereby prescribe the following regulations:
1. Every executive department and every independent establishment of the
Government shall furnish the Secretary of the Treasury, not later than the 15th
day of each month, a statement of all bonds, notes, debentures, shares of stock,
and other such evidences of indebtedness or interest, held by it for account of
the United States, but exclusive of trust funds, and of all liabilities of the
United States incurred through it represented by bonds, notes, debentures, or
other such evidences of indebtedness. The statements herein required to be
furnished shall be made as of the close of business on the last business day of
the preceding month.
2. Every corporation in which the Government of the United States has a
proprietary interest shall furnish the Secretary of the Treasury, not later than
the 15th day of each month, a statement of its assets, liabilities, capital, and
surplus as of the close of business on the last business day of the preceding
month. Corporations in which the United States has no proprietary interest
other than that evidenced by preferred stock and/or capital notes acquired
through the Reconstruction Finance Corporation, shall not be considered corporations in which the Government of the United States has a proprietary
interest within the meaning of such phrase as used in this order.
- 3. The Secretary of the Treasury shall cause to be published monthly on the
daily statement of the United States Treasury a combined statement of the
assets, liabilities, capital, and surplus, reported pursuant to the provisions of
this order at such times and in such manner as he shall prescribe.
4. The Secretary of the Treasury is authorized to prescribe a form or forms
on which the required reports shall be made and to issue such ,regulations
or instructions as he may consider necessary for the purpose of carrying out
the provisions of this order.
FRANKLIN D . ROOSEVELT.
T H E WHITE HOUSE,

October 10, 1934.
^ The following are available separately and are not reproduced here: Department
Circular No. 230, revised Oct. 1, 1934—Eegulations governing the recognition of attorneys
and agents representing claimants and others before the Treasury Depart'ment; Department Circular No. 230, revised Oct. 1, 1934—Supplementary rules of procedure in suspension and disbarment proceedings; Department Circular No. 154 (revised), amended
Feb. 6, 1935—Eegulations relating to the acceptance of bonds, notes, or other obligations issued! or guaranteed by the United States as security in lieu of surety or sureties
on penal bonds; and Department Circular No. 538, Mar. 28, 1935—Eegulations governing payment of losses sustained by officers and employees of the Treasury Department
in foreign countries due to appreciation of foreign currencies in their relation to the
American dollar.

EEPORT OF THE SECRETARY OP THE TREASURY

283

Exhibit 52
Regulation no. 1—Administrative procedure for the maintenance of the sy sterna
of accounts and disbursem,ents under the Emergency Relief Appropriation
Act of 1935, established pursuant to section I I (A) o f Executive Order
No. 7034
I
[Department Circular No. 543]
TREASURY DEPARTMENT,

Washington, June 18, 1935.
Pursuant to ttie provisions of section IV, of Executive Order No. 7034, dated
May 6, 1935, issued by virtue of and pursuant to the authority vested in the
President of the United States under the Emergency Relief Appropriation Act
of 1935, approved April 8, 1935 (Pub. Res. No. 11, 74th Cong.), the following
regulations governing the maintenance, of a system of accounts and disbursements under section II (A) of such order are hereby prescribed:
GENERAL P U R P O S E S

1. Section II (A) of Executive Order No. 7034 directs:
" The Secretary of the Treasury, (1) through the disbursing and accounting
facilities under the Commissioner of Accounts and Deposits; of the Treasury
Department, to make provision for all disbursements from the funds appropriated by the * Emergency Relief Appropriation Act of 1935', subject only to
such, exceptions as the Secretary may authorize, and to maintain a system of
accounts necessary to enable the President—
"(a) to exercise Executive control over such funds,
' ( b ) to provide current financial and accounting information for governmental agencies concerned, and
"(c) to make a complete report to the Congress concerning expenditures
made and obligations incurred, by classes and amounts * ^ *."
DEFINITIONS

2. As used herein:
(a) The word "allocation" means the amount made available by the President as carried in appropriation warrants for which separate appropriation
accounts will be carried. An allocation may cover one or more projects.
Such allocations are identified with an applicable appropriation limitation in
the act.
(b) The words "official project" mean an undertaking approved by the
President for which a separate official project number has been assigned by
the Bureau of the Budget. An official project may be either a single work
project or a general work relief program consisting of a num.ber of work
projects.
(c) The words "work project" mean a particular job or subdivision of an
official project, as designated by an Administrator. This may be a single work
relief job or a group of jobs in a particular locality under a project manager.
A work project may be identical with an official project or it may be a subdivision or part of an official project for which separate limitations are to be
observed through administrative accounts.
(d) The words "project authorization " mean that part (or all) of an allocation which has been set up on the books of the central or other Treasury
accounts office of the Commissioner of Accounts and Deposits on account of
a particular project or of a subdivision of an allocation designated by an
administrator.
(e) The word " administrator " means a board, commission, or the head of a
department, bureau, or other agency authorized to administer ah allocation.
(f) The words "State administrator" mean a person having general supervision of work or relief in a State or other area who is under the supervision
of an administrator.
(g) The words "district director" mean a person having supervision over
work or relief in a county or district within a State who is under the general
supervision of an administrator or a State administrator.
(h) The words "project manager" mean a person having supervision of,
a work project who is authorized to incur obligations under an allotment.

284

REPORT OP THE SECRETARY OP THE TREASURY

This term may include administrators. State administrators, or district
directors who act tn the capacity of project managers.
(i) The words " certifying officer " mean a person duly authorized to attest
to the correctness and legality of the services rendered or articles furnished
as set forth on pay rolls or vouchers to be ^bmitted to a disbursing officer
for payment.
(j) The word "allotment" means the amount of an authorization on a prescribed form issued by an adhiinistrator or other authorized person to a project
manager, authorizing the latter to enter into contracts, to make purchases or
pay-roll commitments or to incur other obligations, for a work project.
(k) The words " Treasury accounts office" mean the United States TreasuryState accounts office located in the State in which detailed accounts will be
kept with respect to allotments and expenditures for particular projects, and
to which all accounting documents relating to such projects must be sent.
ORGANIZATION

3. The Oommissioner of Accounts and Deposits, Treasury Department, is
authorized and directed to establish and maintain a Treasury Central Accounts
Office in the District of Columbia and such United States Treasury-State
accounts offices and United States Treasury-State disbursing offices there and
elsewhere as in his judgment may be necessary to effectuate the.purposes of
section II (A) of Executive Order No. 7034, and the Commissioner, with the
approval of the Secretary, is authorized to employ personnel for such purposes.
The Commissioner is further authorized to prescribe such administrative
procedures and take swch other action as may be necessary. Treasury accounts
offices shall maintain such detail records for projects undertaken within their
respective districts as may be necessary for accounting purposes.
FISCAL PROCEDURE

4. Appropriation.—The amount made available by the Emergency Relief
Appropriation Act of 1935 shall be set up in administrative appropriation control accounts to be maintained in the United States Treasury Central Accounts
Office, in accordance with the limitations contained in said act and such other
limitations as the President may fix.
5. Resolutions.—In order that the Treasury Department may be kept currently informed, the executive secretary of the Advisory Committee on Allotments shall transmit to the Treasury Central Accounts Office not later than
the day following the date of each meeting of such Committee, a certified
copy of each resolution agreed to concerning, the earmarkings, allocations,
rieallocations, releases, reductions, cancelations, allotments, transfers, or other
disposition of funds.
6. Reserves.—(certified copies of all orders issued by the President earmarking or reserving funds shall be furnished to the Treasury Central Accounts
Office by the Bureau of the Budget for the maintenance of controlling accounts.
7. Allotments or authorizations.—The Advisory Committee on Allotments
shall furnish the Treasury Central Accounts Office with a certified copy of
each resolution passed by it, accompanied by copies of applications upon which
-each resolution is based. The Advisory Committee on Allotments shall also
furnish the Treasury Central Accounts Office a schedule of applications submitted by. the Committee to the President which are rejected or are increased
or decreased above or below the amounts previously reported under section 5.
B. Allocations.— (a) The Bureau of the Budget shall transmit currently to
the Treasury Central Accounts Office and to the General Accounting Office
c6ples of all orders issued by the President making allocations or any other
4!isposa.tion of funds, including any limitations which, the. President has imiposed in connecftion with such allocations or allotments or any amendment of
a prior allocation or allotment.
(b) Allocations shall be numbered by the Bureau of the Budget in the order
of their approval by the President.
(c) Upon receipt in the Treasury Department of an order or Tetter of the
F'resident making an allocation, the Division of Bookkeeping and Warrants,
Treasury Department, shall issue an appropriation warrant against the/proper
limitation contained in. the Eniergency Relief Appropriation Act of 1935, and
a copy of such order or letter, supported by such detail as may be required
Iby the Comptroller General of the United States, shall be furnished to the

EEPORT OF THE SECRETARY OF THE TREASURY

285

General Accounting Office. After the appropriation warrant has been countersigned by the Comptroller General of the United States, a certified copy thereof
shall be forwarded by the Division of Bookkeeping and Warrants to the Treasury Central Accounts Office. On the basis of such certified copies of appropriation warrants, the Treasury Central Accounts Office shall charge the proper
limitations and esta!blish the necessairy controlling accounts.
9. Advice of allocations.—(a) The Treasury Central Accounts Office shall
notify the proper Administrator of any allocation through the issuance of an
"Advice of Allocation."
(b) Advices of Allocations shall be numbered by the Treasury Central Accounts Office in regular numerical sequence..
10. Advice of project authorization.— (a) The Administrator shall issue an
"Advice of Project I Authorization" on a prescribed form for the purpose of
advising State Adriiinistrators and other designated persons, through the
Treasury Central Accounts Office, of the amounts to be set up on the books
of the appropriate Treasury Accounts Office for expenditure on a particular
project or subdivision of an allocation. Advices of Project Authorization
shall show the number and date of the Advice of Allocation under which such
authorizations are made.
(b) Advices of Project Authorizations shall be made in quintuplicate, viz, for
(1) the Treasury Central Accoimts Office, (2) the appropriate Treasury
Accounts Office, (3) the Administrator, (4) the State Administrator or other
proper person, and (5) the General Accounting Office.
(c) The Administrator shall number Advices of Project Authorization in
regular numerical sequence, and shall designate, subject to the approval of
the Treasury Central Accounts Office, the appropriate Treasury Accounts Office
which shall maintain detail records of such authorization. A schedule showing the location of each Treasury Accounts Office will be furnished to administrators by the Commissioner of Accounts and Deposits.
(d) Advices of Project Authorization shall show the appropriation symbol
and title, official project number, and such other references and information
as may be required by the Commissioner of Accounts and Deposits.
(e) The Administrator shall furnish the Treasury Central Accounts Office,
on forms provided by the Treasury Departnient, with authenticated specimen
signatures of persons authorized to sign Advices of Project Authorization, together with a statement of the limitations, if any, on their authority to issue
such Advices.
,
11. Advice of allotment.— (a) State administrators or persons designated in
an Advice of Project Authorization shall issue, in accordance with such authorization, an "Advice of Allotment" to project managers for the purpose of
authorizing them to procure services, to make purchases through authorized
procurement procedure, to make pay-roll commitments, or to incur other obligations, for the objects indicated on the said advices of allotment.
(b) Advices of Allotment shall be numbered in regular sequence by the State
Administrator or other designated person, and this number shall be entered
on all purchase requisitions, contracts, pay rolls, and vouchers relating to the
allotment.
(o) Advices of Allotment shall show the official project number, the appropriation symbol and title, the Treasury Accounts Office on which issued, and such
other information as the Commissioner of Accounts and Deposits may require
in connection with tlie checking of vouchers and pay rolls submitted thereunder.
(d) Immediately after issuance of each Advice of AUotment, a duplicate
thereof shall be transmitted to the appropriate Treasury Accounts Office for
entry in its accounts. The Treasury Accounts Office shall determine that
vouchers subsequently received and chargeable thereto do not exceed the
amount of the allotment and are for the objects or purposes specified thereon.
(e) The Administrator shall furnish the appropriate Treasury Accounts
Office with authenticated specimen signatures of State Administrators or other
persons authorized to issue Advices of Allotment, together with a statement of '
the limitations, if any, on the authority of such persons to issue Advices of
Allotment.
12. Encumbfances for contracts, purchase orders, etc.— (a) The records of
the- Treasury Accounts Offices shall refiect as currently as practicable the accruing liability of the Government on account of each project. To this end
administrators and iother designated officers shall furnish the appropriate
Treasury Accounts Office such information as it may require.

286

REPORT OF THE SECRETARY OF THE TREASURY

(6) Copies of contracts and purchase requisitions or orders and copies of
papers, advices, or documents covering encumbrances or obligations incurred,
shall be sent, promptly after issuance, to the appropriate Treasury Accounts
Office designated on the related Advices of Allotment.
(c) Each purchase requisition, purchase order, contract, or other advice of
obUgation incurred shall show the official project number, the work project
number (if any), the serial number of the Advice of Allotment under which
such obligation was incurred, the appropriation symbol chargeable, and such
other references as may be required by the Commissioner of Accounts and
Deposits.
(d) Original contracts shall be numbered and forwarded to the General
Accounting Office in accordance with General Accounting Office General Regulations No. 51, and supplements thereto.
13. Vouchers and pay rolls.— (a) All vouchers and pay roUs shall be certified
by project managers or by such other persons as may be authorized to do so.
(b) Except as otherwise specifically authorized by the Secretary of the
Treasury, all vouchers and pay rolls chargeable against an allocation made
under the Emergency Relief Appropriation Act of 1935 shall be forwarded
to the appropriate Treasury Accounts Office designated on the Advice of
Allotment, where they will be checked against the records of Project Authorizations and Allotments and forwarded to the appropriate Treasury Disbursing
Office as provided in section 16 hereof.
(c) Vouchers and pay rolls shall be certified only by authorized project
managers or other " certifying officers" who either have personal knowledge
or documentary evidence of the facts upon which the vouchers or pay roUs
are based, or who have immediate charge of the persons who have such
knowledge.
(d) Adequate timekeeping records shall be maintained, showing for each
employee time and 'earnings chargeable to the various project or cost accounts, deductions, and net earnings, and a procedure shall be established to
verify the fact that each individual to whom payment is made is legally entitled
thereto.
.(e) Certifying officers shall keep or be responsible for the keeping of time
records and other records herein provided to avoid dupUcate payments, and
will be accountable for the legality of vouchers and pay rolls certified by them.
Such officers shall be responsible for the correctness of the facts on which the
vouchers and pay rolls are based and also for the inathematical computations.
(f) Authenticated specimen signatures of certifying officers shall be filed in
the appropriate Treasury accounts offices and Treasury disbursing offices, together with a statement of the limitations, if any, on the authority of such
persons to certify vouchers and pay rolls.
(g) All vouchers shall show the appropriation symbol and title, and official
project number, against which such vouchers are chargeable, the number of
the purchase order, contract, or other document obligating funds under the
project, and such other material facts as may be necessary to enable the General Accounting Office -to settle and adjust the amounts for which credit is to
be claimed by the disbursing officer.
14. Voucher distribution form.—The certifying officer shall transmit to the
appropriate Treasury accounts office attached to each voucher or pay roll, a
prescribed form of Voucher Distribution Form showing the amounts included
in the voucher or pay roll, classifled according to different objects of expenditure, and such other data as may be required by the Commissioner of Accounts
and Deposits.
15. Examination of vouchers and pay rolls in Treasury accounts offices.—^No
Treasury accounts office shall transmit a pay roll or voucher to a disbursing
office for payment unless such office shall find that sufficient money is available
in the proper account to meet the payment; that the voucher or pay roll is
covered by a contract, purchase requisition, or other proper obligating document; that the mathematical computations in the voucher are correct; and
that the voucher or pay roll has been certified by an authorized certifying
officer, whose authenticated specimen signature is on file in such Treasury
accounts office.
16. Scheduling of vouchers and pa^ rolls.— (a) Vouchers and pay roUs shall
be scheduled on Standard Form. 1064, in the offices where the vouchers are
administratively approved, and transmitted, in quadruplicate, to the appropriate Treasury accounts office. Schedules of vouchers and pay rolls shall be
summarized on Standard Form 1064, by appropriation symbols and titles.

REPORT OP THE SECRETARY OP THE TREASURY

287

(b) Checks for travel advances will be issued only upon approved applications therefor (Standard Form 1038 or 1038a) when supported by authenticated copies of the!travel orders issued toi the employees and such approved
applications shall be scheduled in the Treasury Accounts Office to the proper
Treasury disbursing office.
(c) Cash for disbursing purposes may be carried only when specifically
authorized by the Secretary of the Treasury pursuant to Section 3620 of the
Revised Statutes. In making requests for authority to carry cash, which will
be at personal risk of disbursing officers, justification therefor must be fully
set forth. Checks issued in exchange for cash will be scheduled in the Treasury Disbursing Office and a copy of each such schedule shall immediately
be forwarded to the appropriate Treasury accounts office.
(d) After examination pursuant to section 15 hereof, vouchers and pay rolls,
accompanied by the original and two copies of the schedules, shall be transmitted by the Treasury Accounts Office to the Treasury Disbursing Office for
payment, except as to items of transportation furnished on Government transportation requests and bills of lading forms and questionable claims which
shall be scheduled to the General Accounting Office for preaudit and then returned to the appropriate Treasury accounts office for completion of records
and forwarding to the appropriate Treasury Disbursing Office for payment.
Bills of lading and transportation requests must show the office to be bUled
and other necessary information.
17. Advance of funds to disbursing officers and rendition of accounts.—(a)
In order to expedite the placing of funds to the credit of bonded disbursing
officers and to facilitate the audit and settlement of their accounts, funds
shall be advanced upon accountable warrants to the Chief Disbursing Officer,
Division of Disbursement, under the several appropriation-allocations, based
upon requisitions approved by the Commissioner or Assistant Commissioner
of Accounts and Deposits, or such other officers as the Secretary of the Treasury
may designate. The Chief Disbursing Officer shall transfer to the official
credit of such of the various bonded Disbursing Officers with the Treasurer
of the United States in Washington or in the Treasurer's account vrith the
Federal Reserve banks as directed by the Commissioner or Assistant Commissioner of Accounts and Deposits, or by such other officers as the Secretary
of the Treasury may designate, the amounts necessary to make current
disbursements. The Chief Disbursing Officer shall take credit in his accounts
under the proper appropriation-allocations for the amounts so transferred to
disbursing officers, and they, in turn, shall charge themselves with such
transfers and render an accounting therefor in their own names to the General
Accounting Office, through the Central Treasury Accounts Office.
(b) All officers disbursing funds appropriated by the Emergency Relief
Appropriation Act of 1935 shall render to the General Accounting Office as
at the close of business on the 10th, 20th, and last day of each month a separate and complete accounting for all funds coming into their custody during
the period covered by each account, by reason of their official positions, in
accordance with General Accounting Office General Regulations No. 80, dated
August 15, 1934.
18. Administrative verification of check payments.— (a) Treasury disbursing
officers shall transmit promptly to the appropriate Treasury accounts offices
copies of all checks^ issued by them for verification against copies of schedules
and pay rolls on file in the Treasury Accounts Office.
(b) Stocks of blank checks shall be kept in the custody of Treasury disbursing officers. Treasury disbursing officers shall account to the appropriate
Treasury accounts offices for all checks delivered to them under a procedure
prescribed by the Commissioner of Accounts and Deposits, which shall provide
for the transmission of notices of delivery directly to the appropriate Treasury
accounts office by ttie Bureau of Engraving and Printing. Treasury accounts
offices shall take inventories of stocks of unused checks not less than once in
each quarter and without advance notice to the disbursing officer.
(c) Spoiled checks shall be voided and the space provided thereon for
signatures effectively mutilated. They shall then be forwarded to the Treasury
Accounts Office for examination, and the check copies in such cases shall also
be voided. After examination in the Treasury Accounts Office the voided
checks shall be returned to the Treasury Office for disposition in accordance
With the provisions of Treasury Department Circular No. 8, and General
Accounting Office General Regulations Nos. 31 and 85.
•
16816—36

288

REPORT OF THE SECRETARY OF THE TREASURY

19. Disbursements not made through Division of Disbursement, Treasury
Department.—In cases where disbursements are not made through the Division
of Disbursement, Treasury Department, copies of allotments, purchase requisitions, purchase orders, contracts, disbursement schedules, vouchers, pay rolls,
check registers, etc., will be promptly forwarded to the Treasury accounts
office specified by the Commissioner of Accounts and Deposits, and the general
principles embodied in the system; of accounting for project authorizations,
allotments, etc., as outlined herein for payments made through the Division
of Disbursement, Treasury Department, will be followed.
20. Interdepartmental work.—In cases where one Government department or
establishment has agreed to perform: services or furnish materials for another
department Or establishment, the amounts involved being relatively small, the
work shall be done frorn the requisitioned Department's own appropiration on
a reimbursable basis. However, where, upon a proper showing to the Bureau
of the Budget, the requisitioned Department or establishment is unable to
perform the services or furnish the materials on a reimbursable basis, within
the limits of its own appropriation, the transactions shall be handled through
the issuance of an Advice of Allotment (approved by the Bureau of the Budget)
on account of the official project involved to the requisitioned department pr
establishment by the requisitioning department or establishment.
21. Requisitions for forms.—Upon receipt of these regulations each administrator concerned is requested to make requisition at once upon the Public
Printer for a supply of the forms provided for herein which it is estiniated will
be required for his service for a period of 12 months from July 1, 1935. In so
doing, it is understood and agreed by the said administrator that he thereby
consents to the plan of combining all the requisitions submitted and printing
the total amount thereof in one edition, to be delivered to him or placed in
stock at the Government Printing Office subject to his order, or partly delivered
and partly placed in stock as the case may be, and that the administrator
authorize the Public Printer to prorate the cost of printing and to render bill
against him for his proportionate share on the basis of the number of forms
ordered by him.
22. Budgetary apportionments of fund>s.—^The provisions of Executive Order
No. 6226, dated July 27, 1933, and Treasury Department Circular No. 494,
issued pursuant thereto relating to apportionments shall be applicable to aUocations of funds under the Emergency Relief Appropriation Act of 1935.
23. Duplication of records. — The heads of departments, establishments,
boards, commissions, bureaus, and offices are requested to utilize to the fullest
extent the accounting records provided herein and to avoid, as much as possible, unnecessary duplications of accounting records.
24. Special instructions.—When the Secretary of the Treasury finds that the
public interest requires, he may issue special instructions to cover the procedure for exceptional cases, which instructions shall conform as nearly as
practicable to the principles embodied in the foregoing regulations.
25. Compliance unth regulations.—Full compliance with the regulations herein prescribed is essential to prompt payment of accounts and the compilation of
current and accurate information required under the Emergency Relief Appropriation Act of 1935, and Executive Order No. 7034.
H . MOROENTHAU, J r . ,

Secretary of the Treasury.

Approved:
FRANKLIN D . ROOSEVELT.

Exhibit 53
Executive Order No. 6981, March 2, 1935, removing, in certain cases, restrictions
imposed by Public Resolution 53, of June 27, 1934, as to payments, transfers^
and deliveries of property under the Trading with the Enemy Act and the
Settlement of War Claims Act of 1928
By virtue of and pursuant to the authority vested in me by Public Resolution 53. approved June 27, 1934 (48 Stat. 1267), the Trading with the Enemy
Act, approved October 6, 1917 (40 Stat. 411), as amended, and the Settlement

REPORT OP THE SECRETARY OF THE TREASURY

289

of War Claims Act of 1928, approved March 10, 1928 (45 Stat. 254), I do hereby
order as foUows:
SECTION 1. For the purposes of the said resolution, it is hereby determined
that Germany has been and is now in arrears in payments of principal and
interest under the debt-funding agreement between Germany and the United
States dated June 23. 1930. with respect to the obligations of Germany on
account of awards entered and to be entered by the Mixed Claims Commission,
United States and Germany. The period in which Germany is in arrears shall
be deemed to continue for the purposes of this order until it is determ.i!ned
by the President that such period has terminated.
SECTION 2. The restrictions imposed by the said resolution are hereby removed except as to the foUowing payments, conveyances, transfers, or deliveries of money or property or of the income, issues, profits, or avails
thereof:
1. To any person who was on April 6, 1917, or who at any time since that
date has been, a German national, unless such person is entitled to receive
payment under section 9, subsection (b) (1), of the Trading with the Enemy
Act, as amended, or unless such person is a national of the United States at
the time of payment, conveyance, transfer, or delivery, and was on June 1,
1934, the legal and beneficial owner of the claim to the money or property
or the income, issues, profits, or avails thereof, and on or before June 1, 1934,
the United States received written notice of such ownership.
2. To any person domiciled or resident within the territory of Germany,
except a natural person who is a national of the United States at the time of
payment, conveyance, transfer, or delivery.
3. To any corporation, association, or partnership, or other unincorporated
body of individual^ or a body politic which on or at any time since April 6,
1917, was organized or existed under the laws of Germany or had Its principal
place of business iri (Germany.
4. To any corporation, association, or partnership, or other unincorporated
body of individuals, or a body politic in which a substantial legal or beneficial
interest is owned directly or indirectly by any person to whom payment, conveyance, transfer, or delivery continues to be postponed under subdivision
1, 2, or 3 hereof, or to any person who is a trustee of such money or property for
a person to whom payment, conveyance, transfer, or delivery continues to be
postponed under subdivision 1, 2, or 3 hereof.
5. To the heirs, devisees, legatees, executors, administrators, representatives,
creditors, successors, or assigns of any person to whom payment, conveyance,
tranfer, or delivery continues to be postponed under subdivision 1, 2, 3, or
4 hereof, except to such heirs, devisees, or legatees as are natural persons
and have been nationals of the United States from June 1, 1934, to the time
of payment, conveyance, transfer, or delivery.
SECTION 3. For the purposes of this Executive order, (a) the nationality,
residence, domicile, or other qualification of claimants under the Trading
with the Enemy Act, as amended, shall be that determined by the Attorney
General; and (&) the nationality, residence, domicile, or other qualification
of claimants to money or property or the income, issues, profits, or avails
thereof, held in the German special deposit account, and in the Austrian and
Hungarian special deposit accounts, shall be that determined by the Secretary
of the Treasury.
FRANKLIN D . ROOSEVELT.
T H E WHITE HOUSE,

March 2, 1935.
Exhibit 54
Letter of the Acting Postmaster General to the Secretary of the Treasury, dated
November 26, 1935, certifying extraordinary expenditures contributing to the
deficiency of postal revenues for the fiscal year 1935, in pursuance of Public
Act No. 316, Sei>enty-first Congress, approved June 9, 1930 (40 Stat. 523)
WASHINGTON, D . C , November 26, 1935.
The honorable the SECRETARY OF THE TREASURY:

MY DEAR MR. SECRETARY: In accordance with the provisions of the act of
June 9, 1930, embodied in section 260, Postal Laws and Regulations, the amounts
set forth below with respect to certain mailings during the fiscal year ended

290

REPORT OF THE SECRETARY OP THE TREASURY

June 30, 1935, are certified to you in order that they may be separately classified
on the books of the Treasury Department in stating the expenditures made
from the appropriation to supply the deficiency of postal revenues:
(a) The estimated amount which would have been collected at regular rates
of postage on matter mailed during the year by oflicers of the Government (other than those of the Post Office Department) under
the penalty privilege, Including registry fees:
Eostage.
$28, 418, 484
Eegistry fees, including surcharges
2, 863,116
*
•
$31, 281, 600
(6) The estimated amount which would have been collected at regular
rates of postage on matter mailed during the year by:
1. Members of Congress under the franking privilege
$577,162
2. By others under the franking privilege
180
577,342
(c) The estiinated amount which would have been collected during the year
at regular rates of postage on publications going free in the county
• 575, 597
(d) The estimated amount which would have been collected at regular
rates of postage on matter mailed free to the blind during the year
131, 700
(e) The estimated difference between the postage revenue collected during
the year on mailings of newspapers and periodicals published by and
in the interests of religious, educational, scientific, philanthropic, agricultural, labor, and fraternal organizations, and that which would
have been collected at zone rates of postage
203, 434
(f) The estimated excess during the year of the cost of aircraft service
over the postage revenues derived from air mail
_
8, 474, 738
(flr) The estimated amount paid during the year to vessels of American
registry for carrying the ocean mail in excess of what would have
been paid at pound rates if carried in vessels of foreign registry
28, 292, 841
Total

"~69, 537, 252

Very truly yours,

W. W. HOWES,

Acting Postmaster General.

TABLES

291

EXPLANATION OF BASES USED IN TABLES
Figures in the following tables are shown on various bases, namely: (1) Daily
Treasury statements^ unrevised (current cash); (2) daily Treasury statements,
revised (actual); (3) warrants issued; (4) checks issued; and (5)- collections reported by collecting officers.
Daily Treasury statements (unrevised) (receipts and expenditures).—The
figures shown in the daily statenient of the United States Treasury are compiled
from the latest daily reports received by the Treasurer of the United States
from Treasury officers and public depositaries holding Government funds. The
daily Treasury statement, therefore, is a current report compiled from latest
available information, and, by reason of the promptness with which the information is obtained and made public, it has come into general use as reflecting
the financial operations of the Government covering a given period, and gives
an accurate idea of the actual condition of the Treasury as far as it is ascertainable
from day to day. This is known as ''current cash basis", according to daily
Treasury statements (unrevised). Table 3 (p. 316) shows receipts and expenditures on this basis. The current assets and liabilities of the Treasury and the
outstanding public debt are also available on this basis.
Daily Treasury statements (revised) (receipts and expenditures).—On account of the distance of some of the Treasury offices and depositaries from the
Treasury, it is obvious that the reports from all officers covering a particular
day's transactions cannot be received and assembled in the Treasury at one
time without delaying for several days the publication of the daily Treasury
statement. It is necessary, therefore, in order to exhibit the actual receipts and
expenditures for any given month or fiscal year, to take into consideration those
reports covering the transactions for the last few days of the month or fiscal year
concerned which have not been received in the Treasury until the succeeding
month or fiscal year, and to eliminate receipts and expenditures relating to the
preceding month. After taking into consideration these reports, the revised
figures indicate the condition of the Treasury on the basis of actual transactions
occurring during the period under review. This is known as '' the basis of daily
Treasury statements (revised).''
It is not practical to delay the publication of the daily Treasury statement in
order to include the later reports, as the difference between the revised and the
unrevised figures is inimaterial. The unrevised figures as shown in current
daily Treasury statements are the basis for the Budget estimates submitted
to Congress by the President. The revised figures are of no practical use except
to enable the use of a true General Fund balance on the monthly statement of
the public debt of the United States and to bring the daily Treasury statement
figures into agreement with the figures based on warrants issued. The table on
page 173 shows receipts and expenditures on this basis. The current assets and
liabilities of the Treasury and the outstanding public debt are also available on
this basis.
Warrants issued (receipts).—Section 305 of the Revised Statutes provides that
receipts for all moneys received by the Treasurer of the United States shaU be
endorsed upon warrants signed by the Secretary of the Treasury, without which
warrants, so signed, no acknowledgement for money received into the Public
Treasury shall be vahd. The issuance of warrants by the Secretary of the
Treasury, as provided by law, represents the formal covering of receipts into
the Treasury.
Certificates of deposit covering actual deposits in Treasury offices and depositaries, upon which covering warrants are based, cannot reach the Treasury
simultaneously, and for that reason all receipts for a fiscal year cannot be covered
into the Treasury by warrants of the Secretary immediately upon the close
of that fiscal year. It is necessary to have aU certificates of deposit before a
statement can be issued showing the total receipts for a particular fiscal year
on a warrant basis. The figures thus compiled wUl agree with the figures compUed on the basis of daily Treasury statements (revised). The details in table
1 (p. 296) show receipts on this basis.
293

294 '

REPORT OF THE SECRETARY OF THE TREASURY

Warrants issued (expenditures).—The Constitution of the United States provides that no money shaU be drawn from the Treasury but in consequence of
appropriations made by law. Section 305 of the Revised Statutes requires that
the Treasurer of the United States shall disburse the moneys of the United
States upon warrants drawn by the Secretary of the Treasury. As the warrants,
are issued by the Secretary they are charged against the appropriate appropriations provided by law. Some of these warrants do not represent actual payments to claimants, but are merely advances of funds to be placed to the credit
of disbursing officers of the Government with the Treasurer of the United States
for the payment of Government obligations. The disbursing officer then issues
his check on the Treasurer in payment of such obligations. As far as the appropriation accounts are concerned, the warrants issued and charged thereto constitute expenditures, but it will be observed that such expenditures necessarily include unexpended balances to the credit of the disbursing officers. Under normal conditions these balances over a period of several years fluctuate very little
in the aggregate, and the difference between the total expenditures on a warrant
basis and a cash basis (revised) is immaterial. Statement of the expenditures on
a warrant basis from 1789 to 1915 is shown on page 324 of this report.
Checks issued (expenditures).—This basis, more than any other, reflects the
real expenditures of the Government. Expenditures for a given fiscal year on
the basis of checks issued differ from the corresponding figures on the basis of
warrants in that the former include expenditures made by disbursing officers
from credits granted during the previous fiscal year, and exclude the amount of
unexpended grants remaining to' their credit at the end of the fiscal year. The
basis of checks issued differs from the basis of the daily Treasury statement (revised) in that the former includes checks outstanding at the end of the fiscal
year, and excludes unpaid checks outstanding at the beginning of the fiscal year.
A detailed explanation of the basis of checks issued will be found on page 89 of
the. Secretary's report for 1927. Table 2 (p. 302) shows expenditures on this
basis.
Collections reported by 'collecting officers (receipts).—Statements showing
receipts on a collection basis are compiled from.reports received by the various
administrative offices from collecting officers in the field, such as collectors of
internal revenue and collectors of customs. These reports cover the collections
actually made by these officers during the period specified. The collections are
then deposited in a designated Government depositary to the credit of the
Treasurer of the United States, which depositary renders a report to the Treasurer. The reports of the collecting officers and the depositaries do not, of course,
coincide, for the reason that the collecting officers make collections during the
last few days of the fiscal year which are not deposited until after the close of the
fiscal year. On this account the two reports do not agree. The receipts are
reported on a collection basis merely for statistical purposes and to furnish information as to detailed sources of revenue. Classification of such items on the
basis of deposits has been found to be impracticable and uneconomical. Tables
7^and 13 (pp. 341 and 355) show receipts on a collection basis.
DESCRIPTION OF ACCOUNTS THROUGH WHICH TREASURY
OPERATIONS ARE EFFECTED
All receipts of the Government are covered into the General Fund of the Treasury from which all expenditures are made. Receipts and expenditures, however,
are classified in the Treasury's records according to the class of accounts through
which operations are effected. Transactions are segregated in order to exhibit
separately those effected through general fund accounts, as contrasted with those
effected through special and trust accounts representing restricted or specially
allocated receipts and expenditures chargeable thereto. This classification was
first shqwn in published records for 1927 for the warrants and checks-issued
bases and on the daily Treasury statements beginning with the July 1, 1930,
issue, in order to conform to the practice .of the Bureau of the Budget. In some
tables in this report, however, transactions in the three types of accounts are
combined for purposes of historical comparison. A brief general explanation of
the three classes of accounts is presented below.
General fund accounts.—The principal sources of general fund account receipts
are income taxes, miscellaneous internal revenue, and customs duties. In
addition, a large number of miscellaneous receipts come under this head including
such items as proceeds of Government owned securities (except those which are
applicable to public debt retirement), sale of surplus and condemned property,

REPORT OP THE SECRETARY OF THE TEEASURY

295

Panama Canal tolls, fees (including consular and passport fees), fines, penalties,
forfeitures, rentals, royalties, reimbursements, immigration head tax, sale of
public land, tax on national bank Circulation, interest on public deposits, seigniorage on coinage of subsidiary silver and minor coins, etc. Moneys represented in
the general fund accounts may be withdrawn from the Treasury only in pursuance
of appropriations made by Congress. There are four classes of appropriations
payable through the general fund accounts of the Treasury, namely: (a) Annual, being those made each year in the several departmental supply bills and
limited for obligation during the fiscal year for which made; (b) continuing
(no year), being available until expended or until the object for which appropriated has been accomplished, such as construction of public works; (c) permanent-specific, being fixed amounts provided for each of a series of years by permanent legislation, without annual action of Congress; and (d) permanent-indefinite,
being indefinite amounts (so much as may be necessary) provided by permanent
legislation without annual action of Congress, such as the indefinite appropriation
to cover interest on the public debt.
A statement of general fund receipts and expenditures is, therefore, in the
nature of a general operating statement, and gives a picture of the relationship
between the general revenues of the Government and the operating expenditures
(including capital outlays and fixed charges) chargeable against them.
Special accounts.^Special account receipts may be generally defined as funds
received under special authorizations of law which may be expended only for
the particular purposes specified therein. Special account receipts may not be
used for the general expenditures of the Government. The most important
items of receipts included under this heading, from the standpoint of amounts,
are those applicable to the retirement of the public debt. Other important
special account receipts are the reclamation fund under the Department of the
Interior, funds received for river and harbor improvements. Forest Service
cooperative funds, and proceeds from sales of ships, etc., by the United States
Shipping Board available for construction loans. There are many other special
account receipts of lesser importance.
Trust accounts.—Trust account receipts represent moneys received by the
-Government for the| benefit of individuals or classes of individuals. Moneys
held in trust, being payable to or for the use of beneficiaries only, are not available
for general expenditures of the Government. There are several classes of trust
account receipts, the beneficiaries under which may be either individuals or
groups of individuals. The funds may represent (a) moneys received directly
from or for account of individuals, as in the case of moneys received from foreign
.governments or other sources in trust for citizens of the United States or others
under the act of Feliruary 27, 1896; (b) moneys collected as revenues and held
in trust, such as the proceeds of sales of Indian lands which are held as interest^bearing funds for the benefit of Indian tribes; and (c) proceeds of grants from the
general fund accounts of the Treasury in pursuance of treaty or other obligations
such as the perpetual trust fund created for the Ute Indians under section 5 of
the act of June 15, 1880.

296

REPORT OF THE SECRETARY OP THE TEEASURY
RECEIPTS AND EXPENDITURES
General tables

TABLE 1.-

-Details of receipts, by sources and accounts, for the fiscal year 1935

[Details on basis of warrants Issued with totals adjusted to basis of daily Treasury statements (unrevised),
see p. 293. For explanation of accounts, see p. 294.]
Trust and conGeneral and
special accounts tributed accounts

Source
REVENUE

Internal revenue:
Income tax
Miscellaneous internal revenue

$1,099,230,382 70
1, 658, 796, 527 21
517, 796,894 01

- .-

Prop.p.s.'SiinP' t.aY nn farm nrndnp.ts

3, 275,823,803 92
1,866,223 90

Total internal revenue, warrants-issued basis
Adjustment between warrants issued and cash receipts
Total internal revenue, cash riBceipts . ,
-.
Customs:
Customs duties,
warrants-issued
basisand cash receipts.
Adjustment
between
warrants issued
Total customs duties, cash receipts
Miscellaneous:
Miscellaneous taxes:
Tax on circulation of national banks
Tonnage tax
.
Immigration head tax
Taxes, licenses, fimes, etc., Canal Zone

. 3, 277,690,027 82

343, 353,033 56

Total miscellaneous taxes
Interest, exchange, and dividends:
Interest on
or payments under fundmg
Interest
on deferred
bonds ofcollections
foreign governments
agreements
-Interest on obligations of Reconstruction Fmance Corporation
_ _ .
Interest on loans, Puerto Eican Hurricane Rehef Commission
_
--Interest on loans to States, municipalities, etc., Public
Works Administration
..
Interest on loans, Housing Corporation, Department of
Labor
, _ *__
. _ .
'
Interest on homestead loans, Virgin Islands
—..
Interest on farmers* seed loans .
Interest on Liberty bond Issues fund, Naval Establishment.
Interest on public depositsInterest on money loaned from construction loan funds
(U. S. Shipping Board Bureau)
Interest on miscellaneous obligations
Discount on Treasury obligations redeemed and purchased.
Gain by exchange
Dividends on capital stock of Federal home loan banks _ .
Dividends on capital stock of the Panama R. E. owned by
the United States
Dividends on shares of Federal savings and loan associations.
Earnings of War Finance Corporation
Military and naval insurance, Veterans' Administration
(repayments to appropriations)
..Federal control of transportation systems (repayments to
appropriations)
Loans to railroads after termination of Federaf control
(repayments to appropriations)
Total interest, exchange, and dividends
Fines and penalties:
Judicial
Internal Eevenue
Customs Service
Immigration Service
Enforcement of National Prohibition Act (Judicial)
Navigation
_
._
„
Liquidated damages
Naval fines and forfeitures
..
-Recovery of value of oil in case of United States against Pan
American Petroleum Co
.
Other
Total fines and penalties

For footnotes, see p. 302.

344, 292, 669 75
9S9,6S6 19

4,365,601 32
1,433, 521 86
796,967 00
71,844 72
6,667,934 90
51, 518 85
599, 681 47
23,942,120 02
3,379 00
1,616,288 94
16,104 75
2,130 76
265,189 25
44, 625 97
160,437 96
2,915,931 18
86,240 95
59 51
26,678 99
1,591,472 67
350,000 00
76,808 28
100,000 00
i 596,182 70
1 17,774 36
1 334,387.81
32, 797,013.42
399,155.81
21,397. 77
311,507.99
48,420. 79
73,929. 75
34, 735. 39
254,660.87
(2)

5, 500,000. 00
14,406.18
6, 658, 214. 55

EEPOET OF THE SECRETARY OF THE TREASURY

297

TABLE 1.—Details of receipts, by sources and accounts, for ihe fiscal year 1935—-Con.
Source

General and
Trust and conspecial accounts tributed accounts

EEVENUE—continued
Miiscel laneous— C ontinued.
Fees:
Agricultural Commodities Act
Alaska game laws.
Clerks, United States courts
Board of Tax Appeals
_
Commissions on telephone pay stations in Federal buildings
and rented post offices
,
Credit union
Consular and passport.
Court of Customs and Patent Appeals
Court of Claims...
Copying
Copyright
i
Immigration (registration)
Indian lands and timber
Land offices (including commissions)
Marshals, United States courts
Migratory-bird hunting stamps
Naturalization,....
Naval stores grading
Navigation
i
Patent
^
Purchase of discharges, Navy and Marine Corps
Eeglstratlon, Securities Act
Testing
I
Warehouse A c t . . . . . .
Water and power right
Other
:
Total feesForfeitures:
Bonds of aliens, contractors, etc
Bribes to United States officers
Customs Service...
Judicial, miscellaneous
Under enforcement of National Prohibition Act (Judicial)..
Unclaimed moneys and wages remaining in registry of courts.
Unclaimed merchandise.Unclaimed funds.
Unexplained balances in cash accounts
Other
Total forfeituresAssessments:
Colorado Elver Dam fund, Boulder Canyon project
Deposits for establishing wool standards
Deposits, public survey work, Alaska
Deposits, public survey work, general
On Federal and joint stock land banks, and Federal Intermediate credit banks for expenses of examinations, Farm
Credit Administration
On Federal home loan banks for salaries and expenses, Federal Home Loan Bank Board
On railroads for expenses of Federal Coordinator of Transportation
German Government's moiety, expenses, Mixed Claims
Comniission....
Furlough and compensation deductions and vacancy savings (special deposit accounts)
Immigration Service overtime
Naval hospital fund
Total assessments..
Reimbursements:
Construction charges (Indian Service)
Collections under Grain Standards Act
Collections under Cotton Standards Act
By District of Columbia for advances for acquisition of lands
under sec. 4, act May 29, 1930, as amended
Maintenance of District of Columbia inmates in Federal
penal and correctional institutions
Refunds on empty containers
Expenses, miscellaneous
By contractors for excess cost over contract price
For^footnotes, see p. 302.

$68,975.16
11,554.79
1,778,283. 56
38.065.85
67, 756.32
10, 245.00
3,408, 657.26
382.05
613.05
37, 928.04
259, 907.90
91, 870.00
87, 292.17
198, 481.12
171, 151.19
466,879.00
1,168, 507.91
9,932. 75
179, 173. 25
4,077,883.08
3,208.13
106,408.21
69, 368.33
19, 780.50
11, 318.24
407.18
12,354,030.03
646,369.23
1,579.04
902,544. 38
33,201.31
81,717.69
183,510.89
75,631.06
, 2,637.40
209.01
20, 674. 63
1,947,074.64
•>9.5,518.93
25, 223. 00
(2)
(2)

465,138.07
247,929.10
526,146.30
1,048.69
8 3,980. 65
68,710.01
(2)

1,433,694. 65
15, 762. 25
51,196. 32
68, 286.05
531, 211.94
122, 079. 68
11, 509. 70
27,256.94
155, 305.99

298

EEPOET OP THE SECRETARY OP THE TREASURY

TABLE 1.—Details of receipts, by sources and accounts, for the fiscal year 1935—Con!.
General and
Trust and conspecial accounts tributed accounts

Source
REVENUE—continued
Miscellaneous—C ontinued.
Reimbursements—Continued.
Expenses of redeeming national currency
. ' Inspection of food and farm products .
Gasoline State tax
'
Government property lost or damaged
.
Hospitalization charges and expenses—
Expenses of International service of ice observations and
patrol
.
--Under Federal Hunting Stamp Act
Costs from estates of deceased Indians
Maintenance, operation, and Irrigation charges, irrigation
systems, Indian Service..
Of appropriations made for Indian tribes
Reclamation fund, collections
Auxiliary reclamation fund, Yuma project, Arizona
Settlement of claims against various depositors —
Other
Total reimbursements

Total gifts and contributions

. 1

Total sales of Government property—products -

- .

Salesof services:
Alaska Railroad fund receipts.
Earnings by United States transports
Earnings from business operations
'
Fumigating and disinfecting
.
Laundry and dry-cleaning operations.
..
Livestock breeding service.
Overhead charges on sales of services or supplies (War and
Navy)
:.
Profits from sale of ships'stores. Navy
Quarantine charges (Including fumigation, disinfection, inspection, etc., of vessels)
. _
_Quarters, subsistence, and laundry service
i
Radio service
Storage and other charges .
Telephone and telegraph
Tolls and profits, Panama Canal —
_ .
Work done for Individuals, corporations et al
Other
. .
. .

94,62L60
160,000.00
31,833.73
620,016. 32
167,843. 77
2,195,112.87
20,793.38
6,234.08
85, 527.11

4,439.28
3, 652.18
3,437. 50
174.97
1,698. 34
100,000.00
113,302.27

Sales of Government property—products:
Scrap and salvaged materials, condemned stores, waste
paper, refuse, etc
.
Agricultural products, including hvestock. and livestock
.. .
products __ . . .
.
Card indexes. Library of Congress
Dairy products
_
.
Electric current, power plant, Coolidge Dam, Ariz
Electric current
Gas from helium plants,. . . . .
.
Heat, light, and power Z...i
Ice
. .
Occupational therapy products
_._
Photo duplications
Public documents, charts, maps, etc
Seal and fox skins, and furs
Subsistence (meals, rations, etc.)
Water
Other

Total sales of services...

6,620,609.79

Gifts and contributions:
Donations to the United States
Moneys received from known and unknown persons
Eeturn of part of compensation of the President
Returnof salary paid to Members of Congress
Return of salary from constitutional officers
By New York Liberty Loan Association

$463,902.38
308,738.68
603.08
627,474.38
. 66,199.64

1, 067,223. 63
44,423.26
207.637.90
43,186.19
6, 743. 53
62,439.79
29,186.71
135,206.39
66,597.37
64,354.26
7,424. 32
447.421.91
108,447.05
60,283. 03
45,907. 24
27,285.12
2,392,766.70

" • "

1,500,077.71
57, 546.19
25,892. 51
27, 032.00
924,255.63
148.30
87,369.10
(2)

224,716. 91
39,792.13
44,225. 00
164, 073.81
313, 649.65
24, 020,108.25
21,693.81
17,407.18
27,467,888.08
„.n ..

For footnotes, see p. 302.

REPORT OP THE SECRETARY OP THE TREASURY

299

TABLE T.—Details of receipts, by sources and accounts, for the fiscal year 1935—Con.
General and
Trust and conspecial accounts tributed accounts

Source
REVENUE—continued
Miscellaneous—Continued.
Bents and royalties:
Rent of public buildings, grounds, etc
Rentofland
.
.
Receipts under mineral leasing acts
Royalties on oil, gas, etc
..
Annette Islands reserve, leases, Alaska
Rent of equipment'
..
.
Rent of telegraph and telephone facilities
Rent of water-power sites..
Pipe line rentals
Rent of docks, wharves, and piers
Other
J
Total rents and royalties

. .

$231,829.00
114,500.49
3,926,372.44
639,383.32
36,385,23
83,046. 28
18,493. 69
75,448.45
16,000.00
17,256.06
1,916.63

...,
..

6,159, 631. 69

• "

Permits, privileges, and licenses:
Alaska fund
1
Business concessions
Game, bird, and wildlife refuges
Immigration permits
Licenses under Federal water power act - — - .
Permits to enter national parks
Pipe-line water and power-transmission rights
Other

—
—

1,826,538. 54

Total permits, privilege,?, and licenses
Mint receipts:
'
Profits on coinage, bullion deposits, etc
Seigniorage

4,139,327.18
68,163,161.60

62,292,478. 78

Total mint receipts
Forest reserve fund

257, 305. 69
181,648.06
3,406. 09
178,122.84
570, 504. 66
619, 697. 21
15,643.00
411.00

3,361,028. 24

263,674. 01

Deposits, postal funds. Canal Zone

78,627.46

United States share ofDistrlct of Columbia receipts

170,434,307.65

Total miscellaneous revenue receipts

3,790,550,68L 32

Total revenue receipts, warrants—issued basis
NONREVENUE

Miscellaneons—Realization upon assets:
Repayments of investments:
Federal control of transportation systems (repayments to
appropriations)
Loans to railroads after termination of Federal control, etc.
(repayments to appropriations)
Repayment of principal on account of loans to railroads, Public Works Administration.- . .
Repayment of principal on account of loans to States, municipalities, etc.. Public Works Administration
Principal of bonds of foreign governments under funding
agreements . . .
.
. .
Principal of Government-owned securities, sale of war supplies
.
. . . ..
Principal payments on low-cost houses. Virgin Islands
Principal payments on loans, Puerto Rico Hurricane Relief
Commission
Return of advances made to reclamation fund . .
Construction costs of public works in Colon and Panama. ._
Other . —
Total repayments of investments
Sales of public lands

_. .

-- ..-

Sales'of Govermnent property:
Capital equipment, includes trucks, horses, cars, machinery,
furniture, and fixtures, and other capital equipment
Land and buildings
Lands, etc., on account of military-post construction fund__
Office material, etc. (Procurement Division)
....
.For footnotes, see p. 302.

133,600.00
16,485,284.98
83,000.00
624,626.95
66,709.53
66,968.20
17.00
4,686.67

(«)

66,386.58
124.86

7,320,403. 67
86,757.46
$160,063.23
1, 253,010.98
1,062,212.04
9,789.38

(4)

300

REPORT OP THE SECRETARY OP THE TEEASUEY

TABLE 1.—Details of receipts, by sources and accounts, for the fiscal year 1935—Con.
Source

Trust-and con- ..
General and
special accounts tributed accounts

NONREVENUE—continued
Miscellaneous—Realization upon assets—Continued.
Sales of Government property—Continued.
Proceeds of sales, building or purchase of vessels for the Coast
Guard
-..
Proceeds of sales, rebuilding and improving Coast Guard
stations
Coos Bay wagon-road grant fund
Oregon and Cahfornia land-grant fund
..Ordnance material (war)
_.
.:..
War supplies
Other
Total sales of Government property..
Miscellaneous:
Trust accounts:
*
Government life Insurance fund
Adjusted service certificate fund:
Interest on investments
Interest on loans
Canal Zone retirement fund:
Contributions
Interest on Investments
Civil service retirement fund:
Contributions.
Interest on investments
Foreign service retirement fund:
Contributions,—.--—
Interest on investments
—
Interest earned on Investments, mutual mortgage Insurance
fund--Deposits of unclaimed moneys of former patients, Veterans'
Adniinistration hospitals
Deposits, general post funds, national homes, Veterans'
Administration
Deposits, funds due incompetent beneficiaries. Veterans'
Administration
Deposits, personal funds of patients,' Veterans' Administration
Relief and rehabilitation, and Interest on investments.
Employees' Compensation Commission
—
Deposits of miscellaneous contributed funds. Department
of Agriculture.---Deposits of collections. United States marshals—
Deposits of collections, clerks of United States district courts.
Advances, fox and fur seal industries, Pribilof Islands
Deposits of commissary funds. Federal prisons
-.
Deposits of funds of Federal prisoners
Pension money, St. Elizabeths Hospital
Personal funds of patients, St. Elizabeths Hospital
Deposits, publicsurvey work, Alaska 2 —
Deposits, pubhc survey work, general 2___
Naval fines and forfeitures 2
Naval hospital fiind 2
Profit from sale of ships* stores, Navy 2
:
Pay of the Navy, deposit fund
Pay ofthe Marine Corps, deposit fund
Proceeds, civic fund, naval reservation, Olangapo
----Settlement of claims. Special Claims Commission under actj
2 of convention, April 24,1934, between the United States
• and Mexico
=
.
Internal Revenue, Puerto Rico collections 2
:
_-.
Internal Eevenue, coconut oil tax, Philippine Islands 2
Internal Revenue, Philippine Islands, collections 2
Additional Income tax on railroads in Alaska 2___.
Customs duties, Philippine Islands 2
Tonnage tax, Philippine Islands 2...
Processing taxes, miscellaneous: 2
American Samoa
,-Canal Zone-—
Island of Guam
Philippine Islands-.Virgin Islands
-..
1
•
Processing taxes, sugar: 2
Territory of Hawaii
Philippine Islands.--...-'
Puerto RicoVirgin Islands
.----For footnotes, see p. 302.

$43,991.89
6,007.48

23,726.61
323,634.07

38,647.69
85,637.78
8,688. 52
3,014,308. 57
$69,767,32L91
5,711,035.65
137,162.72
459,198.59
91,031.23
30,089,204.72
10,822,890.96
179,138.00
107.083.29
262,114.75
7,659.69
114,669.74
37,266.18
2,149,257.23
26,323.09
16,148, 296.09
47, 703.01
1,376, 034.84
40, 911.90
' 266, 699. 61
547, 111.78
2.00
•142, 300.91
1, 140.00
5, 826.19
204, 746.76
401, 916.82
209, 676.24
33, 218.47
73, 829. 60
12, 968. 61
500,000.00
24,647.34
17.142,472.20
474,269.69
2,873.76
2,492.39
14, 706.42
2.41
21,199. 68
60.00
406,627. 51
60.22
515,021.46
6,765,332.57
7,724.022.90
43,615. 70

REPOET OF THE SECRETARY OP THE TREASURY

301

TABLE 1.—Details of receipts, by sources and accounts, for the fiscal year 1935—Con; •
General and
T r u s t a n d conspecial accounts t r i b u t e d a c c o u n t s

Source

:
NONREVENUE—continued
Miscellaneous—Continued.
Trust accounts—Continued.
Pay of the Army, deposit fund
Soldiers'Home permanent fund.
,
Proceeds from estates of deceased soldiers
Civilian Conservation Corps, withheld cash allowances
Indian moneys:
:
Proceeds of labor, act June 13,1930-.
- . Proceeds of labor, agencies schools, etc
-Oil and gas leases) etc., Osage Reservation, Okla
Proceeds of sales and leases of Indian lands, etc
Deposits of individual Indian moneys
Miscellaneous (Indians)
Deposits of unclaimed moneys of individuals whose whereabouts are unknown
Other trust funds
Total trust accounts

$847,762.99
279,492.14
39,036. 66
1,662, 622.62
989 696 98
228,254.30
4,818,837.40
659 258.46
69.78
119 47
9,360.76
53,704.20

. . .

182 689 247 08

Contributed accounts:
Forest Service cooperative work
._ .
Collections, distilled spirits industry parity payments
Railroad retirement fiind:
Carriers' contributions
Employees' contributions
Library of Congress gift fund
Library of Congress trust fund. Investment account
_
Interest on Library of Congress trust fund, investment account
Contributions and mterest on investments, National Institute of Health, conditional gift fund
Interest on endowment fund, preservation of birthplace of
Abraham Lincoln..
.
Contributions, National Capital Park and Planning Commission
_.Receipts, Welfare and Recreational Association, of public
buildings and grounds
Contributions to reclamation fund .
._ . .
.. _
Donations, National Park Service.
Donations for purchase of lands. National Park Service .
Contributions for roads, bridges, and related works, Alaska. _
Contributions for river and harbor improvements
Contributions for flood control
Contributions for sewerage system, etc., Fort Monroe, Va
Other
Total contributed accounts

701,124.22
763,604.16
138,411.89
2,370.15
82,147.92
1 966 26
34,640.13
24,682.81
2,070.00
50,000; 00
1,076,792.62
469,000.00
604,961.24
84,324. 46
57,936. 45
2, 521,044.09
185,645.85
9,105 59
1,000.00

6,710,827.71

Total, trust and contributed accounts, exclusive of the
District of Columbia
District of Columbia:
Revenue receipts:
District of Columbia share United States share
Nonrevenue receipts:
Di5?trict of Cnliimbift share „
Total District of Columbia receipts

.'.

15,786,035.02
7 47, 958, 619.16

Total miscellaneous revenue and nonrevenue receipts,
including Panama Canal and sales of public lands,
warrants-issued basis
- - .
. _
Adjustment to basis of daily Treasury statements (unrevised)
!
Total miscellaneous revenue and nonrevenue receipts,
including Panama Canal and sales of pubhc lands,
cash basis..

For footnotes, see p. 302.

32,172,584.13

(«)

Total nonrevenue receipts
Total miscellaneous revenue receipts-

Total receipts, warrants-issued basis:
Revenue receipts
Nonrevenue receipts

189,400,074.79

$10,421,469.70
170,434,307. 65

237,358,693. 94

180,865,777.35

237,358,693.94

1,431,686.77

7,698,459.69

179,424,140. 58

229, 660,234.35

3,790,550,681.32
10,421,469. 70

237,358, 693. 94

3,800,972,151.02

237,358,693.94

302

EEPOET OF THE SECEETAEY OF THE TREASURY

TABLE 1.—Details of receipts, by sources and accounts, for thefiscalyear 1935—Con.
Trust and conGeneral and
special accounts tributed accounts

Source
NONREVENUE—continued
Miscellaneous—C ontlnued.
Increment resulting from reduction in the weight of the gold
dollar
.
_
Seigniorages

$1,722,761.97
140, 111, 441.47

$3,800,972,151.02
Total receipts, warrants-issued basis
604,949.06
Adjustment to basis of daily Treasury statements (unrevised)
Total receipts on basis of daily Treasury statements (unrevised)
3,800,467,201.96

379,192,887.38
7,683,191.93
371,509,696.46

1 Items of this character represent cash receipts credited to appropriation.
2 Stated as trust account under "Permanent Appropriation Eepeal Act, 1934", (48 Stat. 1224).
8 In addition to this amount, $11,211,997.92 was carried to the surplus fund of the Treasury as Impounded
salary savings and $11,093,053.67 reserved for impounded salary savings during the fiscal year 1935, under
the provisions of the Economy Act of June 30, 1932 (47 Stat., 403, sees. 110 and 203, as amended by sees. ^
4(a) and 8 of title II, act of Mar. 20,1933, and sec. 25 of title II, act of Mar. 28,1934). There were no impounded
salary savings or reserve for impounded salary savings for the Postal Service during the fiscal year 1935.
* Receipts of $12,904.89 included in miscellaneous trust accounts.
fi The act of Apr. 1, 1932 (47 Stat., 78), and sec. 12 of the act of Mar. 3, 1933 (47 Stat., 1427), suspended
reimbursement of $1,000,000 annually to the General Fund of the Treasury until July 1,1936.
fl The item of $78,627.46 United States revenue is shown under revenue receipts, p. 299.
7 Exclusive of $78,627.46 United States revenue from District of Columbia sources.
8 Represents seigniorage resulting from the issuance of silver certificates equal to.the cost of the silver acquired under the Silver Purchase Act of 1934 and the amount returned for the silver received under the
President's proclamation dated Aug. 9,1934.
NOTE.—Excess credits and adjustments in Italics to be deducted.

TABLE 2.—Details of expenditures, by organization units and accounts, for the fiscal
year 1935
[Details on basis of checks issued, totals adjusted to daily Treasury statements (unrevised), see p. 293*
For explanation of accounts, see p. 294]

General and
special
accounts

Organization unit

Emergency
accounts

Total, general,
special, and
emergency
accounts

Trust and
contributed
accounts

LEGISLATIVE

U. S. Senate
House of Representatives
Legisi*itlve, miscellaneous.
Architect ofthe Capitol
Botanic Garden
Library of Congress
Government Printing Office

Total legislative, checksIssued basis
Adjustment between checks issued
and cash expenditures
Total, legislative, cash basis..

$3,278,758.84
8,072,788.84
4,000.00
3, 233,444. 69
98,052. 22
2,196,278.77
2,900,066.48

$488,366. 53

$3, 278,758.84
8,072.788.84
4,000.00
3,721,811.22
98,052.22
2,196,278.77
2,900,066.48

19,783,379.84

488,366.63

20,271,746.37

169,662.89

2,263.4S

161,916.32

19,623,726.96

486,103.10

20,109,830.05

E X E C U T I V E OFFICE

Executive Office, checks-issued
basis
Adjustment between checks issued
and cash expenditures
Total, Executive Office, cash
basis
- ..
For footnotes, see p. 315.

448,685.69

448.585.69

9,108.18

457,693. 77

457,693.77

$119,825.23

303

REPOBT OF T H E SECEETAEY OF T H E TEEASUEY

T A B L E 2.—Details of expenditures, by organization units and accounts, for the fiscal
,
year 1935—Continued

Organization unit

General and
special
accounts

Emergency
accounts

T o t a l , general,
special, a n d
emergency
accounts

Trust and
contributed
accounts

I N D E P E N D E N T OFFICES

Alien Property Custodian
American
Battle
Monuments
Commission
.. ,
Aviation Commission
Board of Mediation. .
Board of Tax Appelas
Central Statistical Board.- . : . . . .
Chicago World's Fair Centennial
Celebration
Civil Service Commission
California Pacific International Exposition
Electric llome and Farm Authority, Inc
Employees' Compensation Commission
Executive Council.
-^
Federal Alcohol Control Administration
L
Federal Communications Commission
•
Federal Coordinator of Transportation
Federal Deposit Insurance Corporation
'Federal Farm Mortgage Corporation
Federal Hom'e Loan Bank Board..
Federal Housing Administration...
Federal Power Commission-L
Federal Radio Commission..'.
Federal Reserve Board.
<
Federal Savings and Loan Associations.
.Federal Surplus Relief Corporation.
Federal Trade Commission..
General Accounting Office
Home Owners' Loan CorporationInterstate Commerce Commission..
National Advisory Committee for
Aeronautics
National Archives
National Banking Emergency Act..
National Capital Park and Planning Commission National Emergency Council
National Labor Board
1.
National Mediation Board-.^
National Resources Board-...Office of Special Advisor to the
President on Foreign Trade
Petroleum Administration
Prison Industries Fund
1
Puerto Rican Hurricane Relief
Commission—
L... _
Railroad Administration and Trans portation Act
1
Railroad Retirement Board
Securities and Exchange Commission
_
Smithsonian Institution
U. S. Supreme Court Building
('building) .
U. S. Tariff Commission
War Finance Corporation _
Welfare and Recreational Association of Public Buildings and
Grounds
Miscellaneous commissions, boards,
etc.:
District of Columbia-Virginia
Boundary Commission
George Washington Bicentennial
Commission
Operations under Mineral Act of
Oct. 5, 1918-..
Special deposit accounts.u

For footnotes, see p. 315.
16816—36
21

(')

(2)

$237, 798. 08
51,886. 21

$237, 798.08
51,886. 21

(3)

520, 688. 39

520, 688. 39
197, 762.12
1,893,443. 47

197, 762.12
1,893,443.47

131, 086.40

131,086.40
$741, 678.14

4, 530,363. 71
13, 918. 94
370. 454. 35
1,073,912.07
523, 307. 79

164,774.05

328.852. 04

(^)

741,678.14
1, 530,3G3. 71
13, 918. 94

9,104. 39

370, 454. 35
1, 073, 912. 07

8,029. SO
4, 083. 86
309, 336. 23

$5,181. 08

(')

l i ; 532.11

688, 081.84
8, 029. SO

314, 280. 71

(«)

535, 859. 37

4,083. 86
623, 616. 94
864,711.41
S4.40

34.40
(8)

1, 470, 747. 11
4, 680, 666. G5
11,599.85
5, 567, 483. 02
794, 771. 79
33, 282.46
84, 438. 62

(«)
52, 233. 44
361, 860.82

1, 522, 980. 55
5, 042, 527.47
11,599.85
5, 567, 483. 02

964.17
29, 348. 03
4 201 75
30, 000. 00

1,145, 725. 40
33, 282. 46
84, 438. 62

133. 50

11, 212. 35

955, 617. 00

254, 637.. 18
889, 295. 52
4, 779. 04
223,137. 57
955, 617.00

294, 533. 54

350, 953. 61

254, 637.18
889, 295. 52
4, 779. 04
223,137. 57

(10)

150,955. 78

150, 955. 78

CO
53, 715.14

53,715.14

126, 466.16
1,406, 478. 22
650,860. 26

1, 406,478. 22
650,860.26
1,803,951.77
871,984.75
23, 838. 51
161,108. 78

„..

134,145.86

1,803, 951. 77
871, 984. 75
23, 838. 5i
161,108. 78

15, 291.17

34, 217. 08

65, 078. 67

839, 919. 78

S7. 519. 5S

304

EEPOET OF T H E SECEETAEY OF T H E TEEASUEY

T A B L E 2.—Details of expenditures, by organization units and accounts, for the fiscal
year 1935—Continued
General and
special
accounts

Emergency
accounts

Total, general,
special, and
emergency
accounts

$28,073,656.61

$5,050,238.53

$33,123,895.14

1,399,421.96

659,273.14

840,148.82

Total of the above Independent offices, cash basis

29,473, 078. 57

4,490,965.39

33,964,043.96

Civil service retirement and disability fund 12 __
Canal Zone retirement fund 12

1 ^^' •

20,850,000. 00

40,744,030.20
574,043.10

Total, checks-issued basis

20,850, 000. 00

20,850, 000.00

41,318,073. 30

Total, cash basis

20,850,000.00

20,850, 000.00

76, 938, 830.16

76,938,830.16

Organization unit

Trust and
contributed
accounts

INDEPENDENT OFFICES—Continued
Miscellaneous commissions, boards,
etc.—Continued.
. Total of the above independent offices, exclusive of civil
service retirement fund, and
Canal Zone retirement fund,
checks-issued basis
Adjustment between checks issued and cash expenditures

Veterans' Administration:
Salaries and expensesAdjusted service and dependent
pay
Hospital and domiciliary facilities and services _
Military and naval compensation
Military and naval insurance
Printing and binding
-- National Industrial Eecovery
Veterans' Administration
Army and Navy pensions
Private relief acts
Miscellaneous items
Special deposit accounts
Total, Veterans' Administration, exclusive of adjusted
service certificate fund, civil
service retirement fund.
Canal Zone retirement
fund, and Government life
insurance fund, checks-issued basis
Adjustment between checks is
sued and cash expendituresTotal, Veterans' Administra
tion, exclusive of adjusted
service certificate fund
civil service retirement
fund. Canal Zone retirement fund, and Government life Insurance fund
cash basis
Adjusted service certificate fund
Civil service retirement and disability fund
Canal Zone retirement fundGovernment life insurance fund...

1, 361, 401.81

1,361,401.81

1, 344, 533. 77

1,344, 533. 77

602, 691.14
100, 783,300.42
. 128,800.90
373,804, 501.38
10,460.33
45,100.38
1,242,960.15

1,485,854.10

$884,107.38

602, 691.14
100, 783, 300.42
128,800.90
1, 485, 854.10
373,804, 501.38
10,460.33
45,100.38
1, 242,960.15

1,483,998.89
119,526. 65

1,364,473.24

556, 262, 580.44

1, 485,854.10

557, 748,434. 54

689,306.13

5,596.27

683,709.86

555,573,274.31
50,000,000.00

. 1,491,450. 37

557,064,724.68
50,000,000.00

(1)

6,407,299.68
(13)

(13)

. (13)

68, 766,042.15

Total, checks-Issued basis

50,000,000.00 1

50,000, 000. 00 1 75,173, 341.83

Total, cash basis.

50,000,000. 00

50, 000, 000. 00

Total, Veterans' Administration, cash basis
For footnotes, see p. 315.

605,573,274.31

1,491,450.37 1 607,064,724.68

0)
(0

305

BEPOET OF T H E SECBETABY OP T H E TEEASTJEY

T A B L E 2.—Details of expenditures, by organization units and accounts, for the fiscal
year 1935—Continued

• Oi*ganization unit

General and
special
accounts

Emergency
accounts

Total, general,
special, and
emergency
accounts

Trust and
contributed
accounts

INDEPENDENT OFFICES—Continued
Federal Emergency Administration
oj Public Works •
Administrative expenses—.
Loans and grants to States; municipalities, railroads, etc ;
Conversion of inhabited alleys fund.
District of Columbia
• Total, Federal Emergency
Administration of Public
Works, checks-issued basis.
Adjustment between checks issued
and cash expenditures.-...
._
Total, Federal Emergency
Administration of Public
Works, cash basis
--

$14, 701,466. 93

$14, 701,466^ 93

200, 720, 433. 54

200, 720,433. 54

61, 366.09

61, 366. 09

215,483,266.56

215, 483, 266. 56

3, 015, 906. 45

3, 015,906. 45

218,499,173. 01

Farm Credit Administration
Salaries and expenses
•. .
Agricultural marketing revolving
fund
--_
^•-Revolving fund (emergency account. Farm Credit Act)
. Farmers' crop production and
harvesting loans
Agricultural credits and. rehabilitation, emergency relief
Loans to farmers in storm, flood,
and drought-stricken areas
Loans- and relief in stricken agricultural areas (transfer to Farm
Credit Administration...! ' . Miscellaneous items
^^--.
Special deposit accounts :
Total, Farm Credit Admln. istration, checks-issued
basis
Adjustments between checks issued
and cash expenditures -.;.
Total, Farm Credit Administration, cash basis
..

$2,312,388,52

2, 312, 388. 52

5,921,067. 72

5,921, 067. 72 -

7, 500, 000. 00

7, 500, 000. 00
42,348,010.99

1,712,850.46

748,894.73

3, 740. 68
213, 982. 23

72, 394, 256. 08

Total, independent offices,
cash basis
...For footnotes, see p. 315.

72, 394, 256. 08
3, 740. 68
213.982. 23

• $1, 249,170 20
. 1, 249,170. 20

114, 742, 267. 07

128, 231, 701. 03

510, 372.96

2,915,088. 46

8,425,461.42

12,979,061. 00

111,827,178.61

124, 806, 239. 61

13.489,433.96

Miscellaneous
Commodity Credit Corporation
Emergency Conservation Work..^Export-lmport Banks of Washingr
tonFederal Civil Works Administration
--...
Federal Housing Administration
Federal Emergency Housing Corporation
Federal Emergency Relief Administration
Administration for Industrial Recovery •
1
Subsistence homesteads
Resettlement Administration
Rural Electrification Administration
..
Tennessee Valley Authority
Total miscellaneous, checksissued basis
Adjustment between checks issued and cash expenditures
Total miscellaneous, cash
basis

42, 348, 010. 99

(1)

•

426, 402. 70
H 346, 729, 552.17

5,991. 78

426,402. 70
346, 729, 552.17

2, 786. 41

11, 570,174. 29
999,841. 41

11, 576,166. 07
999,841. 41

8,846, 462.42

8,846,462.42

277,218.871

1,316,974,176.55 1, 316, 974,176. 55
12, 632,862. 30
4,113, 299. 65
2, 256, 304. 00

12,632,862.30
4,113, 299. 65
2, 256, 304. 00

30, 258.12
36, 541, 761. 82

5, 991, 78 1, 741,123, 881. 84 1, 741,129,873. 62
5,991,78

82, 641, 334. 20

277,218.87

82, 635, 342. 42

1,823, 765, 216. 04 1,823, 765, 216. 04

668,875,413.88 2,160,073,983. 42 2, 828,949, 397. 30

306

EEPOET OF T H E SECEETARY OF T H E TREASUEY

TABLE 2.—Details of expenditures, by organization units and accounts, for the fiscal
year 1935—Continued
General a n d
special
accounts

Organization u n i t

Emergency
accounts

T o t a l , general,
special, a n d
emergency
accounts

Trust and
contributed
accounts

D E P A R T M E N T OF AGRICULTURE

$608,827. 87
1,015,475.16

Office of t h e Secretary
L i b r a r y , D e p a r t m e n t of Agriculture
_ _ Office of E x p e r i m e n t Stations
E x t e n s i o n Service
C o o p e r a t i v e agricultural extension
work
Weather Bureau

$95, 696. 74

$704, 524. 61
1,015,475.15
90, 619. 97
4, 601,021. 01
867, 567. 78-

90, 619.97
4, 601,021.01
867, 567. 78
8, 579, 539. 70
3,187, 501. 53
5,871,837.00

90,136. 55
682,872. 08

8, 579, 539. 70
3, 277, 638.08
6, 554, 709.08

4, 972, 641.48
570,974.10
3, 609, 089.80
11,222,211.23

130, 376. 49
1,193, 453. 91
6,888, 588.44

4,972, 641. 48
701, 350. 59
4,802, 543. 71
18,110, 799. 67

M e a t Inspection, B u r e a u of AniB u r e a u of D a i r v I n d u s t r v
B u r e a u of P l a n t I n d u s t r y
. Fore^it Service
C o o p e r a t i v e work, Forest Service . .
P a y m e n t to States a n d Territories
froTTi liatinnal-fdrest'S fund
A c q u i s i t i o n of l a n d s for protection
of w a t e r s h e d s a n d s t r e a m s
B u r e a u of C h e m i s t r y a n d Soils
B u r e a u of E n t o m o l o g y a n d P l a n t
Quarantine
B u r e a u of Biological S u r v e y
B u r e a u of A g r i c u l t u r a l E c o n o m i c s . .
B u r e a u of Agricultural E n g i n e e r i n g B u r e a u of H o m e E c o n o m i c s
E n f o r c e m e n t of t h e Grain F u t u r e s
Act
Food and Drug Administration
A g r i c u l t u r e , miscellaneous
Snecial denosit accounts
Total, Agriculture, depart-.
m e n t a l , checks-issued basis .
A d j u s t m e n t b e t w e e n checks issued
Total, Agriculture,
m e n t a l , cash basis

T o t a l , A g r i c u l t u r a l Adjustment
Administration,
checks-issued basis
A d j u s t m e n t between checks issued
a n d cash exDenditures
T o t a l , Agricultural Adjustm e n t A d m i n i s t r a t i o n , cash
basis
--

104, 573.12
1,396, 377. 29
6,073, 642. 66
1, 215» 070.14
5, 253, 768,41
365, 792.83
186,298.16

121,102.80
2,628,686.17
666, 579. 27
120, 937.83

104, 573.12
1, 517,480.09
7,702, 228.83
1,881, 649.41
6, 253, 763.41
486, 730. 66
186, 298.16

188,602.90
1,638, 539. 63
165,748. 74
299,352.80
201,397.62

30, 558.45
9,828,994. 58
348, 640.03

188, 602.90
1,669,098. 08
9,994, 743. 32
647,992. 83
201,397.62

13, 792, 762.42
19,133, 863. 72

61,728; 212.91

22,826,623.34

84, 564,836. 25

4,666,196.26

308, 598.99

7,108,676.69

6,796,077. 60

62,036,811.90

15, 722,946. 76

77,759, 768. 65

depart-

Agricultural Adjustment Administration:
A d v a n c e s to A g r i c u l t u r a l A d justment Administration
-.
A d v a n c e s to Secretary of Agric u l t u r e for cotton
-A d v a n c e s to D e p a r t m e n t of Agric u l t u r e u n d e r Tobacco Act of
J u n e 28 1934
National Industrial Recovery,
• A g r i c u l t u r a l A d j u s t m e n t Adm i n i s t r a t i o n , N a t i o n a l Recove r y A d m i n i s t r a t i o n , codes
R e f u n d i n g processing tax on farm
Droducts
National Industrial Recovery
Salaries a n d ceneral exoenses
Processing taxes
A d m i n i s t r a t i o n of t h e C o t t o n A c t
of 1934
-- .
P u r c h a s e of s u g a r from processing
taxes

For footnotes, see p. 316.

$674,90§v05
844, 642. 23

844,642.23

(1)

663,539,384.58

563, 539,384. 68
22, 500,000.00

22, 500,000.00
371, 220.03

371,220.03

432,882.95

432,882.96

34,240,895.18
87, 520, 785. 81

32,064,815. 96
34, 240,895.18
87, 520, 785.81

32,064,816.96

19, 593. 36
8, 228, 648. 54

8, 228, 648. 64

365, 536.44

366, 536.44

604,569,605.65

144,694,563.94

749, 264,169.49

11,821,128.84

5, 684, 270. 62

6, 286, 858.22

592,748,476.71

150,278,834.56

743,027, 311. 27

19, 593.36

307

EEPOET OF T H E SECBETABY OF T H E TEEASUEY

TABLE 2.—Details of expenditures, by organization units and accounts, for the fiscal
year 1985—Continued
Organization unit

General and
special
accounts

Emergency
accounts

Total, general,
special, and
emergency
accounts

Trust and
contributed
accounts

D E P A R T M E N T OF A G R I C U L T U R E —

continued
Public highways:
|
National Industrial Recovery
Road construction
.:.
--Flood relief for restoration of roads
and bridges.-.
J
Roads and trails for States, national-forests fund
J

$235, 553,490. 97 $235, 553, 490. 97
67, 718, 976. 57
67, 718, 976. 57

Total,
public
highways,
checks-issued basis
..
Adjustment between checks issued
and cash expenditures
Total, public highways, cash
basis.
'
Department of Agriculture—relief:
Loans and relief in

Full text of Annual Report of the Secretary of the Treasury on the State of the Finances : Annual Report of the Secretary of the Treasury on the State of the Finances for the Fiscal Year Ended June 30, 1935

FRASER