FEDERAL SURPLUS COMMODITIES CORPORATION CONTINUED UNTIL JUNE 30, 1945 (Public Law 634, 77th Cong., June 27, 1942, 56 Stat. 461)

The Federal Surplus Commodities Corporation was chartered by the State of Delaware on October 4, 1933, without specific authority of any Federal statute (19 Comp. Gen. 537, 541). Express acknowledgment of its status as an agency of the United States was first shown by the Congress in the act of June 28, 1937 (50 Stat. 323; 15 U.S.C. 713c) which continues the Corporation as an agency under the Secretary of Agriculture.

The Corporation was created as an essential part of the Government's program for relieving the national economic emergency of the early 1930's. During the 11 years of its active life, the Corporation engaged in the following major programs:

1. Farm products, dairy products, and fuel were purchased to absorb pricedepressing surplus production. This surplus was diverted from commercial channels and distributed to needly families by State relief organizations.

2. A wheat loan fund was designed to aid distribution and exportation of stocks of wheat in excess of a normal reserve.

3. A wheat and flour export fund aided in financing surplus wheat and flour operations and disposing of the surplus outside the United States.

4. The Northeastern Timber Salvage Administration was organized in November 1938 to salvage storm-damaged timber in the northeastern section of the United States.

5. A school lunch program aided in the distribution of surplus food commodities.

6. A food stamp plan was adopted as a method of disposing of surplus farm products.

7. Commodity Credit Corporation used the organization of Federal Surplus Commodities Corporation as an agency in the procurement, stockpiling, and shipment of agricultural commodities immediately prior to and during the war period.

8. The Texas timber salvage program was organized to salvage timber in Texas and adjoining States which had been damaged by a severe ice and sleet storm in January 1944.

The last-named program comprised the final activity of the Corporation. In January 1945, all operations of that program ceased. On March 14, 1947, the dissolution of Federal Surplus Commodities Corporation was completed.

"The Federal Surplus Commodities Corporation is hereby continued as an agency of the United States, under the direction of the Secretary of Agriculture until June 30, 1945."

DISPOSAL OF SURPLUS AGRICULTURAL COMMODITIES, FISCAL YEAR 1943

(Public Law 674, 77th Cong., July 22, 1942, 56 Stat. 694)

The Agriculture Appropriation Act, fiscal year 1943, provided for the reappropriation of 1941 and 1942 unobligated balances of section 32 funds for fiscal year 1943, approximately $150 million.

"To enable the Secretary of Agriculture to further carry out the provisions of section 32, as amended, of the Act entitled 'An Act to amend the Agricultural Adjustment Act, and for other purposes', approved August 24, 1935, and subject to all provisions of law relating to the expenditure of funds appropriated by such section, there is hereby reappropriated for the fiscal year 1943 the unobligated balances of the funds made available for the purposes of such section 32 for the fiscal years 1941 and 1942. Such sums shall be in addition to, and not in substitution for, other appropriations made by such section or for the purposes of such section."

STEAGALL AMENDMENT, AMEND AND EXTEND

(Public Law 729, 77th Cong., Oct. 2, 1942, 56 Stat. 768)

This law amended price policy legislation (Steagall amendment) affecting use of section 32 funds, extended the legislation until 2 years after the war, and increased support price to 90 percent.

"To support, during the continuance of the present war and until the expiration of the two-year period beginning with the 1st day of January immediately following the date upon which the President by proclamation or the Congress

by concurrent resolution declares that hostilities in the present war have ter minated, a price for the producers of any such commodity with respect to which such announcement was made of not less than 90 per centum of the parity or comparable price therefor."

SECTION 32 FUNDS FOR SCHOOL LUNCH AND MILK PROGRAMS, FISCAL YEAR 1944

(Public Law 129, 78th Cong., July 12, 1943, 57 Stat. 392)

This legislation, which authorized the appropriation for the Department of Agriculture for 1944, for the first time authorized a specific amount of section 32 funds for the operation of the school lunch and school milk program. It also provided that such activities could be carried out without regard to the existence of a surplus condition.

"To enable the Secretary of Agriculture to further carry out the provisions of section 32, as amended, of the Act entitled 'An Act to amend the Agricultural Adjustment Act, and for other purposes', approved August 24, 1935, and subject to all provisions of law relating to the expenditure of funds appropriated by such section, during the fiscal year ending June 30, 1944, funds appropriated by or for the purposes of section 32 of said Act shall be available to the Secretary of Agriculture for the maintenance and operation of a school milk and lunch program under clause (2) of said section 32 in a sum not exceeding $50,000,000: Provided, That such funds shall be available for such purposes during the fiscal year 1944 without regard to the requirement therein relating to the encourage ment of domestic consumption but no part of such funds shall be available to defray the expenses of any activity heretofore carried on by the Works Projects Administration."

SECTION 32 FUNDS FOR CERTAIN CLAIM CASES

(Public Law 367, 78th Cong., June 28, 1944, 58 Stat. 450)

This proviso made section 32 funds available in special claim cases involving certain Irish potato and commercial truck crop payments.

"Provided further, That the War Food Administrator is authorized and directed to make payments on Irish potatoes and commercial truck crops for fresh consumption under the 1943 agricultural conservation program with respect to any farm if the War Food Administration determines that the producer would have been eligible for such payments except for the failure of such producer, because of negligence of an officer or agent of the Federal Government, to file on or before June 30, 1943, Form ACP-140, and such payments shall be made out of funds appropriated for the purposes of section 32 of the Act entitled "An Act to amend the Agricultural Adjustment Act, and for other purposes', approved August 24, 1935 (49 Stat. 774)."

SECTION 32 FUNDS FOR SCHOOL LUNCH AND CHILD CARE PROGRAMS,

FISCAL YEAR 1945

(Public Law 367, 78th Cong., June 28, 1944, 58 Stat. 452)

The 1945 fiscal year appropriation for the Department of Agriculture under the appropriation item "Exportation and domestic consumption of agricultural commodities" provided the program authority and funds for carrying out the school lunch program for 1945. The legislation for the first time provided detailed requirements as to the conditions under which Federal assistance was to be provided.

"Not exceeding $50,000.000 of the funds appropriated by and pursuant to this section may also be used during the fiscal year ending June 30, 1945, to provide food for consumption by children in nonprofit schools of high school grade or under and for child-care centers through (a) the purchase, processing, and exchange, and the distribution of agricultural commodities and products thereof; or (b) the making of payments to such schools and centers or agencies having control thereof in connection with the purchase and distribution of agricultural commodities in fresh or processed form and, when desirable, for the processing and exchange of such commodities and their products; or (c) by such other means as the Secretary may determine: Provided, That funds appropriated for the purposes of this program shall be apportioned for expenditure in the States. territories, possessions, and the District of Columbia in accordance with school enrollment and need, as determined by the Secretary, except that if

program participation in any State does not require all funds so apportioned, the Secretary may reapportion such excess funds to such other States in consideration of need, as he may determine: Provided further, That benefits under this section to schools or child-care centers shall in no case exceed the cost of the agricultural commodities or products thereof delivered to the school or child-care center as established by certificates executed by the authorized representative of the sponsoring agency: Provided further, That such sponsoring agency shall maintain accounts and records clearly establishing costs of agricultural commodities or products furnished in the program and that such accounts and records shall be available for audit by representatives of the Department of Agriculture: Provided further, That these funds may be used for, or to make payments in connection with the purchase of such agricultural commodities and for exchanging, distributing, disposing, transporting, storing, processing, inspection, commission, and other incidental costs and expenses without regard to the provisions of section 3709 of the Revised Statutes and without regard to the 25 per centum limitation contained in this section: Provided further, That not more than 2 per centum of the funds made available under this amendment shall be used to provide food for children in child-care centers. The amount of funds used in any State during any fiscal year under this paragraph shall not exceed the total amount otherwise furnished for the same purpose by or on behalf of the State and local school authorities and other sponsoring agencies in such State including the value of donated services and supplies, as certified by the respective schools, care centers or agencies having control thereof."

SECTION 32 FUNDS FOR SCHOOL LUNCH AND CHILD CARE PROGRAMS,

FISCAL YEAR 1946

(Pubic Law 52, 79th Cong., May 5, 1945, 59 Stat. 157)

The Agriculture Appropriation Act, fiscal year 1946, approved the use of section 32 funds for the continuance during the fiscal year 1946 of the school lunch program. The committee stated in reporting this legislation, "This is the same amount, from the same source, as the program for the current fiscal year under substantially the same conditions. Many of the commodities included in the school lunch program are no longer in surplus and for that reason are not authorized for inclusion in the general program carried on under the permanent appropriation. This has resulted in the inclusion of a specific provision in the bill authorizing the use of these moneys for the school lunch program. However, there are still some surpluses for which the school lunch program constitutes an outlet. These surpluses may be of temporary character, yet while they exist they constitute serious problems in maintaining a well-balanced market for the output of the American farm. The school lunch program, therefore, is of double utility and one which apparently commands the favor of a very substantial majority of Members of both Houses of Congress."

"Not exceeding $50,000,000 of the funds appropriated by and pursuant to section 32 as amended, of the Act of August 24, 1935 (7 U.S.C. 612c), may also be used during the current fiscal year to provide food for consumption by children in nonprofit schools of high school grade or under and for child-care centers through (a) the purchase, processing, and exchange, and the distribution of agricultural commodities and products thereof; or (b) the making of payments to such schools and centers or agencies having control thereof in connection with the purchase and distribution of agricultural commodities in fresh or processed form and, when desirable, for the processing and exchange of such commodities and their products; or (c) by such other means as the Secretary may determine: Provided, That funds made available hereunder for a school lunch program shall be apportioned for expenditure in the States, territories, possessions, and the District of Columbia in accordance with school enrollment and need, as determined by the Secretary, except that if program participation in any State, territory, possession, or the District of Columbia does not require all funds so apportioned, the Secretary may reapportion such excess funds to such other States, territories, possessions, or the District of Columbia in consideration of need, as he may determine; Provided further, That benefits under (b) of this paragraph to schools or child-care centers or other sponsoring agencies shall in no case exceed the cost of the agricultural commodities or products thereof purchased by the school or child-care center or other sponsoring agencies as established by certificates executed by the authorized representative of the

sponsoring agency: Provided further, That such sponsoring agency shall maintain accounts and records clearly establishing cost of agricultural commodities or products furnished in the program and that such accounts and records shall be available for audit by representatives of the Department of Agriculture: Provided further, That these funds may be used for, or to make payments in connection with, the purchase of such agricultural commodities and for exchanging, distributing, disposing, transporting, storing, processing, inspection, commission, and other incidental costs and expenses without regard to the provisions of section 3709 of the Revised Statutes and without regard to the 25 per centum limitation contained in said section 32: Provided further, That not more than 2 per centum of the funds made available hereunder for a school lunch program shall be used to provide food for children in child-care centers. The amount of funds available hereunder for a school lunch program used in any State, territory, possession, or the District of Columbia during any fiscal year shall not exceed the total amount otherwise furnished for the same purpose by or on behalf of the school authorities and other sponsoring agencies in such State, territory, possession, or District of Columbia including the value of donated services and supplies, as certified by the respective schools, care centers, or agencies having control thereof".

ADDITIONAL SECTION 32 FUNDS FOR SCHOOL LUNCH, FISCAL YEAR 1946

(Public Law 269, 79th Cong., Dec. 28, 1945, 59 Stat. 645)

"The limitation of $50,000,000 for the objects and for the purposes of the item "School Lunch Program" contained in the Department of Agriculture Appropriation Act, 1946, is increased by $7,500,000".

"National School Lunch Act", section 9, donation of commodities purchased with section 32 funds.

(Public Law 396, 79th Cong., June 4, 1946, 60 Stat. 231)

The National School Lunch Act of June 1946 provided basic authority for a continuing program of Federal assistance to the school lunch program. Section 9 of that act authorized the donation to nonprofit schools of commodities purchased under the authority of section 32.

Commodities purchased under the authority of section 32 of the act of August 24, 1935 (49 Stat. 744), as amended, may be donated by the Secretary to schools, in accordance with the needs as determined by local school authorities, for utilization in the school lunch program under this act as well as to other schools carrying out nonprofit school lunch programs and institutions authorized to receive such commodities.

SECTION 32 FUNDS FOR DISPOSAL OF SURPLUSES, SCHOOL LUNCH AND ACP
PAYMENTS, FISCAL YEAR 1947

(Public Law 422, 79th Cong., June 22, 1946, 60 Stat. 289)

This authority provided for reappropriation of fiscal years 1944, 1945, and 1946 unobligated balances for section 32 funds; $42,500,000 to conservation and use (ACP payments), $75 million for purposes of National School Lunch Act.

To enable the Secretary to further carry out the provisions of section 32, as amended, of the Act entitled "An Act to amend the Agricultural Adjustment Act, and for other purposes", approved August 24, 1935 (7 U.S.C. 612c), and subject to all provisions of law relating to the expenditure of funds appropriated by such section 32, there is hereby reappropriated for the fiscal year 1947 the unobligated balances of the funds made available for the purposes of such section 32 for the fiscal years 1944, 1945, and 1946, less $42,500,000, which is appropriated herein for "Conservation and use of agricultural land resources". Such sums shall be in addition to, and not in substitution for, other appropriations made by or for the purposes of such section 32: Provided, That not exceeding $75,000,000 of the funds appropriated by and pursuant to such section 32 may also be used during the fiscal year 1947, without regard to the 25 per centum limitation contained in said section 32 to carry out the purposes and provisions of the National School Lunch Act, approved June 4, 1946 (Public Law 396) such amount to be exclusive of funds expended in accordance with the last sentence of section 9 of the National School Lunch Act.

SECTION 32 FUNDS FOR DISPOSAL OF SURPLUSES, AND SCHOOL LUNCH,
FISCAL YEAR 1948

(Public Law 266, 80th Cong., June 30, 1947, 61 Stat. 550-551)

Under the Agriculture Appropriation Act, fiscal year 1948, $44 million of permanent appropriation was made available for 1948 section 32 purposes; $65 million transferred to school lunch program; balance ($40,023,930) returned to Treasury. The House Appropriations Committee report, fiscal year 1948, stated the following relative to the use of section 32 funds-"This fund is intended to provide relief in emergent periods when a surplus problem exists."

"Notwithstanding any other provision of section 32, Public Law Numbered 320, Seventy-fourth Congress, approved August 24, 1935, as amended (7 U.S.C., 1940 edition, 612c), not more than $44,000,000 shall be available during the fiscal year ending June 30, 1948, for use in effectuating the purposes of that Act. To enable the Secretary to carry out the provisions of the National School Lunch Act of June 4, 1946 (Public Law 396), there is hereby made available $65,000,000 of the funds appropriated for the fiscal year 1948 by section 32 of the Act approved August 24, 1935 (7 U.S.C. 612c), such amount to be without regard to the 25 per centum limitation contained in said section 32, and to be exclusive of funds expended in accordance with the last sentence of section 9 of the National School Lunch Act: Provided, That no part of such funds shall be used for nonfood assistance under section 5 of said Act. The remainder of the fund appropriated by said Act for the fiscal year 1948 is hereby rescinded effective July 1, 1947, and shall be carried to the surplus fund and covered into the Treasury immediately thereafter".

SECTION 32 FUNDS USED UNDER ECA PROGRAM

(Public Law 472, 80th Cong., Public Law 535, 81st Cong., Apr. 3, 1948, 62 Stat. 137, 64 Stat. 199)

Authority was provided in the Foreign Assistance Acts of 1948 and 1950, for the Secretary of Agriculture to dispose of surplus commodities to other Government agencies and to use section 32 funds to pay not to exceed 50 percent of the sales price therefor.

"SEC. 112(f). Subject to the provisions of this section, but notwithstanding any other provision of law, in order to encourage utilization of surplus agricultural commodities pursuant to this or any other Act providing for assistance or relief to foreign countries, the Secretary of Agriculture, in carrying out the purposes of clause (1), section 32, Public Law 320, Seventy-Fourth Congress, as amended, may make payments, including payments to any government agency procuring or selling such surplus agricultural commodities, in an amount not to exceed 50 per centum of the sales price (basis free along ship or free on board vessel, United States ports), as determined by the Secretary of Agriculture, of surplus agricultural commodities. The rescission of the remainder of section 32 funds by the Act of July 30, 1947 (Public Law 266, Eightieth Congress), is hereby canceled and such funds are hereby made available for the purposes of section 32 for the fiscal year ending June 30, 1948".

SECTION 32 FUNDS FOR SCHOOL LUNCH-LIMITATION OF THE USE OF SECTION 32 FUNDS FOR INSULATION PRODUCTS, FISCAL YEAR 1949

(Public Law 712, 80th Cong., June 19, 1948, 62 Stat. 526–527)

To enable the Secretary to carry out the provisions of the National School Lunch Act of June 4, 1946 (Public Law 396), there is hereby made available $75,000,000 of the funds appropriated for the fiscal year 1949 by section 32 of the Act approved August 24, 1935 (7 U.S.C. 612c), such amount to be without regard to the 25 per centum limitation contained in said section 32, and to the exclusive of funds expended in accordance with the last sentence of section 9 of the National School Lunch Act: Provided, That no part of such funds shall be used for nonfood assistance under section 5 of said act.

Not to exceed $500,000 of the appropriation made available by section 32 of the Act of August 24, 1935 (7 U.S.C. 612c), shall be used to pay any subsidy, benefit, or indemnity to manufacturers of or dealers in insulation products.