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count of such property. (June 15, 1929, sec. 4, 46 Stat. 13; Aug. 19, 1937, sec. 37, 50 Stat. 717; 12 U. S. C., sec. 1141b.)

638-283. Special powers of administration.—Thé board [now administration]* is authorized and directed

(1) to promote education in the principles and practices of cooperative marketing of agricultural commodities and food products thereof.

(2) to encourage the organization, improvement in methods, and development of effective cooperative associations.

(3) to keep advised from any available sources and make reports as to crop prices, experiences, prospects, supply, and demand, at home and abroad. (June 15, 1929, sec. 5, 46 Stat. 13; June 16, 1933, sec. 50 (a), 48 Stat. 265; 12 Ú. S. C., sec. 1141c.)

638–284. Revolving fund.—There is hereby authorized to be appropriated the sum of $500,000,000 which shall be made available by the Congress as soon as practicable after the approval of this Act and shall constitute a revolving fund to be administered by the board (now administration]* as provided in this Act. Any and all funds derived from the sale, lease, operation, or other disposition of any property, real or personal, acquired by the United States on account of or as a result of any loan made pursuant to the provisions of this Act, shall be covered into and become a part of said revolving fund. (June 15, 1929, sec. 6, 46 Stat. 14; June 16, 1933, secs. 33, 34, 40, 41, 48 Stat. 262, 264; Aug. 19, 1937, sec. 38, 50 Stat. 718; 12 U. S. C., sec. 1141d.)

638–285. Interest rates on loans made from revolving fund.—That interest rates in excess of the rates set forth in notes or other obligations taken by the Federal Farm Board or the Farm Credit Administration for loans made from the revolving fund authorized by section 6 of the Agricultural Marketing Act, approved June 15, 1929 (46 Stat. 11), shall not be charged or collected on any of said loans, whether such loans have been heretofore or are hereafter paid in whole or in part, except that in those cases where a borrower by specific contract has agreed to pay a higher rate of interest, the contract rate shall be charged for the period agreed upon; and the amount of any interest collected in excess of the rates thus set forth or contracted for shall be refunded out of said fund or credited on the borrower's indebtedness. (June 22, 1939, 53 Stat. 853; 12 U.S.C., 1141d-1. This section is not a part of the Agricultural Marketing Act.)

638–286. Loans to cooperative associations.-(a) Upon application by any cooperative association the board [now administration] * is authorized to make loans to it from the revolving fund to assist in

(1) the effective merchandising of agricultural commodities and food products thereof and the financing of its operations;

(2) the construction or acquisition by purchase or lease, or refinancing the cost of such construction or acquisition, of physical facilities.

(b) No loan shall be made to any cooperative association unless, in the judgment of the board [now administration]*, the loan is in furtherance of the policy declared in section 1 and the cooperative association applying for the loan has an organization and management, and business policies, of such character as to insure the reasonable safety of the loan and the furtherance of such policy.

*See Ex. Or. 6084, p. 254, this volume.

(c) Loans for the construction or acquisition by purchase or lease of physical facilities, or for refinancing the cost of such construction or acquisition, shall be subject to the following conditions:

(1) No loan shall be made in an amount in excess of 60 per centum of the appraised value of the security therefor.

(2) No loan for the purchase or lease of such facilities shall be made unless the Governor of the Farm Credit Administration finds that the purchase price or rent to be paid is reasonable.

(d) Loans for the construction or purchase of physical facilities, together with interest on the loans, shall be repaid upon an amortization plan over a period not in excess of twenty years. (June 15, 1929, sec. 7, 46 Stat. 14; June 16, 1933, secs. 50-53, 48 Stat. 265; June 3, 1935, secs. 9, 10, 49 Stat. 316; 12 U. S. C., sec. 1141e.)

NOTE.—Subsection (a) of this section originally contained third paragraph, relating to loans to assist in forming clearing house associations, which was repealed by section 50(a) of the Farm Credit Act of June 16, 1933.

Subsection (a) of this section originally contained a fourth paragraph, relating to loans for education in the advantages of cooperative marketing, which was repealed by section 50(a) of the Farm Credit Act of June 16, 1933.

Subsection (a) of this section originally contained a fifth paragraph, as follows: “(5) enabling the cooperative association applying for the loan to advance to its members a greater share of the market price of the commodity delivered to the association than is practicable under other credit facilities.”

This paragraph was repealed by section 50(a) of the Farm Credit Act of June 16, 1933, subject to the following provision of section 50(b) of that Act:

“The repeal of section 7(a) (5) shall not be construed to prohibit the extension, renewal, or refinancing of any loan made thereunder and outstanding on the date of the enactment of this Act, but loans to extend, renew, or refinance any such loan shall bear interest rates as determined under section 8(a) of the Agricultural Marketing Act as amended by section 54 of this Act.

See paragraphs 638–261 and 638-268 of this volume for loans to cooperative associations by banks for cooperatives, established under the Farm Credit Act of June 16, 1933, and capitalized from the revolving fund provided for in paragraph 638-283 hereof.

638-287. Miscellaneous loan provisions.(a) Loans to any cooperative association shall bear such rates of interest as the Governor of the Farm Credit Administration shall from time to time determine to be necessary for the needs of the lending agencies and shall by regulation prescribe (but in no case shall the rate of interest exceed 6 per centum per annum on the unpaid principal): Provided, however, That the rate of interest on any loan made under the provisions of section 7 (a) (1) hereof, other than upon the security of commodities, shall conform as nearly as may be practicable to a rate 1 per centum in excess of the prevailing interest rate paid by production credit associations to the Federal intermediate credit bank of the farm credit district in which the principal business office of the borrower is located; the rate of interest on any loan made upon the security of commodities shall conform, as nearly as may be practicable, to the prevailing interest rate on commodity loans charged borrowers from the Federal intermediate credit bank of the farm credit district in which the principal business office of the borrower is located; and that the rate of interest on any loan made under the provisions of section 7 (a) (2) hereof shall conform as nearly as may be practicable to the prevailing rate on mortgage loans made to members of national farm loan associations.

18o in original.

(b) Payments of principal or interest upon any such loan or advance shall be covered into the revolving fund.

(c) Loans to any cooperative association or stabilization corporation shall be made upon the terms specified in this Act and upon such other terms not inconsistent therewith and upon such security as the board snow administration]* deems necessary.

(d) No loan or insurance agreement shall be made by the board [now administration]* if in its judgment the agreement is likely to increase unduly the production of any agricultural commodity of which there is commonly produced a surplus in excess of the annual marketing requirements. "(June 15, 1929, sec. 8, 46 Stat. 14; June 16, 1933, sec. 54, 48 Stat. 266; June 3, 1935, sec. 11, 49 Stat. 316; Aug. 19, 1937, sec. 5 (a), 50 Stat. 704; 12 U. S. C., sec. 1141f.)

638–288. Stabilization corporations.—(a) The board [now administration]* may, upon application of the advisory commodity committee for any commodity, recognize as a stabilization corporation for the commodity any corporation if

(1) The board (now administration]* finds that the marketing situation with respect to the agricultural commodity requires or may require the establishment of a stabilization corporation in order effectively to carry out the policy declared in section 1; and

(2) The board [now administration]* finds that the corporation is duly organized under the laws of a State or Territory; and

(3) The Board [now administration]* finds that all the outstanding voting stock or membership interests in the corporation are and may be owned only by cooperative associations handling the commodity; and

(4) The corporation agrees with the board [now administration]* to adopt such by-laws as the board [now administration]* may from time to time require, which by-laws, among other matters, shall permit cooperative associations not stockholders or members of the corporation to become stockholders or members therein upon equitable terms.

(b) Any stabilization corporation for an agricultural commodity (1) may act as a marketing agency for its stockholders or members in preparing, handling, storing, processing, and merchandising for their account any quantity of the agricultural commodity or its food products, and (2) for the purpose of controlling any surplus in the commodity in furtherance of the policy declared in section 1, may prepare, purchase, handle, store, process, and merchandise, otherwise than for the account of its stockholders or members, any quantity of the agricultural commodity or its food products whether or not such commodity or products are acquired from its stockholders or members.

(c) Upon request of the advisory committee for any commodity the board [now administration]* is authorized to make loans from the revolving fund to the stabilization corporation for the commodity for working capital to enable the corporation to act as a marketing agency for its stockholders or members as hereinbefore provided. Not less than 75 per centum of all profits derived by a stabilization corporation each year from its operations as such a marketing agency shall be paid into a merchandising reserve fund to be established by the corporation. No such payment shall be required whenever the fund is in such amount as, in the judgment of the board [now administration)*, constitutes a sufficient reserve for such operations of the corporation. Out of the remainder of such profits for the year the corporation shall repay any outstanding loan made under this subdivision and the accrued interest thereon, or if all such loans and accrued interest have been fully repaid, then it may distribute a patronage dividend to its stockholders or members. Such patronage dividend shall be paid to each stockholder or member on the basis of the total volume of the commodity or its products for the year marketed for his account through the corporation.

*Seo Ex, Or. 6084, p. 254, this volume.

(d) Upon request of the advisory committee for any commodity the board [now administration * is authorized to make loans from the revolving fund to the stabilization corporation for the commodity to enable the corporation to control any surplus in the commodity as hereinbefore provided and for meeting carrying and handling charges and other operating expenses in connection therewith. The board [now administration]* shall require a stabilization corporation to establish and maintain adequate reserves from its profits from its surplus control operations before it shall pay any dividends out of such profits. All losses of the corporation from such operations shall be paid from such reserves, or if such reserves are inadequate, then such losses shall be paid by the board [now administration]* as a loan from the revolving fund. Any amounts so loaned for payment of losses shall be repaid into the revolving fund by the corporation from future profits from its surplus control operations. Any stabilization corporation receiving loans under this subdivision for surplus control operations shall exert every reasonable effort to avoid losses and to secure profits, but shall not withhold any commodity from the domestic market if the prices have become unduly enhanced, resulting in distress to domestic consumers. Stockholders or members of the corporation shall not be subject to assessment for any losses incurred in surplus control operations of the corporation.

(e) A stabilization corporation shall keep such accounts, records, and memoranda, and make such reports with respect to its transactions, business methods, and financial condition, as the board [now administration]* may from time to time prescribe; shall permit the board [now administration]* to audit its accounts annually and at such other times as the board (now administration]* deems advisable; and shall permit the board [now administration]*, upon its own initiative or upon written request of any stockholder or member, to investigate the financial condition and business methods of the corporation.

(f) No loan shall be made to any stabilization corporation unless, in the judgment of the board (now administration]*, the loan is in furtherance of the policy declared in section 1. (June 15, 1929, sec. 9, 46 Stat. 14; 12 U.S. C., sec. 1141g.)

638–289. Avoidance of duplication; cooperation with other governmental establishments; obtaining information and data; cooperation with States, Territories, and agencies or subdivisions thereof; indicating research problems; transfer of offices, functions, etc.—(a) The board (now administration * shall, in cooperation with any governmental establishment in the Executive branch of the Government, including any field service thereof at home or abroad, avail itself of the services and facilities thereof in order to avoid preventable expense or duplication of effort.

*See Ex. Or. 6084, p. 254, this volume.

(b) The President may by Executive order direct any such governmental establishment to furnish the board (now administration] * such information and data as such governmental establishment may have pertaining to the functions of the board (now administration]*; except that the President shall not direct that the board (now administration]* be furnished with any information or data supplied by any person in confidence to any governmental establishment in pursuance of any provision of law or of any agreement with a governmental establishment.

(c) The board [now administration]* may cooperate with any State or Territory, or department, agency, or political subdivision thereof, or with any person.

(d) The board (now administration]* shall, through the Secretary of Agriculture (governor]*, indicate to the appropriate bureau or division of the Department of Agriculture any special problem on which a research is needed to aid in carrying out the provisions of this Act.

(e) The President is authorized, by Executive order, to transfer to or retransfer from the jurisdiction and control of the board (now administration]* the whole or any part of (1) any office, bureau, service, division, commission, or board in the Executive branch of the Government engaged in scientific or extension work, or the furnishing of services, with respect to the marketing of agricultural commodities, (2) its functions pertaining to such work or services, and (3) the records, property, including office equipment, personnel, and unexpended balances of appropriation, pertaining to such work or services. (June 15, 1929, sec. 13, 46 Stat. 17; 12 U.S.C., sec. 1141h.)

638–290. Examination of books and accounts; limitation on purpose of examination respecting expenditures from revolving fund.—Vouchers approved by the chairman of the board (now Governor of the Farm Credit Administration]* for expenditures from the revolving fund pursuant to any loan or advance or from insurance moneys pursuant to any insurance agreement, shall be final and conclusive upon all officers of the Government; except that all financial transactions of the board (now administration]* shall, subject to the above limitations, be examined by the General Accounting Office at such times and in such manner as the Comptroller General of the United States may by regulation prescribe. Such examination, with respect to expenditures from the revolving fund pursuant to any loan or advance or from insurance moneys pursuant to any insurance agreement, shall be for the sole purpose of making a report to the Congress and to the board [now administration)* of expenditures and of loan and insurance agreements in violation of law, together with such recommendations thereon as the Comptroller General deems advisable. (June 15, 1929, sec. 14, 46 Stat. 18; 12 U.S. C., sec. 1141i.)

638–291. Miscellaneous provisions.

"Cooperative association" defined. (a) As used in this Act, the term "cooperative association” means any association in which farmers act together in processing, preparing for market, handling, and/or marketing the farm products of persons so engaged, and also means any

*See Ex. Or. 6084, p. 254, this volume.

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