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to the provisions of this title, of an amount of tax equal to (1) the amount of credits or refunds which he estimates will be allowed or made during such period pursuant to section 15 (c) with respect to the commodity and (2) the amount of tax which he estimates would have been collected during such period upon all processings of such commodity which are exempt from tax by reason of the fact that such processings are done by or for a State, or a political subdivision or an institution thereof, had such processings been subject to taz: Provided, however, That the rate of tax upon the processing of any commodity, in effect on the date on which this amendment is adopted, shall not be affected by the adoption of this amendment and shall not be required to be adjusted or altered, unless the Secretary of Agriculture finds that it is necessary to adjust or alter any such rate in order to effectuate the declared policy of the title; except that (1) if the Secretary has reason to believe that the tax at such rate on the processing of the commodity generally or for any particular use or uses will cause such reduction in the quantity of the commodity or products thereof domestically consumed as to result in the accumulation of surplus stocks of the commodity or products thereof or in the depression of the farm price of the commodity, then he shall cause an appropriate investigation to be made and afford due notice and opportunity for hearing to interested parties, and if thereupon the Secretary finds that any such result will occur, then the processing tax on the processing of the commodity generally, or for any designated use or uses, or as to any designated prod. uct or products thereof for any designated use or uses, shall be at such rate as will prevent such accumulation of surplus stocks and depression of the farm price of the commodity, and (2) for the period from April 1, 1935, to July 31, 1936, both inclusive, the processing tax with respect to rice shall be at the rate of 1 cent per pound of rough rice, subject, however, to any modification of such rate wbich may be made pursuant to any other provision of this title. In computing the current average farm price in the case of wheat, premiums paid producers for protein content shall not be taken into account. In the case of rice, the weight to which the rate of tax shall be applied shall be the weight of rough rice when delivered to & processor, except that where the producer processes his own rice, the weight to which the rate of tax shall be applied shall be the weight of rough rice when delivered to the place of processing. In the case of sugar beets or sugarcane the rate of tax shall be applied to the direct-consumption sugar, resulting from the first domestic processing, translated into terms of pounds of raw value according to regulations to be issued by the Secretary of Agriculture, and the rate of tax to be so applied shall be the higher of the two following quotients: The difference between the current average farm price and the fair exchange value (1) of a ton of sugar beets and (2) of a ton of sugarcane, divided in the case of each commodity by the average extraction therefrom of sugar in terms of pounds of raw value (which average extraction shall be determined from available statistics of the Department of Agriculture); except that such rate shall not exceed the amount of the reduction by the President on a pound of sugar raw value of the rate of duty in effect on January 1, 1934, under paragraph 501 of the Tariff Act of 1930, as adjusted to the treaty of commercial reciprocity concluded between the United States and the Republic of Cuba on December 11, 1902, and/or the provisions of the Act of December 17, 1903, chapter 1.
(c) For the purposes of part 2 of this title, the fair-exchange value of a commodity shall be the price therefor that will give the commodity the same purchasing power, with respect to articles farmers buy, as such commodity had during the base period specified in section 2; [and the current average farm price and the fair-exchange value shall be ascertained by the Secretary of Agriculture from available statistics of the Department of Agriculture] and, in the case of all commodities where the base period is the prewar period, August 1909 to July 1914, will also reflect interest payments per acre on farm indebtedness secured by real estate and tax payments per acre on farm real estate, as contrasted with such interest payments and tax payments during said base period; and the current average farm price and the fair-exchange value shall be ascertained by the Secretary of Agriculture from available statistics of the Department of Agriculture. The rate of tax upon the processing of any commodity, in effect on the date on which this amendment is adopted, shall not be affected by the adoption of this amendment and shall not be required to be adjusted or altered, unless the Secretary of Agriculture finds that it is necessary to adjust or alter any such rate pursuant to section 9 (a) of this title.
(Sec. 10) (b) (1) The Secretary of Agriculture is authorized to establish, for the more effective administration of the functions vested in him by this title, State and local committees, or associations of producers, and to permit cooperative associations of producers, when in his judgment they are qualified to do so, to act as agents of their members and patrons in connection with the distribution of rental or benefit payments or payments for expansion of domestic or foreign markets. The Secretary, in the administration of this title, shall accord such recognition and encouragement to producer-owned and producer-controlled cooperative associations as will be in harmony with the policy toward cooperative associations set forth in existing Acts of Congress, and as will tend to promote efficient methods of marketing and distribution.
(2) Each license issued by the Secretary under this title shall provide that each licensee thereunder shall pay to any authority or agency established under such license, such licensee's pro rata share (as approved by the Secretary) of such expenses as the Secretary may find will necessarily be incurred by such authority or agency, during any period specified by him, for the maintenance and functioning of such authority or agency, other than expenses incurred in receiving, handling, holding, or disposing of any quantity of a commodity received, handled, held, or disposed of by such authority or agency for the benefit or account of persons other than such licensees. Any such authority or agency may maintain in its own name, or in the names of its members, a suit against any licensee for the collection of such licensee's pro rata share of expenses. The several district courts of the United States are hereby vested with jurisdiction to entertain such suits regardless of the amount in controversy.
(e) The action of any officer, employee, or agent in determining the amount of and in making any rental or benefit payment or payment for expansion of domestic or foreign markets shall not be subject to review by any officer of the Government other than the Secretary of Agriculture or Secretary of the Treasury.
SEC. 12. (a) There is hereby appropriated, out of any money in the Treasury not otherwise appropriated, the sum of $100,000,000 to be available to the Secretary of Agriculture for administrative expenses under this title and for rental and benefit payments and payments for expansion of domestic or foreign markets made with respect to [reduction] adjustment in acreage or [reduction] adjustment in production for market under part 2 of this title. Such sum shall remain available until expended.
To enable the Secretary of Agriculture to finance, under such terms and conditions as he may prescribe, surplus reductions and production adjustments with respect to the dairy- and beef-cattle industries, and to carry out any of the purposes described in subsections (a) and (b) of this section (12) and to support and balance the markets for the dairy- and beef-cattle industries, there is authorized to be appropriated, out of any money in the Treasury not otherwise appropriated, the sum of $200,000,000: Provided, That not more than 60 per centum of such amount shall be used for either of such industries.
(b) In addition to the foregoing, for the purpose of effectuating the declared policy of this title, the proceeds derived from all taxes imposed under this title are hereby appropriated to be available to the Secretary of Agriculture for (1) expansion of domestic and foreign markets and removal of surplus agricultural commodities or surplus products of agricultural commodities, (2) the acquisition of any agricultural commodity pledged as security for any loan made by any Federal agency, which loan was conditioned upon the borrower agreeing or having agreed to cooperate with a program of production adjustment or marketing adjustment adopted under the authority of this title, and (3) the following purposes under part 2 of this title: Administrative expenses, rental and benefit payments, payments for expansion of domestic or foreign markets, and refunds on taxes. The Secretary of Agriculture and the Secretary of the Treasury shall jointly estimate from time to time the amounts, in addition to any money available under subection (a), currently required for such purposes; and the Secretary of the Treasury shall, out of any money in the Treasury not otherwise appropriated, advance to the Secretary of Agriculture the amounts so estimated. The amount of any such advance shall be deducted from such tax proceeds as shall subsequently become available under this subsection.
(c) The administrative expenses provided for under this section shall include, among others, expenditures for personal services and rent in the District of Columbia and elsewhere, for law books and books of reference, for contract stenographic reporting services, and for printing and paper in addition to allotments under the existing law. The Secretary of Agriculture shall transfer to the Treasury Department, and is authorized to transfer to other agencies, cut of
funds available for administrative expenses under this title, such sums as are required to pay administrative expenses incurred and refunds made by such department or agencies in the administration of this title.
(d) There is authorized to be appropriated for each fiscal year, in addition to other amounts authorized or appropriated under this title, an amount equal to 30 per centum of the gross receipts from duties collected under the customs laws during the period January 1 to December 31, both inclusive, preceding the beginning of such fiscal year. Sums appropriated in pursuance of such authorization shall be maintained in a separate fund and shall be used by the Secretary of Agriculture only to: (1) Encourage the exportation of agricultural commodities by the payment of benefits in connection with the exportation thereof or of indemnities for losses incurred in connection with such exportation, or by payments to producers in connection with the production of that part of the production of any agricultural commodity required for domestic consumption; (2) purchase or lease, on behalf of the United States, submarginal agricultural and grazing lands; and (3) make payments, which shall not be considered rental or benefit payments, in connection with acreage or production adjustment of basic agricultural commodities. The Secretary shall expend the amounts appropriated in pursuance of this subsection for such of the above specified purposes, and at such times, in such manner, and in such amounts as he finds and prescribes as best effectuating the policy of restoration of agricultural purchasing power as contemplated by section 2 of this title consistently with the fullest utilization of the productive capacity of land which can be profitably cultivated and with the most rapid expansion of exportation of agricultural commodities. The provisions of subsection (6) of this section relating to estimates, advances, and deductions shall apply to expenditures and receipts under this subsection.
(e) Amounts expended under this title which are expended for expansion of domestic and foreign markets, removal of surpluses, administrative expenses, and rental and benefit payments in connection with any basic agricultural commodity, shall not be less than a sum equal to the proceeds of the taxes levied under this title with respect to such commodity. For the purposes of this subsection: (1) Amounts collected and expended from taxes, the proceeds of which under this title are held for, or paid for use in, any possession of the United States, shall not be included; (2) the amount of all refunds and abatements of taxes shall not be included; and (3) hogs and field corn may be considered as one commodity.
(Sec. 15) (d) The Secretary of Agriculture shall ascertain from time to time whether the payment of the processing tax upon any basic agricultural commodity is causing or will cause to the [processors] processors, producers, or both, thereof disadvantages in competition from competing commodities by reason of excessive shifts in consumption between such commodities or products thereof. If the Secretary of Agriculture finds, after investigation and due notice and opportunity for hearing to interested parties, that such disadvantages in competition exists, or will exist, he shall proclaim such finding. The Secretary shall specify in this proclamation the competing commodity and the compensating rate of tax on the processing thereof necessary to prevent such disadvantages in competition. Thereafter there shall be levied, assessed, and collected upon the first domestic processing of such competing commodity a tax, to be paid by the processor, at the rate specified, until such rate is altered pursuant to a further finding under this section, or the tax or rate thereof on the basic agricultural commodity is altered or terminated. In no case shall the tax imposed upon such competing commodity exceed that imposed per equivalent unit, as determined by the Secretary, upon the basic agricultural commodity.
This is not a minority report in the usual sense, as many of the undersigned members of the Committee on Agriculture favor several provisions of the bill and desire to reserve the right to vote for or against H. R. 7713 on final passage. The report is therefore made as an explanatory statement for the benefit of the membership of the House in order to clarify, as far as possible, any misinformation or misunderstanding as to the purport of the bill.
FARM LEGISLATION NOT POLITICAL
The subject of farm legislation has not been considered by the members of the Committee on Agriculture on a political or partisan basis. All members of the committee are in general and whole-hearted accord in any constructive effort which seeks to restore equality for agriculture and make farming a profitable enterprise. We are of the firm conviction that there will be no permanent recovery for the entire country until agriculture has been restored to a profitable basis.
We are not opposing certain parts of this legislation merely for the sake of being against something which has been proposed, as we have a sincere desire for this Congress, in its representative capacity, to enact a type of permanent beneficial legislation which will meet the needs of the present emergency and at the same time adequately serve the requirements of agriculture in a long-time program during normal times.
We are opposed to the further granting of additional authority and power by Congress to any governmental agency or officer for the purpose of regimenting farmers and the agricultural industry of this country as is proposed in certain sections of H. R. 7713.
All Members of Congress have received scores of letters for and against the Agricultural Adjustment Administration amendments. Nearly all communications have referred to H. R. 5585, which bill has been modified and broadened in certain instances, and is now before the House as H. R. 7713.
Since April 1, 1935, Members of Congress from the Corn Belt sections have received hundreds of letters from farmers who are members of local corn-hog committees requesting the continuation of the corn-hog and corn-loan programs.
Neither Å. R. 5585 or H. R. 7713 seeks to repeal or in any way curtail the present corn-hog or corn-loan program now in efiect in the Agricultural Adjustment Act, and yet the originators of this propaganda, which no doubt was broadcast by interested parties in Washington to farmers in all sections of the country, have sent out misleading information in order to secure pressure for the passage of H. R. 7713 which has nothing to do with the continuation of the cornhog or corn-loan programs.
We are giving herewith a copy of the misleading propaganda above referred to. The names of Representatives, Senators, and the department chief have been omitted, as we have no desire to cause embarrassment for anyone at this time.
We have been asked by those vitally interested in the welfare of the farmer to contact some in this county requesting them to write to the names of the parties listed below urging them to favor the Agricultural Adjustment Administration program and support all measures pertaining to the continuation of cornhog section of the administration.
There are opposing factions in Washington and throughout the country who are doing everything possible to hinder the organization and collective action of the farmer.
Won't you please write to these parties and assume the responsibility to do so at once?
If you believe in the policy of the administration, tell them; and if you have been benefited by the corn-hog program let them know it and how you have been helped.
Below you will find a few suggestions that may help you. Your cooperation is earnestly desired and your prompt action is necessary.
Favor amendments.-Farm grain storage (ever normal granary); long time program; planned agriculture (corn-loan program); licensing power (of packers, etc.); collect processing tax without paying on any particular commodity (distribution of processing tax to all farm commodities).
MARKETING AGREEMENTS AND LICENSES
In the hearings before the committee, Mr. Chester Davis, Chief of the Agricultural Adjustment Administration, and Secretary Wallace, both stated that the existing law conferred upon the Secretary the power to negotiate marketing agreements and impose licenses. As evidence of this fact, the committee was advised that the Secretary had approved 66 marketing agreements and issued 7,700 licenses to handlers, processors, and distributors. We were informed that the necessity for the enactment of the license provisions of H. R. 7713, was largely for the purpose of confirming and clarifying powers already granted to the Secretary of Agriculture by the Agricultural Adjustment Act.
It is difficult for us to understand the very indefinite and vague reasons given by the officials of the Department of Agricluture for the necessity for tbis bill, when they already claim the authority and have acted thereunder by the approval of a large number of marketing agreements and licenses, unless it is the purpose of the Secretary to further tighten his control over farmers and the handlers, distributors, and processors of farm products.
If the purpose of the legislation is to establish congressional intent in order to aid the courts in interpreting a Federal act, it is presumptuous on our part to even intimate that Congress should first have a clear conception or understanding of what is intended by the language in the bill.
At the present time it is doubtful if any member of the committee has a clear conception of the extent of the authority being conferred by the bill upon the Secretary. Therefore, our only conclusion can be that there is no limit to what he can do with the powers delegated to him.