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Department of State nor any other branch of the administration has asked for this bill. The conservative public opinion of the country is apparently opposed to this type of legislation, if we may judge by the editorial expressions of the New York Times, the New York HeraldTribune, the Baltimore Sun, the Washington Post, the ScrippsHoward papers and others. Finally, this country has learned by bitter experience that laws repressing ideas and opinions have always merely helped to drive underground such ideas and opinions, to intensify and publicize them, and to embitter and make martyrs of their propoments.

O

READJUSTMENT OF ACCOUNT BETWEEN UNITED

STATES AND VERMONT

Mar 27, 1935.-Committed to the Committee of the Whole House on the state

of the Union and ordered to be printed

Mr. PLUMLEY, from the Committee on War Claims, submitted the

following

REPORT

[To accompany S. J. Res. 89]

The Committee on War Claims, to whom was referred the bill (S. J. Res. 89) directing the Comptroller General to readjust the account between the United States and the State of Vermont, having considered the same, report thereon with a recommendation that it do pass without amendment.

The purpose of said joint resolution is to grant to the State of Vermont the same relief as has been accorded to the States of Maryland, Massachusetts, Virginia, South Carolina, New York, Pennsylvania, Delaware, and North Carolina. The claims of these States grew out of advances made to the United States to aid in the national defense during the War of 1812–15 with Great Britain, and were of like character to that of Vermont, and have all been appropriated for and paid by Congress.

Facts with respect to the claim of the State of Vermont are brought out in a memorandum hereto attached, marked "Exhibit A.”

The facts are more fully set forth in a letter from the Comptroller General of the United States to the Senate, in response to Senate Resolution No. 224, Seventy-third Congress, second session, a copy of which letter, bearing date of February 19, 1935, is hereto attached, marked “Exhibit B.” In said letter, the Comptroller General finds the balance due the State of Vermont in the sum of $92,868.90.

With respect to the above audit, the Comptroller General holds that, as this audit was made

by direction of a Senate Resolution, and not by joint action of both Houses of Congress, the audit is not one that has been made by virtue of an Act of Congress, and, therefore, that he is not authorized to certify the result of such audit to Congress

H. Repts., 74–1, vol. 271

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as an estimate of appropriation, germane to a deficiency appropriation bill.

It is for the purpose of clothing the audit which the Comptroller General will make under this joint resolution (in the above amount or in such other amount as he may find due), with a certified status, that the State of Vermont seeks the enactment of said S. J. Res. 89.

Exhibit A

MEMORANDUM BEARING ON THE 1812/15 WAR CLAIM OF THE STATE OF VERMONT

Senate Joint Resolution 89, directing the Comptroller General of the United States to adjust the account between the United States and the State of Vermont, arising out of the War of 1812.

The claim of the State of Vermont, to which Senate Joint Resolution 89 is directed, is fully set forth in Senate Document No. 23, Seventy-fourth Congress, first session, being the results of an audit by the Comptroller General of the United States made by virtue of Senate Resolution No. 224, Seventy-third Congress, second session, as set forth in the Senate document cited.

The above audit was submitted to the President of the Senate on February 19, 1935, and discloses that there is due the State of Vermont from the United States, the sum of $92,868.90.

The Senate Resolution, No. 224, under which the audit by the Comptroller General was to be made, directed that the same rule should be applied to the account of the State of Vermont, as had been applied to the settlement of the account of the State of Maryland under the act of March 3, 1857 (11 Stat. 229).

This act provided for the application of the present-day rule of computing interest on the principal up to a partial payment, and applying the payment first to the extinguishment of the accrued interest.

The above act of March 3, 1857, further provided:

“Second, interest shall be allowed the State of Maryland on such sums only on which the State either paid interest or lost interest by the transfer of an interest-bearing fund.”. (See p. 2, of S. Doc. No. 52, 70th Cong., above-cited.)

Upon the passage of the act of March 3, 1857, the provisions of section 12 thereof, were submitted to the Attorney General for an opinion as to its scope. In this opinion, the Attorney General made the following statement:

Where Congress authorizes the payment of a debt, with interest, this, withont more, means that legal interest shall be paid on the whole of the principal for all time during which the principal has been unpaid * Congress has given to Maryland interest on her debt; and I look in vain for anything which declares that in erest shall be stopped before the principal is paid.” (See 9th Atty. Gen. Op 57.)

This provision of law came to be known as the “Maryland Rule”, and has since been applied to all of the claims of the States for interest growing out of the War of 1812-15.

The State of Maryland received under the provisions of the act of March 3, 1857, the sum of $275,770.23.

The State of Massachusetts received under the provisions of the act of July 8, 1870 (16 Stat. 197) in the application of the same rule, the sum of $678,362.42 for herself and the State of Maine.

Thereafter, other States sought payment of their interest accounts, growing out of their expenditures in the War of 1812, and measures directed to that objective received favorable reports at various times from the 49th to the 56th Congresses. (See exhibit A, hereto attached.)

In the year 1902, there was before the Senate an omnibus claims bill in which was included a provision for the payment of the claims of the States, for interest payments during the War of 1812-15.

This bill was favorably reported by Senator Warren on February 12, 1902. (See S. Rept. 493 on H. R. 8587), wherein the following statement is made:

"During the war of 1812-1814 the States of Massachusetts, New York, Pennsylvania, Delaware, Maryland, Virginia, South Carolina, and the city of Baltimore expended certain moneys for military purposes. Whether wisely or unwisely, after many years the United States treated the sums thus expended as

*

advanced to or spent for the benefit of the National Government, and therefore a debt payable with interest, and accordingly made refund, with interest.

“Your committee are unable to discover any reason, resting in law or justice, why the States mentioned in this bill, and the city of Baltimore, should not be treated precisely as Maryland and Massachusetts were treated. The expenditures were made at the same time, for the same patriotic purpose, and the relation of the States to each other under the Constitution requires that as to reimbursement of principal and interest they should be treated alike."

The above omnibus claims bill matured into the act of May 27, 1902 (32 Stat. L. 235), under which the States of Virginia, South Carolina, and the city of Baltimore were reimbursed for interest expenditures growing out of the War of 1812–15.

In the next Congress, the act of February 24, 1905, was passed (33 Stat. L. 777), which made provision for the adjustment of the interest claims of the States of New York, Pennsylvania, and Delaware, to be settled under the so-called “Maryland rule.”

In payment of these claims, there was provided in the Deficiency Appropriation Act of February 27, 1906 (34 Stat. L. 29), an appropriation of $118,585.84 to the State of New York, and an appropriation of $236,762.65 to the State of Pennsylvania. In the Deficiency Appropriation Act of May 30, 1908 (35 Stat. L. 516), there was appropriated the sum of $83,250.50 to the State of Delaware.

Thereafter, the State of North Carolina sought payment of her interest account growing out of expenditures for the War of 1812-15, and in the Seventieth Congress, first session, a bill (S. 3097) passed the Senate, to pay the State of North Carolina her claim.

This bill was considered by the Committee on the House Judiciary, and was favorably reported by Mr. Graham on May 22, 1928, in House Report 1818, Seventieth Congress, passed the House, and matured into the act of May 28, 1928 (45 Stat. L. 959), under which the State of North Carolina was paid the sum of $118,035.89.

THE AUDIT OF THE CLAIM OF THE STATE OF VERMONT BY THE COMPTROLLER

GENERAL

The act of Congress approved June 10, 1921, commonly called the “Budget Act," established the General Accounting Office, and created the office of the Comptroller General of the United States.

In defining the powers and duties of the Comptroller General, section 312, paragraph (b) of the above-cited act, provides as follows:

“He shall make such investigations and reports as shall be ordered by either House of Congress or by any committee of either House having jurisdiction over revenue, appropriations, or expenditures."

Under the above-referred-to law, the Senate, by virtue of Senate Resolution No. 224, Seventy-third Congress, second session, “ordered” the Comptroller General to audit the account between the State of Vermont and the United States, growing out of the war with Great Britain in 1812.

The above-referred-to act of June 10, 1921, and Senate Resolution No. 224, are the first and only legislative enactments by Congress, under which the State of Vermont could procure an audit of her claim, and under the above-referred to provision of law, the claim of the State of Vermont has been audited by the Comptroller General, who has found due upon such audit, the sum of $22,868.90, as of February 28, 1935.

In the Senate resolution No. 224, the Comptroller General was further directed to apply the provision of law contained in the joint resolution of May 14, 1836 (5 Stat. 132), with respect to accepting the best available evidence, even though of secondary character. The provisions of the above resolution were particularly applicable in the Vermont case, as much original evidence had been destroyed in the burning of the Vermont statehouse.

With respect to the above audit, the Comptroller General holds that, as this audit was made by direction of a Senate resolution, and not by joint action of both Houses of Congress, the audit so made is not one that has been made by virtue of an act of Congress, and, therefore, that he is not authorized to certify the result of such audit to Congress as an estimate of appropriation, germane to a deficiency appropriation bill.

It is for the purpose of clothing the above audit with a certified status that the State of Vermont now seeks joint action by both Houses of Congress, by the passage of Serate joint resolution 89.

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