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COMMITTEE ON APPROPRIATIONS

EDWARD T. TAYLOR, Colorado, Chairman CLARENCE CANNON, Missouri

JOHN TABER, New York CLIFTON A. WOODRUM, Virginia

ROBERT L. BACON, New York JOHN J. BOYLAN, New York

RICHARD B. WIGGLESWORTH, Massachusetts LOUIS LUDLOW, Indiana

WILLIAM P. LAMBERTSON, Kansas THOMAS S. MCMILLAN, South Carolina D. LANE POWERS, New Jersey MALCOLM C. TARVER, Georgia

J. WILLIAM DITTER, Pennsylvania JED JOHNSON, Oklahoma

ALBERT E. CARTER, California J. BUELL SNYDER, Pennsylvania

ROBERT F. RICH, Pennsylvania WILLIAM B. UMSTEAD, North Carolina CHARLES A. PLUMLEY, Vermont WILLIAM R. THOM, Ohio

EVERETT M. DIRKSEN, Illinois
JOHN F. DOCKWEILER, California

ALBERT J. ENGEL, Michigan
JAMES MCANDREWS, Ilinois
EMMET O'NEAL, Kentucky
GEORGE W. JOHNSON, West Virginia
JAMES (1. SCRUGHAM, Nevada
JAMES M. FITZPATRICK, New York
LOUIS C. RABAUT, Michigan
JOACHIM O. FERNANDEZ, Louisiana
MILLARD F. CALDWELL, Florida
DAVID D. TERRY, Arkansas
JOHN M. HOUSTON, Kansas
J. BURRWOOD DALY, Pennsylvania
JOE STARNES, Alabama
ROSS A. COLLINS, Mississippi
CHARLES H. LEAVY, Washington
WILLIAM D. MCFARLANE, Texas
JOSEPH E. CASEY, Massachusetts

MARCELLUS C. SHEILD, Clerk

SUBCOMMITTEE ON DEFICIENCIES

EDWARD T. TAYLOR, Colorado, Chairman CLIFTON A. WOODRUM, Virginia

JOHN TABER, New York JOHN J. BOYLAN, New York

ROBERT L. BACON, New York CLARENCE CANNON, Missouri

RICHARD B. WIGGLESWORTH, Massachusetts LOUIS LUDLOW, Indiana THOMAS S. MCMILLAN, South Carolina J. BCELL SNYDER, Pennsylvania

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APPROPRIATIONS-CROP PRODUCTION AND HARVESTING

LOANS; ADMINISTRATION OF SUGAR ACT OF 1937

(H. J. Res. 571)

HEARINGS CONDUCTED BY THE SUBCOMMITTEE, MESSRS.

EDWARD T. TAYLOR (CHAIRMAN), CLIFTON A. WOODRUM, JOHN J. BOYLAN, CLARENCE CANNON, LOUIS LUDLOW, THOMAS S. MCMILLAN, J. BUELL SNYDER, JOHN TABER, ROBERT L. BACON, AND RICHARD B. WIGGLESWORTH, OF THE COMMITTEE ON APPROPRIATIONS, HOUSE OF REPRESENTATIVES, IN CHARGE OF DEFICIENCY APPROPRIATIONS, ON THE DAYS FOLLOWING, NAMELY:

JANUARY 19, 1938.

FARM CREDIT ADMINISTRATION

STATEMENTS OF S. M. GARWOOD, PRODUCTION CREDIT COM

MISSIONER, AND PEYTON R. EVANS, GENERAL COUNSEL

FARMERS' CROP PRODUCTION AND HARVESTING LOANS, FISCAL YEARS

1938 AND 1939

The CHAIRMAN. We have a Budget estimate for crop loans submitted in House Document No. 479.

If you care to make some preliminary statement concerning the matter you may do so.

Mr. Garwood. As to the legal part of this, Mr. Chairman, I would like to have our general counsel, Mr. Evans, tell you the whys and wherefores. I can answer on the administrative problem.

The CHAIRMAN. Do you desire to have him tell us the whys and wherefores first?

Mr. GARWOOD. Yes, sir.
The CHAIRMAN. All right, sir. Proceed.

Mr. EVANS. Last year, Mr. Chairman, Congress passed the usual crop-feed and seed-loan bill, and the title to the bill read as follows: "To provide for loans to farmers for crop-production ahd harvesting purposes during the year 1937, and for other purposes.”

The body of the act did not contain any limitations as to time in making these loans. Had it not been for the title, there would have been no question that the law could have been used continually until Congress saw fit to repeal it.

Mr. CANNON. It is well established, is it not, that the title has no force and effect?

Mr. Evans. That is true.
Mr. CANNON. And that the text governs.
Mr. Evans. That is perfectly true.

When the appropriation act was passed, the appropriation contained the title, and also referred to the payment of expenses

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Mr. CHAIRMAN. The act is limited by the amount that was authorized.

Mr. Evans. That is right, and the history of the law cast a serious doubt on whether or not it was intended by Congress that this should be a continuing law, or whether it should be confined to the calendar year 1937. Part of the appropriation was to be left available until July 1, 1938, for the payment of expenses.

Due to the uncertainty of the situation, I discussed the matter with Mr. Shield, with the General Accounting Office, and with the Bureau of the Budget, and it was felt that there was a serious question as to whether the power to lend did not cease and determine as of December 31, 1937.

For that reason it was deemed advisable to make specific provisions for continuing the appropriation after January 1938, and it is for that purpose that we are here this morning. A resolution has been drafted

The CHAIRMAN. You do not seek to have it unlimited or in perpetuity?

Mr. Evans. Not in perpetuity.

Mr. Canson. I notice that you have recommended a limitation in this provision be made for the period July 1, 1938, to June 30, 1939.

Mr. Evans. Yes, sir. If the resolution is adopted as it was sent up in the President's message, the appropriation and the right to make loans will cease and determine as of July 1, 1939.

May I say that the legal situation as it developed makes it a matter of appropriation rather than of substantive law, so this resolution would merely make the appropriation available longer than it was originally provided.

Mr. CANNON. The act of January 29, 1937, undoubtedly is a continuing act. In paragraph (c) of section 2, Mr. Chairman, as the clerk has just pointed out, there is specific language that bears that out. Here is the section:

No loan made under the provisions of this act to any borrower shall exceed $-100, por shall a loan be so made in any calendar year which, together with the unpaid principal on prior loans so made to such borrower in that year shall exceed $400 in amount.

So it is very evident that the act of January 29, 1937, does not expire and this would make the latter part of the suggested provision in the budget estimate extending the act of January 29, 1937, until June 30, 1939, unnecessary. That would be superfluous, would it not?

Mr. EVANS. That would be superfluous, if you want to leave the original law in its present form.

Mr. CANNON. All we need to do is extend the money. Of the original fund, how much is now available?

Mr. GARWOOD. Here is the detail, in these tables. I do not know how much of that you wish me to go into, but that will cover everything that I can say.

Answering the question as to the amount available, as of December 31, there was $32,000,000 available, and there will be collected during this year approximately $2,500,000 in time to be reloaned in 1938. That gives the Administration a total of $34,500,000 for loans.

The annual cost of handling the crop loan system is approximately $4,000,000.

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