75TS CONGRESS, 1ST SESSION-CHS. 703, 704-AUGUST 19, 1937

Secretary of the Interior : And provided further, That all fees, costs,

and expenses collected by the commissioner shall be disposed of as

provided in section 11 of this Act .

SEC. 10. That all fees, costs, and expenses arising in cases under

this Act and properly chargeable to the United States shall be certified, approved, and paid as are like fees, costs, and expenses in the

courts of the United States.

SEC. 11. That all fines and costs imposed and collected shall be

deposited by said commissioner of the United States, or the marshal

of the United States collecting the same, with the clerk of the United

States District Court for the Western District of Virginia .

Approved, August 19, 1937 .

[CHAPTER 7041

AN ACT

To amend the Federal Farm Loan Act, to amend the Emergency Farm Mortgage

Act of 1933, to amend the Farm Credit Act of 1933, to amend the Federal

Farm Mortgage Corporation Act, to amend the Agricultural Marketing Act,

and for other purposes .

Be it enacted by the Senate and House o f Representatives o f the

United States of America in Congress assembled, Thai this Act, may

be cited as the "Farm Credit Act of 1937".

SEC. 2 . Section 4 (b) of the Federal Farm Mortgage Corporation

Act (U. S. C., 1934 edition, title 12, sec. 1020d) is amended by adding

at the end thereof the following new paragraph

"When in the judgment of the directors conditions justify it, the

corporation shall have power to extend, in whole or in part, any

unpaid obligation under the terms of any mortgage, and to accept

payment of any such obligation together with interest thereon, at a

rate not exceeding 5 per centum per annum, during such period and

in such amounts as may be agreed upon at the date of making such

extension."

SEC. 3. Section 31 (a) of the Emergency Farm Mortgage Act of

1933 (48 Stat. 47), as amended, is amended by striking out all prior

to the first proviso and inserting in lieu thereof the following

"(a) The Federal Farm Mortgage Corporation is authorized and

directed to make available to the Land Bank Commissioner until

July 1, 1938, out of the funds of the Corporation, the sum of

$2,000 000 to be used for the purpose of making loans to the jointstock land banks organized and doing business under the Federal

Farm Loan Act, as amended . Loans made by the Land Bank Commissioner under this section shall be made in the name and on behalf

of the Corporation and shall bear interest at a rate not to exceed 4

per centum per annum. No loan shall be made under this section

to any joint-stock land bank except for the purpose of obtaining, for

a period of one year from the date on which the loan is made, postponement of the foreclosure of first mortgages held by such bank

on account of (1) default in the payment of interest and principal

due under the terms of the mortgage, and (2) unpaid delinquent

taxes, excluding interest and penalties, which may be secured by the

lien of said mortgage :".

SEC. 4 . The first sentence of section 4 (b) of the Federal Farm

Mortgage Corporation Act, as amended (U . S . C ., 1934 edition, title

12, sec . 1020d), is amended to read as follows : "The corporation is

further authorized to purchase from time to time, for cash, such consolidated farm loan bonds at such prices and upon such terms as

may be approved by the board of directors of the corporation ; to

make loans to Federal land banks and joint stock land banks on the

703

Disposal of fees, etc.

Fees chargeable to

United States, payment of .

Deposit of fines and

costs .

August 19,1937

[H . R. 7909]

[Public, No . 323]

Farm Credit Act of

1937.

Federal Farm Mortgage Corporation .

48 Stat .348.

12 U . S . C . § 1020d .

Extension of unpaid

obligations under

terms of mortgages ;

acceptance of payment ; interest rate .

Joint-stock land

banks.

48 Stat. 47 .

12 U . S . C . § 823 ;

Supp . II, § 823.

Amount available

for loans to, by Land

Bank Commissioner .

Interest rate .

Use of money loaned .

Purchase of consolidated farm loan

bonds ; loans to Federal land banks ; security .

48 Stat . 346.

12 U . S . C . § 1020d.
704

Proviso. Limitation .

Consolidated farm

loan bonds as security.

Investment of

funds .

48 Stat . 48.

Farm credit districts ; number, boundaries, etc .

Designations

changed .

39 Stat . 372 .

Farm credit board;

selection, number .

Title to include city.

Elected directors,

selection .

District directors,

appointment .

Present land bank

directors to form farm

credit board in each

district.

Selection of successors .

Third district director, selection .

Removal from office,

restriction on renomination .

39 Stat . 375 .

12 U . S . C . § 831b .

75Ta CONGRESS, 1ST SESSION-CH. 701 AUGUST 19, 1937

security of real estate mortgages, sheriff's certificates, sales contracts

and real estate, upon such terms and conditions as shall be prescribed by the board of directors of the corporation : Provided,

however, That loans outstanding to joint-stock land banks under

this subsection shall not at any one time exceed in the aggregate

$10,000,000 ; to make loans to Federal land banks on the security of

consolidated farm loan bonds ; and to invest its funds in mortgage

loans made under section 32 of the Emergency Farm Mortgage Act

of 1933, as amended ."

SEC. 5 . (a) There shall be twelve districts in the continental

United States, excluding Alaska, which shall be known as farm credit

districts, and may be designated by number . The boundaries of the

twelve Federal land bank districts existing as of the date of enactment of this Act shall be the boundaries of the respective farm credit

districts. Such boundaries may be readjusted from time to time in

the discretion of the Farm Credit Administration, provided that

said districts shall be apportioned with due regard to the farm credit

needs of the country and no such district shall contain a fractional

part of any State . The designations "Federal land bank district"

and "land bank district" wherever used in the Federal Farm Loan

Act, or in any Act amendatory thereof or supplementary thereto, are

changed to farm credit district" and shall hereafter be deemed to

refer to the farm credit districts provided for in this section .

(b) There shall be in each farm credit district a farm credit

board, which shall be selected as hereinafter specified and shall be

composed of seven members . Each farm credit board shall include

in its title the name of the city in which the Federal land bank,

Federal intermediate credit bank, production credit corporation, and

regional bank for cooperatives of the district are located . Three of

the members of said board shall be known as elected directors of

whom one shall be chosen by national farm loan associations and

borrowers through agencies, one shall be chosen by production credit

associations of the district, and one shall be chosen by cooperatives

which are stockholders or subscribers to the guaranty fund of the

regional bank for cooperatives in the district . Three of the seven

members shall be known as district directors, of whom two shall be

appointed by the Governor of the Farm Credit Administration and

one, who shall be known as the third district director, shall be chosen

as hereafter in this section provided . The seventh member of such

board shall be known as director at large and shall be appointed

by the Governor of the Farm Credit Administration .

(c) The directors of the Federal land bank of each district who

are in office on the date of enactment of this Act shall constitute

the farm credit board of the district and shall serve as members

thereof for the remaining portions of the terms for which they were

respectively elected or appointed as directors of the bank . Except

as otherwise provided by this Act, the successor to each original

member of the farm credit board shall be selected in the manner

in which such member was selected as a director of the Federal land

bank.

(d) Each third district director shall be selected as follows : Each

national farm loan association and borrower through agencies in the

district shall nominate, in the manner provided herein for the nomination of candidates for elected directors, one candidate for such

director, and from the three persons having the greatest number of

votes as nominees the Governor of the Farm Credit Administration

shall appoint such director. No third district director who is

removed from office pursuant to section 17 (h) of the Federal Farm

Loan Act may be nominated to succeed himself.
75TH CONGRESS . 1ST SESSION-CH. 704 AUGUST 19, 1937

(e) At least two months before an election of an elected director

the Farm Credit Administration shall cause notice in writing to be

sent to those entitled to nominate candidates for such elected director .

In the case of an election of a director by national farm loan associations and borrowers through agencies, such notice shall be sent to all

national farm loan associations and borrowers through agencies in

the district ; in the case of an election by production credit associations, such notice shall be sent to all production credit associations

in the district ; arid in the case of an election by cooperatives which

are stockholders or subscribers to the guaranty fund of the bank for

cooperatives of the district, such notice shall be sent to all cooperatives which are stockholders or subscribers to the guaranty fund at

the time of sending notice . After receipt of such notice those

entitled to nominate the director shall forward nominations of residents of the district to the Farm Credit Administration . The Farm

Credit Administration shall, from the nominations received within

thirty days after the sending of such notice, prepare a list of candidates for such elected director consisting of the ten nominees

receiving the highest number of votes .

(f) At least one month before the election of an elected director

the Farm Credit Administration shall mail to each person or

organization entitled to elect the elected director the list of the ten

candidates nominated in accordance with the preceding paragraph of

this section . In the case of an election of a director by national farm

loan associations and borrowers through agencies, the directors of

each farm loan association shall cast the vote of such association for

one of the candidates on the list . In voting under this section each

such association shall be entitled to cast a number of votes equal

to the number of stockholders of such association and each borrower

through agencies shall be entitled to cast one vote. In voting under

this section each production credit association shall be entitled to

cast a number of votes equal to the number of the class B stockholders of such association . In voting under this section each cooperative which is a holder of stock in, or a subscriber to the guaranty

fund of, the bank for cooperatives shall be entitled to cast one vote .

The votes shall be forwarded to the Farm Credit Administration and

no vote shall be counted unless received by it within thirty days after

the sending of such list of candidates . In case of a tie the Farm

Credit Administration shall determine the choice. The nominations

from which the list of candidates is prepared, and the votes of the

respective voters, as counted, shall be tabulated and preserved and

shall be subject to examination by any candidate for at least one year

after the result of the election is announced .

(g) The terms of office of all directors shall be three years . Any

vacancies that may occur in the farm credit board shall be filled for

the unexpired term in the manner provided herein for the original

selection of such directors .

(h) Members of each farm credit board shall have been, for at

least two years, residents of the district for which they are appointed

or elected . From and after the date of enactment of this Act, no

person shall be eligible for election or appointment as a member of

any district farm credit board, and no person hereafter elected or

appointed as a member of any district farm credit board shall be

eligible to continue to serve as such, if in either case said person is

an officer or employee of any Federal land bank, Federal intermediate credit bank, production credit corporation, or bank for cooperatives. No district director, excepting any third district director

selected as hereinabove specified, shall, during his continuance in

office, be a director, officer, or employee of any institution, association,

125151 °-3745

Notice and procedure of nominating

elected directors

Notice and procedure for election .

Terms of office .

Qualifications .

705

Limitation on engaging in business.
706

Disqualification for

conviction of felony,

etc .

48 Stat . 257.

Compengation .

Limitation .

Land banks ;

branches.

12 U. S . 0 . § 672.

Applicability of agricultural credit laws

to territories, etc .

Farm credit boards,

powers .

Employment of

joint officers and employees for Federal

land banks, etc .

Acquisition and disposal of property .

Execution of leases,

contracts, etc.

75TH CONGRESS, IST SESSION-CH. 704-AUGUST 19,193T

or partnership engaged in the business of lending money or of making or selling land mortgage loans, except an institution or association under the supervision of the Farm Credit Administration .

(i) No person shall be eligible for appointment or election as an

administrative or executive official of a Federal lank 1 bank, Federal

intermediate credit bank, or of any corporation or bank organized

pursuant to the Farm Credit Act of 1933, or as a member of any

farm credit board, or shall continue to hold office as such member,

if such person has been finally adjudged guilty of a felony, or finally

adjudged liable in damages in any civil proceeding for fraud, in any

State or Federal court .

(j) Subject to the approval of the Farm Credit Administration

members of each farm credit board shall receive such compensation

as may be authorized by the board, including a reasonable allowance

for necessary expenses in attending meetings of said board and directors' meetings. Such compensation shall be paid by the Federal

land bank of the district, and such bank shall be reimbursed therefor

by the Federal intermediate credit bank, production credit corporation and bank for cooperatives of the district in such proportion and

in such manner as may be fixed by the farm credit board subject to

the approval of the Farm Credit Administration . Except with the

approval of the Farm Credit Administration, no member of any

farm credit board shall receive compensation or allowances for any

services rendered such institutions, in his capacity as director or

otherwise, for more than thirty days in any one calendar year, exclusive of the period for which compensation is paid for attendance

at meetings of said board and at directors' meetings .

(k) Nothing contained in this section shall be construed to abrogate or repeal the second paragraph of section 4 of the Federal Farm

Loan Act, as amended, or to affect the applicability of any other Act

of Congress under which agricultural credit laws of the United

States may be made applicable to territories or insular possessions

of the United States .

SEO. 6 . Each farm credit board provided for in this Act shall have

power, subject to the approval of the Farm Credit Administration-

(a) To employ joint officers and employees for the Federal land

bank, Federal intermediate credit bank, production credit corporation, and regional bank for cooperatives in its district . The salaries

or other compensation of all such joint officers and employees shall

be fixed by the district farm credit board and shall be paid by the

Federal land bank of the district. Such bank shall be reimbursed

therefor by the other three institutions in the district, in such

amounts and upon such conditions as the board shall determine .

Officers and employees appointed by the district farm credit board

shall be officers and employees of the district institutions served by

them.

(b) To authorize the acquisition and disposal of such property,

real or personal, as may be necessary or convenient for the transaction of the business of the Federal land bank, the Federal intermediate credit bank, the bank for cooperatives, and the production

credit corporation, located in its district, upon such terms and

conditions as it shall fix, and to prorate among such institutions the

cost of purchases, rentals, construction, repairs, alterations, maintenance, and operation, in such amounts and in such manner as it shall

determine. Any lease, or any contract for the purchase or sale of

property, or any deed or conveyance of property, or any contract

for the construction, repair, or alteration of buildings, authorized

by a district farm credit board under this subsection shall be

2 So in original.
75TH CONGRESS. 1ST SESSION-CH. 704-AUGUST 19, 1937

executed by the officers of the institution or institutions concerned

pursuant to the direction of such board. No provision of law relative to the acquisition or disposal of property, real or personal, by

or for the United States, or relative to the making of contracts or

leases by or for the United States, including the provisions set out

in title 40 and title 41 of the United States Code, 1934 edition, and

the Supplements thereto, and including rovisions applicable to

corporations wholly owned by the United - States, shall be deemed

or held applicable to any lease, purchase, sale, deed, conveyance, or

contract authorized or made by a district farm credit board, Federal

land bank, Federal intermediate credit bank, production credit

coi oration, or bank for cooperatives under this subsection . c) No corporation under the supervision of the Farm Credit

Administration, of which corporation any member of the board of

directors is elected or appointed by private interests, shall be subject

to the provisions of the Acts of Congress approved March 14, 1936

(49 Stat . 1161, 1162) (U. S . C ., title 5, sees . 29a, 30b-30m, 31a) .

SEC. 7 . (a) The first paragraph of section 4 of the Federal Farm

Loan Act, as amended (U. S . C., 1934 edition, title 12, sec. 671), is

repealed .

(b) Section 4 of the Federal Farm Loan Act, as amended, is

further amended by striking out paragraphs nine to seventeen

thereof (U. S . C ., 1934 edition, title 12, sees . 678 to 683), both inclusive and inserting in lieu thereof the following

"The members of the farm credit board of each farm credit district

provided for in the Farm Credit Act of 1937 shall be ex officio the

directors of the Federal land bank located in that district . Any

compensation that may be provided by the board of directors of any

Federal land bank for officers or employees shall be subject to the

approval of the Farm Credit Administration ."

(c) Section 23 of the Farm Credit Act of 1935 (U. S . C., 1934

edition, Supp. II, title 12, sec . 682a) is repealed .

SEC. 8 . The ninth paragraph of section 7 of the Federal Farm

Loan Act (U. S . C ., 1934 edition, title 12, sec . 719) is amended by

adding at the end thereof the following sentence : "The boundaries

of the territory designated in the charter of any national farm loan

association may be readjusted from time to time to meet the farm

loan needs of the locality, as determined by the Farm Credit

Administration ."

SEC. 9 . Section 17 (h) of the Federal Farm Loan Act (U . S . C .,

1934 edition, title 12, sec . 831) is amended to read as follows

"(h) To suspend or to remove for cause any district director

or director at large, or any registrar, appraiser, examiner, or other

official appointed by the Farm Credit Administration under authority

of section 3 of this Act, as amended, the cause of such suspension

or removal to be communicated forthwith in writing by said Administration to the person suspended or removed, and in case of a district director or director at large to the proper Federal land bank,

Federal intermediate credit bank, production credit corporation and

regional bank for cooperatives ."

SEC. 10 . Section 201 (b) of the Federal Farm Loan Act, as

amended (U. S . C ., 1934 edition, title 12, sec . 1022), is amended to

read as follows

"(b) One such institution shall be established in each farm credit

district in the same city as the Federal land bank of the district .

The members of the several farm credit boards of the farm credit

districts provided for in the Farm Credit Act of 1937 shall be ex

officio the directors of the several Federal intermediate credit banks

herein provided for and shall have power, subject to the approval

of the Farm Credit Administration, to employ and fix the comExceptions .

7 0 7

Federal vacation

and sick leave provisions inapplicable

to boards selected by

private interests .

49 Stat . 1161, 1162 .

5 U . S . C ., Supp. if,

§§ 29a, 30b-30m, 3[a .

Land bank districts;

provisions repealed .

39 Stat . 362.

12 U . S . C . § 671 .

Section superseded.

12 U . S . C . §§ 678-

683 .

Farm credit board

members ex officio

directors of land bank

in district .

Approval of compensation .

Persons disqualified; section repealed .

49 Stat . 320.

12 U . S . C ., Supp.

11, § 682a.

Readjustment of

boundaries of territory .

12 U . S. C .§719.

12 U. S . C . § 831h .

Suspension or removal of directors, etc.

12 U. S . C . § 1022 .

Federal intermediate credit banks, location .

Members of credit

boards to be ex officio

directors .

Personal services.
708

Production Credit

Corporations, etc.

48 Stat. 257.

12 U . S . C . §5 1131,

1134.

Location.

Members of credit

boards to be ex officio

directors .

Land bank loans .

12 U . S . C . § 771.

Liquidation of debts

incurred prior to January 1, 1937.

Loans b y L and

Bank Commissioner.

49 Stat. 313 .

12 U . S . C ., Supp .I1,

§ 1016 (e) .

Refinancing indebtedness incurred for

nonagricultural purPoses .

Deferment of principal payments, first

three years, if not in

default .

Purchase, etc., of

bonds .

39 St at. 372.

12 U . S. C. § 781.

Federal Farm Mortgage Corporation

bonds .

Purchase at or below par.

48 Stat. 347.

12 U . S . C . § 781 .

12 U . S . C . § 897 .

Purchase of Federal

Farm Mortgage Corporation bonds .

12 U . S . C . § 781 .

Enumerated powers .

Loans to other Federal land banks .

12 U . S . C . § 781 .

75TH CONGRESS, 1sT SESSION-CH. 701 AUGUST 19, 1937

pensation of such officers and employees ofsuch Federal intermediate

credit banks as may be necessary to carry on the business authorized

by this title ."

SEC. 11. The second and third sentences of section 2 of the Farm

Credit Act of 1933 (U . S. C., 1934 edition, title 12, sec. 1134) are

amended to read as follows : "One such corporation and one such

bank shall be established in each farm credit district in the city

in which there is located a Federal land bank. The members of the

several farm credit boards of the farm credit districts provided for

in the Farm Credit Act of 1937 shall be ex officio the directors of

the respective production credit corporations and banks for

cooperatives."

SEC. 12. Paragraph "Fourth" of section 12 of the Federal Farm

Loan Act, as amended (U . S . C ., 1934 edition, title 12, sec . 771), is

further amended by striking out "incurred prior to January 1, 1933"

from subparagraph (d) thereof, and by inserting in lieu thereof the

following : "Incurred prior to January 1, 1937" .

SEC. 13. Section 32 of the Emergency Farm Mortgage Act of

1933, as amended (U . S . C., 1934 edition, Supp. II, title 12,

sec. 1016), is further amended by striking out so much of the sixth

sentence thereof as follows the colon after the word "other", and by

inserting in lieu thereof the following : "Refinancing, in connection with proceedings under chapter VIII of the Bankruptcy Act

of July 1, 1898, as amended, any indebtedness, secured or unsecured, of the farmer, or which is secured by a lien on all or any

part of the farm property accepted as security for the loan" .

SEc. 14. The fourth sentence of section 32 of the Emergency

Farm Mortgage Act of 1933, as amended (U . S . C., 1934 edition,

Supp. II, title 12, sec . 1016), is further amended by striking out

the proviso at the end thereof and by inserting in lieu thereof the

following : "Provided, That when in the judgment of the Land

Bank Commissioner conditions justify it, any mortgage made under

this section may provide that during the first three years the loan

is in effect payments of interest only may be required if the borrower shall not be in default with respect to any other condition

or covenant of his mortgage ."

SEC. 15. (a) Paragraph "Eighth" of section 13 of the Federal

Farm Loan Act (U . S. C., 1934 edition, title 12, sec. 781) is

amended to read as follows

"Eighth. To buy and sell United States bonds and Federal Farm

Mortgage Corporation bonds."

(b) Paragraph "Fifteenth" of section 13 of the Federal Farm

Loan Act, as amended (U. S . C., 1934 edition, title 12, sec . 781)is further amended by striking out, after the word "value" in said

paragraph, the comma and the words "and to purchase Federal

Farm Mortgage Corporation bonds at or below par".

(c) Section 22 of the Federal Farm Loan Act, as amended (U . S .

C., 1934 edition, title 12, sec . 897), is further amended by inserting

under the heading "In the case of a joint-stock land bank" at the

end thereof the following

"(e) To purchase Federal Farm Mortgage Corporation bonds ."

SEC. 16. Section 13 of the Federal Farm Loan Act, as amended

(U. S . C., 1934 edition, title 12, sec . 781), is further amended by

adding at the end thereof the following paragraph

"Seventeenth . To make loans to other Federal land banks upon

such terms and conditions as may be approved by the Farm Credit

Administration ."

SEC. 17. Section 13 of the Federal Farm Loan Act as amended

(U. S. C., 1934 edition, title 12, sec . 781), is further amended by

adding at the end thereof the following new paragraph
75TH CONGRESS. 1ST SESSION-CH. 704-AUGUST 19, 1937

"Eighteenth . To accept conditional payments from borrowers for

subsequent credit upon their indebtedness to the land bank ; and to

allow interest on such payments. All conditional payments so

accepted shall be subject to such terms and conditions, not inconsistent with the provisions of this paragraph and with any rules or

regulations prescribed for its efficient execution by the Farm Credit

Administration, as may be agreed upon at the time of their acceptance . If a conditional payment is accepted for subsequent credit

upon a first mortgage which is at the time or is thereafter pledged

as collateral security for an issue of farm-loan bonds, all requirements, conditions, and limitations set forth in the seventh, eighth, and

ninth paragraphs of section 22 of this Act, as amended, shall apply to

such payment the same as though it were a present payment on the

principal of the mortgage pledged as collateral security, and the land

bank shall forthwith notify the farm loan registrar of its receipt of

such payment and account to him therefor . Every conditional payment accepted by a land bank for subsequent credit upon indebtedness of a borrower shall be credited upon such indebtedness as the

borrower may from time to time direct in accordance with the terms

and conditions upon which the payment has been accepted, and at

the option of the bank may in any event be credited upon such indebtedness as and when it natures if it is not otherwise paid by the borrower at or before maturity . If at any time after five years from the

date on which a borrower's loan was made, the aggregate of the borrower's conditional payments accepted on account of his indebtedness under such loan and not yet credited thereon equals or exceeds

his total indebtedness under the loan, all unmatured indebtedness

under such loan shall become due and payable at once, and the payments so accepted shall forthwith be credited upon the borrower's

indebtedness under the loan so far as may be necessary to pay it in

full . Any balances of conditional payments remaining uncredited

when the indebtedness on account of which they have been accepted

has been paid in full shall be refunded to the borrower by the land

bank."

SEC. 18. The seventeenth paragraph of section 21 of the Federal

Farm Loan Act, as amended (U . S . C., 1934 edition, title 12, sec.

883), is further amended by adding at the end thereof the following : "The bond committee may appoint from among their number

a subcommittee consisting of three members, to hold office for a

period of one year or until their successors have been appointed,

may from among their number fill any vacancies on the subcommittee and may dismiss at pleasure the members of the subcommittee

or any of them . The subcommittee, if appointed, shall have such

authority to exercise the powers and to perform the functions of the

bond committee as the bond committee may authorize and shall be

subject to all provisions of law relating to the duties and expenses

of the bond committee. The committee shall select one of the members of the subcommittee to be chairman and one of the members

of the subcommittee to be secretary of the subcommittee ."

SEC. 19. Paragraph "Tenth" of section 13 of the Federal Farm

Loan Act, as amended (U . S. C ., 1934 edition, title 12, sec . 781), is

further amended by striking out in the fourth sentence thereof the

following : "made prior to the expiration of five years from May 12,

1933", and adding at the end of said paragraph the following : "The

unexpended balances of the funds appropriated by the Fourth Deficiency Act, fiscal year 1933, approved June 16, 1933 (48 Stat . 279),

the Emergency Appropriation Act, fiscal year 1935, approved June

19, 1934 (48 Stat. 1060), the Second Deficiency Appropriation Act,

fiscal year 1935, approved August 12, 1935 (49 Stat. 592), the First.

Deficiency Appropriation Act, fiscal year 1936, approved June 22,

Credit allowed .

Authority, etc .

12 U . S . C . $ 781 .

709

Acceptance of conditional payments

from borrowers.

Acceptance for subsequent credit.

Application to pay

ment .

Refund of bathnces.

Land bank bond

committee ; subcommittee authorized .

12 U . S . C . § 883 .

Unexpended balances of designated

funds, repayments,

etc ., to constitute revolving fund ; use of.

48 Stat . 279, 1060 : 49

Stat . 592, 1635, 182a .
710

Ante, p. 138.

Land bank examiners ; designation

changed.

12 U . S. C . § tie.

National farm loan

association directors;

terms of office modified.

12 U . S . C. § 712.

Vacancies .

12 U . S. C . § 723 (c) .

Borrowers from land

banks may transfer,

etc ., to Farm Mortgage Corporation .

12 U . S . C . § 732 .

Farm loan association.

Voting in shareholders' meetings .

49 Stat. 319 .

12 U . S . C ., Supp .

II, § 745 .

Election of prospective borrower .

12 U . S . C . §§ 741-

745.

Common board of

directors between two

or more associations .

75TH CONGRESS, 1ST SESSION-CH. 701 AUGUST 19, 1937

1936, the Treasury Department Appropriation Act, 1937, approved

June 23, 1936, and the Treasury Department Appropriation Act,

1938, approved May 14, 1937, for the purpose of enabling the Secretary of the Treasury to make subscriptions to the paid-in surplus

of the Federal land banks, as provided for in this paragraph, and

the proceeds of all repayments on account of such paid-in surplus,

shall be held in the Treasury of the United States as a revolving

fund and shall be available for subscriptions to paid-in surplus made

pursuant to this paragraph, as amended ."

SEC. 20. Examiners appointed pursuant to the provisions of section 3 of the Federal Farm Loan Act, as amended (U . S . C ., 1934

edition, title 12, sec. 656), shall hereafter be designated and known

as farm credit examiners .

SEC. 21. The second paragraph of section 7 of the Federal Farm

Loan Act (U. S. C., 1934 edition, title 12, sec. 712) is amended by

striking out the first sentence and inserting in lieu thereof the following : "The board of directors of every national farm loan assoc,ation shall consist of not less than five nor more than seven members,

who shall be elected by the shareholders of the association . Elections of such directors shall be held once each year at an annual

meeting of the shareholders . Every national farm loan association

shall at the first annual meeting of its shareholders subsequent to the

enactment of the Farm Credit Act of 1937 elect two directors for a

term of three years, two direotors for a term of two years, and the

remainder of its board of directors for a term of one year . Thereafter directors shall be chosen to serve for terms of three years, and

the shareholders of each association shall annually elect as many

directors as may be necessary to fill the places of those directors

whose terms expire during the year . Any vacancy that may occur

in the board of directors through death, resignation or other cause

shall be filled at the next annual meeting of shareholders by the

election of a director to serve out the unexpired portion of the term,

or a special meeting of shareholders may be called for this purpose .

Until such election the remaining directors shall have power to fill

the vacancy for the time being by appointing a temporary director

to serve until the next meeting of shareholders . All directors shall

hold office until their successors are elected and have qualified ."

SEC. 22. The fourteenth paragraph of section 7 of the Federal

Farm Loan Act, as amended, (12 U. S. C., 1934 edition, title 12,

sec . 723 (c) ) is further amended by adding at the end thereof : "An

borrower's interest in such stock may be transferred or hypothecate,

by him or by operation of law, to the Federal Farm Mortgage Corporation ."

SEC. 23. Effective thirty days after the date of the enactment of

this Act, the second paragraph of section 8 of the Federal Farm Loan

Act (U. S . C ., 1934 edition, title 12, sec . 732) is amended to read as

follows

"Every shareholder shall be entitled to one vote, and no more, at

all elections of directors and in deciding all questions at meetings of

shareholders ."

SEC. 24. Effective thirty days after the date of the enactment of

this Act, the first sentence of the fifth paragraph of section 9 of the

Federal Farm Loan Act, as amended (U. S . C., 1934 edition, Supp .

II, title 12, sec . 745), is further amended by striking out the word

"two-thirds" and inserting in lieu thereof the word "majority" .

SEC. 25. (a) Section 9 of the Federal Farm Loan Act, as amended

(U. S . C ., 1934 edition, title 12, sees . 741 to 745), is further amended

by adding at the end thereof the following new paragraphs

"Any other provisions of law to the contrary notwithstanding . two

or more national farm loan associations may with the approval of
75TH CONGRESS, 1ST SESSION-CH. 704-AUGUST 19, 1937

the Farm Credit Administration, and by an agreement not inconsistent with airy rules and regulations prescribed by the said Administration, provide for a common board of directors to be elected by

the shareholders of the associations that are parties to the agreement : Provided, however, That each member of any such board shall

be a shareholder in an association that is a party to the agreement

and shall be a bona fide resident of the territory within which such

association is authorized to do business : And provided further, That

no such agreement shall provide for a term of office in excess of three

years for any member of such board . The number of members of

the common board of directors shall be specified in the agreement

and shall be five or more . The agreement may provide that any

director may be elected by the shareholders of one or more of the

associations which are parties to the agreement ; that in the balloting

for any director an association may vote at a separate meeting of its

shareholders or at a joint meeting with the shareholders of any other

association or associations participating in the election of the director ; and that the candidate receiving the highest aggregate number

of votes at such meeting or meetings shall be declared elected . Whenever two or more national farm loan associations have entered into

such an agreement, the members of the common board of directors

provided for in the agreement shall be ex officio the members of the

board of directors of each association that is a party to the agreement, any provisions of this Act to the contrary notwithstanding .

"Whenever a national farm loan association has entered into such

an agreement., the power of approving applications for loans through

the association and the power of admitting persons to membership

in the association shall be vested in the loan committee of the association in lieu of being vested in its board of directors . The loan

committee of any such association shall be elected annually by the

shareholders of the association, instead of by its board of directors,

and the shareholders shall in addition annually elect two alternates

to serve as members of the loan committee at such times as regular

members may be absent or disqualified."

(b) Whenever it shall appear that the capital stock of a national

farm loan association is impaired, the Farm Credit Administration

may authorize the Federal land bank of the district in which such

association is located to make loans to applicants through such

association subject to the requirements and conditions specified for

direct loans in paragraphs 12 to 16, both inclusive, of section 7 of

the Federal Farm Loan Act, as amended (U . S . C., 1934 edition,

title 12, sec . 723), except as herein otherwise specifically provided,

and may authorize such association to elect to membership borrowers

having loans made pursuant to said paragraphs on lands situated

within the chartered territory of the association . Borrowers

admitted to membership in the association pursuant hereto shall

be entitled to vote and hold office in the association and the rate of

interest on their loans shall be one-fourth of 1 per centuin per

annum less than the rate of interest provided at such time for direct

loans . The association shall endorse all such mortgage loans but

it shall not become liable therefor except as hereinafter provided .

When there are ten or more borrowers admitted to membership

in an association pursuant hereto whose loans are in good standing,

as defined by the Farm Credit Administration, and aggregate not

less than $20,000

First. The association shall become liable for the payment

of said loans : Provided, however, That, any other provisions of

law to the contrary notwithstanding, the shareholders who have

become members pursuant to this subsection shall not be held

responsible, through the amount paid in and represented by

7 1 1

Provisos. Board members to

be shareholders and

residents of territory.

Term of office, restriction .

Number.

Balloting .

Members of common board to be ex

officio directors of

each association .

Power to approve

loans, admitting persons to membership

vested in loan committee .

Annual elections.

Loans where stock

of farm loan association is impaired .

12U .s .C .$ 723 .

New borrowers as

members ; voting privileges, etc .

Endorsement of

mortgage loans; liability .

Admission to association membership of

ten or more borrowers .

Liability for paying

loans.

Proviso . Individual responsibility of shareholders.
712

Reduction of interest rate.

Exchange of stock .

12 U. S. C . 1 723 (d) .

Admission of new

members, etc.

Election of loan

committee from stockholders.

Proviso .

Admission, where

stockholders fail to

elect loan committee.

Segregation of records, accounts, etc.

Special provisions .

75TH CONGRESS, 1sT SESSION-CH. 704--AUGUST 19, 1937

their shares or otherwise, for any contracts, debts, or engagements of the association entered into before the date on which

the first member was admitted to the association pursuant to

this subsection and the shareholders of such association who

were members prior to said date shall not be held responsible,

through the amount paid in and represented by their shares

or otherwise, for any mortgages endorsed by such association

on or after said date, but this provision shall not be construed

to relieve any other liability with respect to stock held by

shareholders who were members prior to said date .

Second. The interest rate paid by each such borrower on each

such loan shall, beginning with the next regular installment date,

be reduced one-fourth of 1 per centum per annum .

Third. The stock in the Federal land bank held by each of

said borrowers shall be exchanged for association stock in the

manner provided for in paragraph 15 of section 7 of the Federal

Farm Loan Act as amended (U . S . C ., 1934 edition, title 12, sec.

723, subset . (d) j .

Fourth. The association may thereafter admit new members,

endorse their loans, and become liable for the payment of such

loans as provided in paragraph "First" of this subsection .

Fifth . At the next annual meeting of stockholders, and thereafter, the loan committee of such association may be elected by

the members who become stockholders pursuant to this subsection and any loan committee so elected shall have the powers

specified for loan committees elected as provided in subsection

(a) of this section : Provided, however, That in the event such

stockholders fail to elect the loan committee, new members shall

be admitted to the association as otherwise provided in the

Federal Farm Loan Act, as amended.

Sixth . In accordance with rules and regulations prescribed by

the Farm Credit Administration, the association shall maintain

separate capital-stock records ; shall keep all capital losses or

gains reserves (including legal reserves), and dividends receivedd from the Federal land bank on stock owned by the association in connection with loans for which it becomes liable as

provided in this subsection separate and apart from capital losses

or gains, reserves (including legal reserves), and dividends

received from the Federal land bank on stock owned by the

association in connection with other loans of the association ;

and shall segregate any undivided profits of the association

resulting from its business operations in like manner when so

required by rules and regulations of the Farm Credit Administration. Subject to the other provisions of the Federal Farm

Loan Act with respect to the declaration of dividends, dividends

may be declared exclusively on association stock owned by

borrowers with loans for which the association becomes liable

as provided in this subsection or exclusively on association stock

owned by borrowers with other loans through the association .

If the loan of any borrower who was admitted to membership pursuant hereto is not in good standing at the time when there are ten

or more borrowers with loans aggregating not less than $20,000 which

are in good standing, the provisions of paragraphs "First", "Second",

and "Third" of this subsection shall be applicable to his loan at such

time as it shall be placed in good standing .

If and when all impairment is removed in the stock owned by shareholders with loans which were made prior to the date on which the

first member was admitted to the association pursuant to this sub-
75TH CONGRESS, 1ST SESSION-CH. 704-AUGUST 19, 1937

section, the holders of such stock and the holders of stock issued on

and after said date may, pursuant to rules and regulations of the

Farm Credit Administration and consistent with the provisions of

the Federal Farm Loan Act, as amended, agree as to the rights,

powers, privileges, duties, and liabilities which shall thenceforth

attach to their respective shares of stock and otherwise agree as to the

future applicability, if any, of the special provisions contained in

this subsection .

(c) Section 11 of the Federal Farm Loan Act, as amended (U . S .

C., 1934 edition, title 12, sec . 761), is amended by adding a paragraph

at the end thereof reading as follows

"Fifth. Whenever a Federal land bank shall have empowered any

national farm loan association of its district to collect and pay over

to said bank the dues, interest, amortization installments, and other

sums payable under the terms, conditions, and covenants of the

mortgages taken from its shareholders, such association may, with

the approval of said bank, enter into an agreement with another

association operating in the same or adjacent territory to make such

collections, for and on behalf of the association thus empowered to

do so, on any or all of said loans, and immediately pay the amounts

so collected to said land bank . Such agreements shall be made upon

such terms and conditions and for such consideration as may be

ap roved by the Farm Credit Administration ."

((d) Section 29 of the Federal Farm Loan Act, as amended (U . S .

C., 1934 edition, title 12, sets. 961-966), is further amended by adding at the end thereof the following new paragraphs

Upon receiving satisfactory evidence that any national farm loan

association has failed to meet its outstanding obligations of any

description, and that it will be to the best interests of its creditors

and stockholders for the association to continue in business, the Farm

Credit Administration may, in its discretion, in lieu of appointing a

receiver as hereinabove in this section provided, appoint a conservator

for such association and require of him such bond and security as the

Administration may deem proper . The person so appointed shall be

a land bank appraiser appointed under the authority of section 3 of

this Act : Provided, however, That. the Farm Credit Administration

may, in its discretion, appoint some other qualified person . Any

land bank appraiser appointed as a conservator shall serve without

any additional compensation . Any other person appointed as a

conservator shall receive such compensation as the Farm Credit

Administration may authorize . Such compensation and all necessary and proper expenses of any such conservatorship shall be paid

out of the assets of such association and shall be a lien thereon

which shall be prior to any other lien .

"The conservator, under the direction of the Farm Credit Administration, may, when directed so to do, take possession of the books,

records, and assets of every description of such association, and take

such action as may be necessary to conserve such assets pending final

determination of the financial condition of the association and the

conditions under which it may be permitted to continue in business .

Such conservator shall at the earliest practicable date make such

investigations as shall be necessary to enable him to prepare an

accurate report on the financial condition of such association . In

preparing such report he shall value the association's assets and determine its indebtedness : Provided, That in determining said indebtedness contingent liabilities incurred by the association under the

provisions of this Act on endorsed mortgages shall be estimated and

included as a debt . Oil the basis of said evaluation of the associa713

12 U . S . 0 . § 761 .

Servicing loans ;

agreement between local associations .

Terms and conditions .

12 [". S . C. §§ 961-

966.

Failure of national

farm loan association

to meet obligations .

Conservator ; appointment, qualifications, etc .

Ante, p . 703 .

Proviso . Appointment, other

than appraiser.

Compensation.

Authority of conservator .

Investigations and

report .

Proviso . Contingent liabilities to he included .
714

Submission of report

district Fedor., land bank .

Decision as to settlement .

New members .

Ante, p. 711 .

Termination of eonservatorship if in the

affirmative .

Procedure, if decision in the negative .

Condition of settlement.

Payments from retired stock.

Procedurewberefair

book value of stock

below par.

75TH CONGRESS, 1ST SESSION-CH . 704-AUGUST 19, 1937

tion's assets and indebtedness, the conservator shall determine the

fair book value of the outstanding stock of said association and the

claims of any retired shareholders based on their previous stock

ownership. Upon its completion said report shall be submitted to the

Federal land bank of the district and said bank shall thereupon indicate its approval thereof or note any exceptions thereto and submit

such report together with its exceptions, if any, to the Farm Credit

Administration for consideration .

"If said report is approved, in whole or in part, by the Farm

Credit Administration, upon recommendation of the Federal land

bank of the district said Administration shall then decide whether

such association shall be permitted to pay off and retire its capital

stock at its fair book value, upon full payment of the mortgage

loans in connection with which such stock was issued originally, and

to settle on the same basis the claims of any of its stockholders who

have previously paid their loans in full, but have not received credit

for, or the proceeds of their stock in such association. At the same

time the Farm Credit Administration shall also decide whether it

will permit said association to admit new members pursuant to

section 25 (b) of the Farm Credit Act of 1937. If the decision of

said Administration is in the affirmative, it may terminate the conservatorship and turn the affairs of the association back to its board

of directors. If said report is not approved or the decision of said

Administration is in the negative, it may, in its discretion, terminate

the conservatorship and permit such association to resume the transaction of its business subject to such terms, conditions, restrictions,

and limitations as it may prescribe for the protection of the rights

of creditors and stockholders, or said Administration may appoint

a receiver for the association as elsewhere provided in this section .

"Any settlement made with a retiring or retired shareholder on

the basis of the fair book value of the stock of the association

pursuant to this section shall be made only on condition that said

shareholder agrees to accept such settlement as payment in full . If

any shareholder or former shareholder does not desire to settle on

such basis, he may, in lieu thereof, be given a participation certificate

which will entitle him to share pro rata, on the basis of the number

of shares of stock which he owned in the association, in the distribution of any assets of the association which is made after all of its

indebtedness to creditors has been satisfied . The Federal land bank

of the district may pay to the association from the proceeds of bank

stock retired in connection with the payment in full of loans endorsed

by such association an amount sufficient to permit the association to

make the settlements provided for in this section and any balance

of such proceeds shall be retained by the bank and applied as a credit

on the indebtedness of the association to it .

"After any determination by the Farm Credit Administration

as herein provided, that the fair book value of the stock of a national

farm loan association is less than the par value thereof, periodically

thereafter any increase in the fair book value of said stock resulting

from earnings of the association and actual recoveries in excess of the

valuations used by the Farm Credit Administration in determining

the fair book value of the stock of such association, as herein

provided, shall, under rules and regulations of the Farm Credit

Administration, be apportioned ratably on a per-share basis to all

outstanding stock or participation certificates having a fair book

value less than par until the fair book value of all such stock or

participation certificates is equal to the par value thereof .
75TH CONGRESS, 1sT SESSION-CH . 704-AUGUST 19, 1937

"In the event that the indebtedness, as determined by the conservator, of an association which has been under conservatorship

pursuant to this section increases in excess of the earnings of such

association, the Farm Credit Administration may, in its discretion,

again appoint a conservator for the association, or it may appoint

a receiver as elsewhere provided in this section ."

SEC. 26. Section 201 (c) of the Federal Farm Loan Act, as amended

(U. S. C., 1934 edition, title 12, sec. 1023), is amended by adding

to the end thereof the following paragraph

"Each Federal intermediate credit bank shall have power to

acquire and dispose of such property, real or personal, as may be

necessary or convenient for the transaction of its business, which,

however, may be leased to others for revenue purposes ."

SEC. 27. Section 203 (a) of the Federal Farm Loan Act, as

amended (U. S . C., 1934 edition, Supp . II, title 12, sec . 1041), is

further amended by striking out the comma after the word "banks"

and the following : "when chartered and established," ; and by

inserting after the comma which follows the word "cash," the

following : "United States Government bonds, Federal Farm

Mortgage Corporation bonds," .

SEC. 2S . Section 203 (b) of the Federal Farm Loan Act, as

amended (U. S . C ., 1934 edition, title 12, sec . 1042), is amended to

read as follows

"(b) The provisions of title I of this Act relating to the preparation and issue of farm loan bonds shall, so far as applicable, govern

the preparation and issue of debentures or other such obligations

issued under the preceding section ; but the Farm Credit Administration shall prescribe rules and regulations governing the receipt,

custody, substitution, and release of the cash, obligations of the

United States Government, and notes or other obligations securing

such debentures, the right of substitution being hereby granted, and

in the event such notes or other obligations are secured by warehouse

receipts, shipping documents, or other similar credit instruments,

may permit the substitution of trust receipts therefor in such manner

and subject to such conditions as may be approved by the said

Administration. Rates of interest upon debentures and other such

obligations issued under the preceding section shall, subject to the

approval of the Farm Credit Administration, be fixed by the Federal

intermediate credit bank making the issue, not exceeding 6 per

centum per annum ."

SEC. 29 . Section 204 (c) of the Federal Farm Loan Act, as

amended (U . S . C., 1934 edition, title 12, sec . 1053), is amended to

read as follows

"(c) Subject to the approval of the Farm Credit Administration,

a Federal intermediate credit bank may buy for its own account any

debentures or similar obligations issued by or for the benefit and

account of such bank or other Federal intermediate credit bank or

banks, and (1) hold until maturity any such debentures or similar

obligations or (2) retire before maturity any such debentures or

similar obli ations issued by it or for its benefit and account ."

SEC. 30 . Section 206 (b) of the Federal Farm Loan Act, as amended

(U. S. C ., 1934 edition, title 12, sec . 1072) is further amended to read

as follows :

"(b) Subject only to review and approval by the Farm Credit

Administration, each Federal intermediate credit bank, at the end

of its fiscal year, after all its necessary expenses and costs of operation for such fiscal year have been paid or provided for, shall apply

its net earnings then remaining, first, to making up any losses in

715

Action where indebtedness increases

in excess of earnings.

Federal intermediate credit banks .

42 Stat . 1454.

12 U . S . C . § 1023.

Acquisition and disposal of property .

42 Stat . 1456.

12 U . S . C ., Supp .

II, § 1041 .

Collateral security

for debentures .

42 Stat .1456.

12 U .S . 0 .§1042 .

Debentures, etc.,

preparation and issue ;

regulations governing

collateral .

Interest rates.

42 Stat . 1456 .

12 u. s . C. § 1053.

Purchase, for own

account .

42 Stat . 1457 .

12 U . S . C . § 1072 .

Disposition of annual earnings .
716

Elimination of impairment; creation of

reserves .

Amount as franchise

tax ; surplus account .

Use of franchise tax

payments.

Liquidation, etc . ;

disposition of surplus .

49 Stat . 316 .

12 U . S . C ., Supp .

II, § 1095.

Reports on condition of institutions

receiving loans, etc.

Regional agricultural credit corporations .

Powers, etc ., conferred.

47 Stat . 711 .

12 U. S . C . § 1148 .

Transaction of business in any State, etc.

Borrowingof

money ; security .

Loans .

Assets, sale and purchase of; liabilities .

75TH CONGRESS, 1ST SESSION-CH. 704-AUGUST 19, 1937

excess of its reserves against unforeseen losses and assets of doubtful value ; second, to the elimination of any impairment of its paid-in

capital and paid-in surplus ; third, to the creation and maintenance

of reserves against unforeseen losses and assets of doubtful value

in such amount as its board of directors may prescribe ; fourth, to

the payment of 25 per centum of the amount then remaining to the

United States as a franchise tax ; and, fifth, to the payment of the

remaining net earnings into its surplus account . The amounts paid

as franchise taxes to the United States by Federal intermediate

credit banks shall, in the discretion of the Secretary of the Treasury,

be used to supplement the gold reserve held against outstanding

United States notes, or shall be applied to the reduction of the outstanding bonded indebtedness of the United States under regulations

to be prescribed by the Secretary of the Treasury . Should a Federal

intermediate credit bank be dissolved or go into liquidation, after

the payment of all debts and other obligations as hereinbefore provided, any surplus remaining shall be paid to and become the property of the United States and shall be similarly applied ."

SEC. 31. Section 208 (e) of the Federal Farm Loan Act, as amended

(U. S. C ., 1934 edition, Supp. II, title 12, sec . 1095), is amended to

read as follows :

"(e) The executive departments, boards, commissions, and independent establishments of the Government, the Reconstruction

Finance Corporation, the Federal Deposit Insurance Corporation, the

Comptroller of the Currency, the Board of Governors of the Federal

Reserve System, and the Federal Reserve banks are severally authorized under such conditions as they may prescribe, upon the request of

the Farm Credit Administration to make available to the Farm

Credit Administration or any district bank or district corporation

operating under its supervision, in confidence, all reports, records or

other information they may have relating to the condition of any

institution to which the Administration, such district bank, or corporation has made or contemplates making loans or for which it has

discounted or contemplates discounting paper, or which it is using or

contemplates using as a custodian of securities or other credit instruments, or as a depositary ."

SEC. 32. Each regional agricultural credit corporation, created

under the authority of section 201 (e) of the Emergency Relief and

Construction Act of 1932 (U. S . C., 1934 edition, title 12, sec . 1148),

in addition to the powers heretofore granted, shall have and, upon

order or approval of the Farm Credit Administration, shall exercise

the following rights, powers, and authority

(a) To conduct, transact, and operate its business in any State

in the continental United States, in the District of Columbia, and

in Puerto Rico.

(b) To borrow money (other than by way of discount) from any

other regional agricultural credit corporation, the Reconstruction

Finance Corporation, or any Federal intermediate credit bank, and

to give security therefor .

(c) To lend any of its available funds to any other regional

agricultural credit corporation at such rates of interest and upon

such terms and conditions as may be approved by the Farm Credit

Administration .

(d) To sell to or purchase from any other regional agricultural

credit corporation or any corporation formed by consolidation or

merger as provided in section 33 of this Act, any part of or all

the assets of any such corporation, upon such terms and conditions

as may be approved by the Farm Credit Administration, including

the assumption of the liabilities of any such corporation, in whole

or in part .
75TH CONGRESS. 1ST SESSION-CH. 704-AUGUST 19, 1937

SEC. 33. (a) The Farm Credit Administration shall have the

power and authority to order and effect the consolidation or merger

of two or more regional agricultural credit corporations, on such

terms and conditions as it shall direct .

(b) The Farm Credit Administration is authorized to grant

charters to, prescribe bylaws for, and fix the capital of, regional

agricultural credit corporations which may be formed by the consolidation of two or more regional agricultural credit corporations,

and to approve or prescribe such amendments to the charter and

bylaws of any regional agricultural credit corporation as it may from

time to time deem necessary . Corporations formed by the consolidation of two or more regional agricultural credit corporations,

as herein provided, shall have all the rights, powers, authority, and

exemptions ; shall be subject to the same supervision and control ;

and shall have their expenses paid in the same manner as provided

by law in respect to regional agricultural credit corporations organized under section 201 (e) of the Emergency Relief and Construction

Act of 1932 .

SEC. 34. Nothing contained in sections 32 and 33 of this Act shall

be construed as limiting the rights, powers, and authority heretofore

granted to the regional agricultural credit corporations, the Farm

Credit Administration, or the Governor thereof by any Acts of Congress or Executive orders .

SEO. 35 . Section 34 of the Farm Credit Act of 1933, as amended

(U. S . C., 1934 edition, Supp . II, title 12, sec . 1134j), is further

amended to read as follows

"SFc. 34. Subject to such terms and conditions as may be prescribed

by the chairman of its board of directors, the Central Bank is

authorized : (a) to make loans to cooperative associations as defined

in the Agricultural Marketing Act, as amended, for any of the purposes and subject to the conditions and limitations set forth in such

Act, as amended ; (b) to make loans (by way of discount or otherwise) to banks for cooperatives organized under section 2 of this

Act ; (e) to buy from, and sell to, any such bank or any Federal intermediate credit bank any note, draft, bill of exchange, debenture, or

other obligation, or any interest therein ; and (d) to borrow from,

and discount or rediscount paper with, any and all such banks and

commercial banks."

SEC. 36. Section 41 of the Farm Credit Act of 1933, as amended

(U. S . C., 1934 edition, Supp . II, title 12, sec . 1134c), is further

amended to read as follows :

"Sac. 41 . Subject to such terms and conditions as may be prescribed

by the Farm Credit Administration, the banks for cooperatives are

authorized (a) to make loans to cooperative associations as defined

in the Agricultural Marketing Act, as amended, for any of the purposes and subject to the conditions and limitations set forth in such

Act, as amended ; (b) to make loans (by way of discount or otherwise) to any bank organized Lender this Act ; (c) to buy from, and

sell to, any such bank or any Federal intermediate credit bank any

note, draft, bill of exchange, debenture, or other obligation, or any

interest therein ; and (d) to borrow from, and discount or rediscount

paper with, any and all such banks and commercial banks ."

SEC. 37. Section 4 of the Agricultural Marketing Act, as amended

(U. S . C., 1934 edition, title 12, sec . 1141b), is further amended by

adding at the end thereof the following new subsection

"(7) may sell at public or private sale to the highest responsible

bidder, upon such terms and after such public advertisement as the

Farm Credit Administration may deem in the public interest, any

property, real or personal, or any interest therein, acquired by the

717

Consolidation or

merger of regional

agricultural credit corporations .

Authority to grant

charters, fix capital,

etc.

Rights, powers, etc.,

of consolidated corporations .

47 Stat. 711 .

12 U. S . C .§1148.

Rights of regional

corporations not curtailed .

49 Stat . 317 .

12 U . S . C ., Supp .

II, § 1134j .

Central Bank for

Cooperatives .

Lending powers, etc.

Security transactions authorized .

Borrowing, etc.,

powers .

49 Stat . 316 .

12 U. S. C., Supp .

11, § 1134c.

Banks for cooperatives, loans by, to

cooperative associa.

dons, etc.

Security

transactions authorized .

Borrowing, etc .,

powers.

46 Stat. 13 .

12 ti . S . C .§1141b .

Farm Credit Administration .

Sale of property

acquired on account

of loans .
718

Lease, pending sale .

Proviso .

Purchases, etc.

R . S . § 3709 .

41U .S .C .§5.

46 Stat . 14.

12 U . S. C. § 1141d.

Revolving fund,

designated funds

covered into.

"Debenture" and

"debentures" defined.

Separability provision.

Right to amend, etc.

AN ACT

August 19, 1937

[a . R. 79531 - To provide for studies and plans for the development of reclamation projects on

[Public, No . 324] the Cimarron River in Cimarron County, Oklahoma ; the Washita River in

Oklahoma, and the North Canadian River in Oklahoma .

Be it enacted by the Senate and House o f Representatives o f the

United States o f America in Congress assembled, That the Secretary

of the Interior is hereby authorized (a) to conduct surveys and investigations in order to determine the feasibility and economic usefulness

of the development of reclamation projects embracing certain lands

in the Washita River Basin in Oklahoma, and certain lands in the

North Canadian River Basin in Oklahoma, and certain lands in the

Cimarron River Basin, Cimarron County Oklahoma, and (b) if

such development is determined to be feasible and economically useful, to prepare cost of estimates and designs for the construction of

dams at such sites and such additional or incidental facilities as are

necessary to carry out such development .

SEc. 2 . That any funds appropriated providing for surveys under

the Reclamation Act may be used to carry out the provisions of this

Act.

Approved, August 19, 1937 .

Reclamation projects, Oklahoma.

Surveys authorized

for development of.

Washita River Basin.

North Canadian

River Basin .

Cimarron River Basin.

Dams .

Funds available.

75TH CONGRESS, 1sT SESSION-CHS . 704, 705-AUGUST 19, 1937

United States on account of or as a result of any loans made from

the revolving fund authorized by section 6 of this Act, as amended ;

may lease any such property, pending its sale, on such terms and

for such period, not in excess of five years, as the Farm Credit

Administration may deem in the public interest ; and may incur and

pay, from the said revolving fund, obligations and expenses for the

operation, upkeep, maintenance, repair, disposition, insurance, and

protection of any such property : Provided, That section 3709 of the

Revised Statutes shall not be construed to apply to any purchase or

service on account of such property."

SEC. 38. Section 6 of the Agricultural Marketing Act, as amended

(U. S . C., 1934 edition, title 12, sec . 1141d), is further amended by

adding at the end thereof the following : "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 ."

SEC. 39. The terms "debenture" and "debentures", when used in

any Act of Congress, whenever enacted, except the Federal Farm

Loan Act, relating to the purchase, sale, or use as security, of

debentures issued by or for the benefit and account of any Federal

intermediate credit bank or banks, shall be deemed to mean debentures issued by any such bank individually and consolidated debentures issued by such banks acting together .

SEc. 40. (a) If any provision of this Act, or the application

thereof to any person or circumstances, is held invalid, the remainder

of the Act, and the application of such provisions to other persons

or circumstances, shall not be affected thereby .

(b) The right to alter, amend, or repeal this Act is hereby

expressly reserved .

Approved, August 19, 1937.

[CHAPTER 7051