# Appendix — Alabama Power Co. v. Ickes

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 1938
- **Citation:** 302 U.S. 464

## Text

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APPENDIX »
TABLE OF CONTENTS
A. Aots of Congress:
1. Title II of Nation#i Industrial ‘Recovery Act (c. 90,

2. Emergency Appropriation Act, Fiscal year 1935 (c. 648
EE
3. Emergency Relief Appropriation Act of 1935 (c. 48, 49
EEE ee ee
: & First Deficiency App ppropriation Act, Fiscal year 1936
(c. 689, 49 Stat. 1597, 1608, 1609) __......._------
5. Public Works Administration Extension Act of 1937
(Public Res _ {Noi 47, 75th Cong.) -_-__------ Rawat

. B, Executive Orders:

_ 1. No. 6174, June 16, 1933_______._-....------------

Oia ok hnann a nnenenscece-oe

3. No. 6252, August 19, 1933___..-___._-__.__________

- 4. No. 6929, December 26, 1934__.....-___._.-__------

5. No. 7064, June 7, 1935_ Te i aap emnanenes

©. State Legislation:
. 1. Alabama Acts, Extra Session, 1933, No. 107_._____---
2. South Carolina Acte,1933, No. 299___..__..___-----

|) 8. South Carolina Acts, 1984, yn ----4.-.-.--.-

D. Legislative History:

1. Intent of Congress with iain to Nieeaiaiined proj-
_ ects, as shown by legislative history of Emergency
' Relief Appropriation Act, 1935____......_._,--- 2.

2. Interpretation of the words “‘work under each particu-
lar project” in the 1935 Act............--.------:

3. The ‘provision relating to the Public Works A

|

e ‘tration contained in the’ First Deficiency Appro- -

priation Act, Fiscal year 1936; Debates thereon; and
e ' $tatement by the Chairman of the House Committee
on Appropriations in explanation of the provision__

4. Inclusion of generating plants and distribution systems —

_within the meaning of Title IT of the National Indus- -
trial Recovery Act__-_-..-....--- Giteestnnnennee

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APPENDIX A a J
- ACTS OF CONGRESS |
| 1
Trrtz II oF NatyonaL InpustrRiaL Recovery. Act
(c. 90, 48 Start. 200)

AN ACT To encourage national industrial recovery, to foster fair | y
competition, and to provide for the construction of certain usefal ,

_ public Works, and for other purposes. -*

Be it enacted by the Senate and House of Repre- ,

sentatives of the Untted Staté& uf América in 2

Congress assembled, ° :

>

. a / - es *
Trrtz I1—Pusiic Works aNp CONSTRUCTION
FEDERAL EMERGENCY ADMINISTRATION OF PUBLIC | ~ Fei e

_ _ WORKS a : Ia
Section 201. (a) To effectuate the purposes of — ‘ied
this title, the President is hereby authorized to — .
create a Federal Emergency Administration of
Public Wérks, all the powers of which shall be
_ exercised by a Federal Emergency Administrator
of Public Works (hereafter referred to as-the | ie t
“‘Administrator’’), and to establish such agencies, © Jar
to aceept and utilize such voluntary and uncompen- elt
sated services, to appoint, without regard to the ree.
civil service laws, such offgpers and employees, and
to utilize such Federal officers and employees, and,
with the consent of the State, such State and local -
officers and emiployees as he may find necessary, to
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: prescribe their authorities, duties, responsibilities,

and tenure, and; without regard to the Classifica-

tion Act of 1923, as amendéd, to fix the compensa- S

tion’ of any officers and employees so appointed.

- The President may delegate any of his fulhctions

and powers under this title to such officers, agents,
and employees as he may designate or appoint.

(b) The Administrator may, without regatd to
the civil service laws or the Classificatior’ Act.of
1923, as amended, appoint and fix the compensa
tion of such experts and such other offigers and
employees as are necessary to carry out the provi-
sions of this title; and may make such expendi-
tures dincluding expenditures for personal serv-
ices And rent at the seat of government and else-
where, for law books and bogks of reference, and
for paper, Brinting, and binding) as are necessary
to carry out the provisions of this title. :

‘ (ec) AH such compensation, expenses, and allow-

| — shall be paid, out of fynds made available
byt

s Act.

(d). After the calpain of two years sithaie the
date of the enactment of this Act, or sooner if the
President shall by procl&mation or the Congress
shall by jdint resolution declare that the emergency
recognized by section 1 has ended, the President
shall not make any further loans or grants or enter
upon any new construction under this title, and
any agencies established hereunder shall cease to
exist and any of their remaining functions shall be.
transferred to such departments of the Govern-
ment as the President shall designate: Provided,

That he may issue funds to a borrower under this _
7 title prior to January 23, 1939, under the terms of

any agreement, or any commitment to bid upon or

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purchase bonds, entered into with such borrower
prior to the date of termination, under this sec-
- tion, of the power of the President to make loans.
_ xo. 202. The Administrator, under the direc-
~ tion, of the President, shalkprepare a comprehen-
sive program of public works, which shall inelude
among other ¢hings the following: (a) Construe- * “
tion, repair, and improvement ofspublic highways
and park ways, public buildings, and any publicly |
owned instrumentalities and facilities; (b) conser-
vation and development of natural resources, in-
cluding control, utilization, and “purification of
_ waters, prevention of soil or coastal erosion, devel-
opment of water power, transmission of electrical
energy, and construction of river and harbor im-
provement and flood control and the construc-
tion of any river or drainage improvement required
to perform or satisfy any obligation incurred by.
the United States through a treaty with a foreign
Government heretofore ratified and to restore or
develop for the use of any State or its citizens ,
water taken from or denied to them by perform- _
ance on the part of the United States of treaty
obligations heretofore assumed: Provided, That no
river or harbor improvements shall be carried out
unless they shall have heretofore or hereafter been
adopted by the Co or are recommended by «
the Chief of Engin of the United States Army;
(c) any pro of the character heretofore con-
structed or Carried on either directly by public,
. ‘authority or with public aid to serve the interests *
= of the general public; (d) construction, recon-
"struction, alteration, or repair under pubic regu-
lation or control ‘of low-cost housing and slum-
clearance projects; (e) any project (other than

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those included in the foregoing classes) of any
character heretofore eligible for loans under sub-
section (a) of section 201 of the Eqergency “Re-
lief and Construction Act of 1932, as amended,
and paragraph (3) of such subsection (a) shall
for such purposes be held to include loans for
the construction or completion of* hospitals the
operation of which is partly fmanced from public
funds, and of reservoirs and pumping plants and
for the construction of dry docks; and if in the
opinion of the President it seems desirable, the
. construction of naval vessels within the terms
. and/or limits established by the @pion Naval
Treaty of 1930 and of aircraft required therefor
and constwuction of heavier-than-air aircraft and
technica] construction for the Army Air Corps and
such y housing projects as {he President may
appmove, and provision of original equipment for
the mechanization or motorization of such Army
tactical units as he may designate: Provided, how-
ever, That in the event of an international agree-
ment for the further limitation of armament, to
which the United States is signatory, the Presi-
dent is hereby authorized and empowered 40 sus- ~
pend, in whole or in part, any such naval or mili-
tary construction or mechanization and motoriza-
tion of Army -units: Provided further, That this
title sKall not be applicable to public works under
the jurisdiction or control of the Architect of the
Capitol, or of any commission or committee for .
which such Architect is the contracting and/or
executive officer. . =
Sec. 203: (a) With a view to increasing employ-
ment quickly (while reasonably securing any loans.
made by the United States) the President is au- —

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thorized and ¢ empowered, through the Administra- ?
tor or thréugh such other agencies as he may desig:
nate or create, (1) to Construet, finance, or aid in
the construction or financing of any public-works
project included in the program prepared pursu-
ant to section 202; (2) upon such terms as the Pres- *
ident shall prescribe, to make grants to States, mu-
nicipalities, of other public bodies for the con-
structio ; or improvement of any such proj-
ec bat no euch grant shall be, in exosse of 30.
percentum of the cost of the labor and: materials °
_ employed upon such project ; (3) to acquire. by
purchase, or by exercise of the power of eminent
domain, any real or. personal property in connec- *
tion with the construction of any such project, and
to sell any security, acquired or any property so
~ eonstructed or acquired or to lease any such prop- !
erty with or without the privilege of purchase:
‘Provided, That all ‘moneys received from any such : 4
sale or lease or the repayment of any loan shall be ae
used to retire obligations issued pursuant to sec-
tion 209 of this Act, in addition .to ther
moneys required to be or such purpose; (4)
to aid in the, financing of such Yailroad mainte-
nance and équipment as muy be“ approved by the g
Interstate Commerce Commisston as desirable for “
the improvemenf of transportation facilities; and _
°) to advance, upon. request of the Commission ~ -
ving jurisdiction of the project, the unappro-
rere balance of the ‘sum authorized for carrying
out the provjsions of the Act entitled “An Act ‘to
provide for construction and equipment of an om i
annex to the Bibrary of Congress,” approved June _
18, 1930 (46 Stat. 583); such advance, to he ex- -
pended under the direction of such Commotion

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and in accordance with such Act: Pisstiies, That
. in deciding to extend any aid or grant hereunder —
aS a to any State, county, or municipality the President
SO may consider whether action is ip process or in -
‘[. | good. faith assured therein reasonably designed to

bring the ordj current expenditures thereof
within the firudently estimated revenues thereof.
The provisions of this section and section 202 shall —
extend to public works in the several States, ©~
* © Hawaii, Alaska, the District of Columbia, Puerto |
a _ Rico, the Canal Zone, and the Virgin Islands.
- (b) All expenditures for authorized travel hy.
officers and employees, including subsistence, re-
quired “on account of any ‘Federal: public-works
projects, shall be charged to the amounts allocated
to such projects, notwith}tanding any other provi- ~
sionsof law; and there is authorized to be eraployed
such personal servicés in the Distrief of Columbia
and elsewhere as may be required to be engaged ©
upon such work and to be in addition to employees
otherwise provided -for, the compensation of such
additional personal servicés to be a charge.against
the funds made available for such construction
work.

(ec) In th acquisition of any land or site for the
purposes of Federal public buildings and in the
construction of such buildings provided for in this .
title, ‘the provisions contained in sections 305 and ©
206 of the Eme.:gency Relief and. Construction Act

. of 1932, as amended, shall apply. P

(da) The President,. in_his discretion, and undér
if. such terms as he may prescribe, may extend any*
a | . of the benefits of this title to any State, county, or
: municipality, notwithstanding any constitutional or
legal restriction.or limitation on the right or power

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of dant State; county, or municipality to borrow
‘money or incur indebtedness. ,

- So. 204. (a) For the purpose of providing for
emergensy construction of public highways and

— projects, the President is authorized to
make grants to the highway departments of the ~

: aia States in an amount not less than. $400,-
000,000, to. be expended by such departments. in
accordance with the provisions of the Federal
Highwhy Act, approved November 9, 1921, as
- amended and supplemented, except as provided i in
this title, as follows:

(1) For expenditure in emergency construction
_ on the Federal aid highway system and extensions
thereof into and through municipalities. The
amount apportioned to any State under this para-

..grapk may be used to pay all or any part of the — |
cost of surveys,-plans, and of highway and bridge |

construction, including. the elimination of hazards

to highway traffic, such as the separation of grades .

-at crossing, the reconstruction of existing railroad

grade crossing ‘structures, the relocation of high- -
| @ ways to eliminate railroad cressings, the widening

of narrow bridges and roadways, the building of
footpaths, the replacement of unsafe bridges, the

construction of routes to avoid congested axeas, the -

construction of facilities to improve accessibility
and the free flow of traffic, and the cost. of any
> other construction that will provide. safer traffic

facilities or definitely eliminate existing hazards

to pedestrian or vehicular traffic. No funds madé
available by this title shall be used for the agquisi-
tion of any land, right of way, or easement in con-
nection with any -railroad grade —
project.

8

(2) For expenditure in emergency construction
on secondary or feeder roads to be agreed upon by
the State highway departments and the Secretary

of Agriculture: Provided, That the State or re-
sponsible political subdivision shall provide for the
proper maintenance of said roads, Such grants -
shall be available for payment of the full cost of
surveys, plans, improvement, and construction of
secondary or feeder reads, on which projects shall
be submitted by the State highway department and _
approved :by the Secretary of ines, 3

(b) Any amounts allocated by the President for.
grants:under subsection (a) of this section shall
be apportioned among the several States seven-
eighths in accordance with the provisions of sec-
tion 21 of the Federal Highway Act, approved
November 9, 1921, as amended and supplemented
(which Act is hereby further amended for the pur-
poses of this title to include the District of Colum-
bia), and one-eighth in the ratio which the popu-
lation of each State bears to the total population
of the United. States, according to the latest de-

, cennial census and shall be available on.July 1,..

1933, and shall remain available until expended;

but no part of the funds apportioned to any State
need be matched by the State, and such funds may
also be used in lieu of State funds to match unob-

‘ligated balances of previous apportionments of

regular Federal-aid appropriations...

(c) All contracts involving the expenditure of
such grants shall contain provisions establishing
minimum rates of wages, to be predetermined by
the State highway department, which contractors
shall pay to skilled and unskilled labor, and such
minimum rates shall be stated in the invitation for

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bids and shall be included i in proposals for bids for
the work. |

(d) In the expenditions of such amounts, the
* limitations in the Federal Highway Act, approved
November 9, 1921, as amended and supplemented,
upon highway construction, reconstruction, and
bridges within municipalities and upon payments
per mile which may be made from Federal funds,
shall not apply.

(e) As used in this section the term ‘‘State’’ in-
eludes the Territory of Hawaii and the District of
Columbia. The term ‘“‘highway’’ as defined in the
Federal Highway Act approved November 9, 1921;
as amended and supplemented, for the purposes of
this section, shall be deemed to include such main
parkways as may be Semgnates by the State and
approved by the Secretary of Agriculture as part
of the Federal-aid highway system.

(f) Whenever, in connection with the construc-
tion of any highway project. under this section or
section 202 of this Act, it is necessary to acquire
rights of ‘way over or through any property or
tracts of Jand owned and-controlled by the Govern-
ment of the United States, it shall be the duty of
the proper official of the Government of the United
States having control of such property or tracts of
land with the approval of the President and the _
Attorney General of the United States, and with- .
out any expense. whatsoever to the United States,
to perform any acts and to execute any agree-
ments necessary to grant the rights of way so
required, but if at any time the land or the prop-
- erty the subject of the agreement shall cease to
- be used for the purposes of the highway, ‘the title
‘in and the jurisdiction over the land or property

. 10

shall automatica'ly revert to the Government of
the United States and the agreement shall so
provide.

> (g) Hereafter in the administration of the Fed-
wa Highway Act, and Acts amendatory thereof or
supplementary thereto, the first paragraph of sec-
tion 9 of said Act shall not apply to publicly owned
toll bridges or approaches thereto, operated by the
highway department of any State, subject, how-
ever, te the condition that all tolls received from
the operation of any such bridge, less the actual .

eost of operation and maintenance, shall be applied .

to the repayment of the cost of its construction or
acquisition, and when the cost of its construction or
acquisition shall have been repaid in full, such
bridge thereafter shall be maintained and. operated

~as a free bridge.

Sec. 205. (a) Not less than $50,000,000 of the
amount made available by this Act shall be allotted
for (A) national forest highways, {B)* national

_ forest roads, trails, bridges, and related: projects,

(C) national park roads,and trails in national
parks owned or authorized, (D) roads on Indian
reservations, and (E) roads through publie lands,

_ to be expended in the same manner as provided in

paragraph (2) of section 301 of the Emergency
Relief and Construction Act of 1932, in the case of
appropriations allocated for such purposes, re-

. spectively, in such section 301, to remain available -

until expended. . ¥
(b) The President may also allot funds made

available by this Act for the construction, repair,

and improvement of public highways in Alaska.
the Canal Zone, Puerto Rico, and. the Virgin
Islands. .

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Sec. 206. All contracts let for construction
projects and all loans and grants pursuant to this
title shall contain such provisions as are necessary
to insure (1) that no convict labor shall be ‘em-
ployed on any such project; (2) that (except in
executive, administrative, and supervisory posi-
tions), so far 2s practicahle and feasible, no indi-
vidual directly employed on any such project shall
be permitted to work more than'thirty hours in dny
- one week; (3) that all employees shall be paid just
and reasonable wages which shall be compensation
sufficient to provide, for the hours of labor as lim-
ited, a standard of living in decency and comfort;
(4) that. in the employment of labor in connection
with any such project, preference shall be given,
where they are qualified, to ex-service men with de-
pendents, and then in the following order: (A) To

citizens of the United States and aliens who have

declared their intention of becoming citizens, who
are bona fide residents of the political subdivision
and/or county,in which the work is to be per-

-formed,.and (B) to citizens of the United States
and aliens who have declared their intention of be- |

coming citizens, who are bona fide residents of the
State, ‘Territory, or district in which the work is to
be performed: Provided, That these preferences
_ shall apply only where such labor is available and
qualified to perform the work to which the employ-
ment relates; and (5) that the maximum of human
labor shall.be used in lieu of machinery wherever
practicable and consistent with sound a 98
public advantage.

Sec. 207. (a) For the purpose of sepuditios the

actual construction of public works contemplated —

_ by this title and to provide a means of financial

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assistance to persons -uncer contract with. the
United States to perform such construction, the
President is authorized and empowered, through
‘l the Administrator or through such other agencies
' as he designate or create, to approve any as-
signment executed by any such contractor, with the
written consent of the surety or sureties upon the
penal bond executed in connection with his con-
~ tract, to any national or State bank, or his claim
against the United States, or any part oi such
claim, under such contract; and any assignment ‘so
approved shall be valid for all purposes, notwith-
standing the provisions of sections 3737 and 3477

of the Revised Statutes, as amended. —
— _ (b) The funds received by a contractor under
any advances made in consideration of any such
~ assignment are hereby declared to be trugt funds
in the hands of such cohtractor to be first applied
to the payment of claims of subcontractors, archi-
tects, engineers, surveyors, laborers, and material
men in connection with the project, to the payment
of premiums on the penal bond or bonds, and pre-
,_ miums accruing during the construction of such
* project on insurance policies taken in connection
therewith. Any contractor and any officer, di-
rector, or agent of any such contractor, who ap-
plies, or consents to the application of, such funds
for any other purpose and fails to pay any claim or
premium hereinbefore mentioned, shall be deemed
_ guilty of a misdemeanor and shall be punished by
' a fine of not more than $1,000 or by iniprisonment
‘ for not more than one year, or by both such fine and

imprisonment.

(ce) Nothing in this section shall be considered
as imposing upon the assignee any obligation to

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see to the proper application of the funds ad-
vanced by the comgaee: in consideration of such
SUBSISTENCE | HOMESTRADS : .

Sec. 208. To provide for aiding the redistribu- ;

tion of the overbalance of population in industrial -

centers $25,000,000 is hereby made available to the

President, to be used by him through such agencies

as he may establish and under such regulations as

he may make, for making loans for and otherwise

aiding in the purchase of subsistence homesteads. =

The moneys collected as repayment of said loans 4

shall constitute a revolving fund to be administered

as directed by the President for the purposes of

this section. i

RULES AND REGULATIONS

Sec. 209. The President is authorized to pre-
scribe such rules and regulations as may be nec-
essary to carry out the purposes of this title, and
any violation of any such rule or regulation shall
be punishable by fine of not to exceed $500 or im-
prisonment not to exceed six months, or both.

ISSUE OF SECURITIES AND SINKING FUND

Sxc. 210. (a) The Secretary of the Treasury is
authorized to borrow, from time to time, under the
Second Liberty Bond Act, as amended, such
amounts as may be necessary to meet the expendi-
tures authorized by this Act, or to refund any obli-
gations, previously issued under this section, and to —
iggue therefor bonds; notes, certificates of indebted-
ness, or Treasury bills of the United States. |

(b) For each fiscal year beginning with the fiscal
year 1934 there is ee appropriated, in — !

ep Re We nage poste RARER Aa eS PIRES SRE RES

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. 14 .
to and as of, the cumulative sinking fund pro-
vided by ecen 8 the Victory Liberty Loan Act, |

" . as amended, oubof any money ithe Treasury not .
otherwise appropriated, for the purpose of such
fund, an amount equal to 214"per gentum of the
— amount of the expenditures made out.
of appropriations made or authorized under this —

_ Act as determined by the Secretary -of- the
> Treasury. | =
| “REEMPLOYMBNT AND RELIVE TAXES

Si. 211. (a) Effective as of the day following
the date of the enactment of this Act, section 617
(a) of the Revenue Act of 1932 is amended by
striking out ‘‘1 cent’’ and inserting in lieu thereof ~
“% centa.”’ :

- (®) Effective as of the day following the date of
the enactment of. this- Act, section 617 (c) (2)
of such Act is amended by adding. at the end.
thereof a new sentence to read as follows: ‘‘As
used in this paragraph the term ‘benzol’ does not’
include benzol sold for use otherwise than as a fuel
for the propulsion of motor vehicles, fnotor boats, —
or airplanes, and otherwise than in the manufac. |
ture or production of such fuel.” ,

Seo. 212. Titles IV and V of the Revenue Act of

_ 1982 are amended by striking out ‘‘1934’’ wherever
“appearing therein and by inserting in lieu thereof
. *1935"". Section 761 of the Revenue Act of 19382
is further amended by striking out “and on July
1, 1938” and inserting in lieu thereof ‘‘and on
July 1, 1933, and on July 1, 1934,”.
. ge. 213. (a) There is hereby imposed upon the
iene (required to be included in

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month after the close of. the year with respect to
which such tax is impobed to the collector for the
district in which is located its principal place of
+usiness or, if it has no principal place of business
_ in the United States, then to the collector at Balti-
more, Maryland..-.Such return shall cortain such
information and be made in such thanner as the
Commissioner with the approval of the Secretary

may by regulations prescribe. The tax shall, with-.

out assessment by the Commissioner or notice from
the collector, be due and payable to the. collector
before the expiration of the period for filing the

return.’ If ¢he tax is not paid when due, there shay

be added as part of the tax.interest at the rate of 1
- per centum a month from the time when the tax
became due until paid. All provisions of law (in-
cluding penalties) applicable in réspect.of the
taxes imposed by section 600 of the Revenue Act
of 1926 shall, in so far as not inconsistent with

this section, be applicable in respect of the taxes’.

imposed by this section. The Commissioner may

extend the time for making the returns and paying . |

the taxes imposed by this section, under such rules

and regulations as he ma prescribe with the‘ ap-

proval of the Secretary, but no such extension shall
be for mote than sixty days.

(e) Returns required to be filed for the purpose ©

- of the tax-imposed by this section shall be open to
inspection in the same manner, to the same extent,
and subject to the same provisions of law, includ-

ing penalties, as returns made under title IT of the .

Revenue. Act of 1926.

(f) For the fitst year.ending June 30 in respect i

of-which a tax is imposed by this section upon any
: corporation, the adjusted declared value shall be

Fis

the value, as declared by the corporation in its first
return under this =*etion (which declaration of ©
value cannot be amended ), as of the close of its last
' income-tax taxable year ending at or prior to the
close of the year for which the tax is imposed by
this section (or as of the date of organization in
the case of a corporation ltaving no. income-tax
taxable year ending at or prior to the close of the
year for which the tax-is imposed by this section).
For any subsequent year ending June 30, the ad-*
justed declared value in the case of a domncatio cor
- poration shall be the original declared value plug, §
(1) the cash and.,fair market value of property ~
paid in for stocix or shares, (2) paid-in surplus and
contributions to capital, and (3) earnings and
profits, and minus (A) the value of property dis-
tributed*in liquidation to sharebelders, (B) dis- ~
.tributions of earnings and profits, and (C) deficits,
whether operating or nonoperating; each adjust-
ment being made for the period from the date as
of which the original declared value ‘was declared
to the close of its last income-tax taxable year end-
ing at or a to the close of the year for which
the tax is imposed by this section. For any subse--
quent year ending June 30, the adjusted declared
value in the case of a foreign corporation shall he
' the original declared value adjusted, in accordance
with regulations prescribed by the Commissioner -
with the approval of the Secretary, to reflect in-“
creases or decreases. (for the period specified in
the preceding sentence) in the capital employed in
the transaction of,its business in the United States.
' . (g) The terms used in this section shall have the
‘same meaning as when used in the Revenue Act of
1932. ' :

>
wt

19

Sec. 216. (a) " There is hereby imposed upon the. ~
net income of every corporation, for each income-
tax taxable year ending after the close of the first
year in respect of which it is taxable under section
915, an. excess-profits tax equivalent to 5 per
eentum of such portion of its net income for such
income-tax taxable year as is in excess of 121% per
centum of the adjusted declared value of its cap-
ital stock (or in the case of a foreign corporation

the adjusted declared value of capital employed’
' jn the transaction of its business in the United
States) as of the close of the preceding income-tax
taxable year (or as of the date of organization if
it had no preceding income-tax taxable year) de-
termingsé as provided in section 215. .The terms
used in this section shall have the same meaning
as when used in the Revenue Act of 1932. . )

(b) The tax imposed by this section shall be as-
sessed, collected, and paid in the same manner, and
shall be subject to the same provisions of law (in-
cluding penalties) as the taxes imposed by —_: I
of the Revenue Act of 1932.. ie

Sec. 217. (a) The President shall proclaim the |
date of— - Se en ge me er Oa

—_——— =~ - _ ° _

WR nn meet me

24

struction Finance Corporation is authorized and
empowered under section 9 of the Reconstruction
Finance Corporation Act, as amended, to have
outstanding at any one time is decreased by .
$400,000,000.

SEPARABILITY CLAUSE

‘Sec. 303. 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 provision to other persons or
circumstances, shall not be affected thereby.

SHORT TITLE

Seo. 304. This Act may be cited as the “Na- _
tional Industrial Recovery Act.”’
Approved, June 16, 1933, 11: 55 a. m.

eee Tee
EMERGENCY APPROPRIATION: ACT, Fuca Year 1935
——(e, 648, 48 Star. 1021, 1055)

AN ACT Making. appropriations to supply deficiencies in certain
tions for the fiscal year ending June 30, 1934, and prior
fiscal years, to provide supplemental general and emergency appro-
priations for the fiscal years ending June 90, 1994 and June 5d,
_ 1985, and for other purposes.

Be it enacted by the Serate and House of Repre-
sentatives of the United States of America in Con-

gress assembled, That the following sums are ap-

propriated, out of any money in the Treasury not
otherwise appropriated, to supply deficiencies in
certain appropriations for the fiscal year ending
June 30, 1934, and prior fiscal years, to provide
supplemental general and emergency appropria-
tions for the fiscal years ending June 30, 1934, and
June 30, 1935, and for other purposes, namely:

-

: —
ne ai ; —

25 ,
TrTLE [I—EMERGENCY APPROPRIATIONS
EXECUTIVE

For an additional amount for carrying out the
purposes of the Act entitled ‘“‘An-Act for the relief

of unemployment through the performance of use-_

ful public work, and for other purposes,’ approyed
March 31, 1933 (48 Stat. 22) ; the Federal Emer-

gency Relief Act of 1933, approved May 12, 1933
(48 Stat. 55) ; the Tennessee Valley Authority Act
of 1933, approved May 18, 1933 (48 Stat..58) ; and
the National Industrial Recovery Act, approved
“June 16, 1933 (48 Stat. 195); and including
$325,000 for an addition to the Executive Office
Building and for the furnishings and equipment
thereof ; $899,675,000, to be allocated by the Presi-
dent for further carrying out the purposes of the
aforesaid Acts and to remain available until June
30, 1935: Provided, That not exceeding $500,0™,000

in the aggregate of any savings or unobligated bal- .

ances in funds of the Reconstruction Finance Cor-
poration may, in the discretion of the President, be
transferred and applied to the purposes of the Fed-
- eral Emergency Relief Act of 1933 and/or title I
of the National Industrial Recovery Act, and any
unobligated balances in appropriations (including
allocations of appropriations). of the Federal
Emergency Administration of Public Works may,

in the discretion of the President, be transferred |

and applied to the purposes of such Federal Emer-
gency Relief Act of 1933: Provided further, That
' the amounts to be made available under the author-

ity of this paragraph for public-works under the
National Industrial Recovery Act shall not exceed .

in the aggregate $500,000,000.

Deattes 2 2 —
eharacter for which the Federal Emergency Ad- .
ministrator of Public Works (hereinafter called ©
the Administrator) has heretofore made loans or
grants pursuant to Title II of the National Indus-
trial Recovery Act or the Emergency Relief Appro-
priation Act of 1935, the Administrator may, upon
- the direction of the President, use not to exceed
$300,000,000 from funds on hand or to be received
from the sale of securities, for the making of
grants, to aid in the financing of such projects:
Provided, That no part of the sum made available
by this paragraph shall be granted for any project
unless, in the determination of the Administrator,
the completion thereof can be substantially aecom-
plished prior to July 1, 1938, and adequate provi-
sion .has been made or is assured for financing such
part of the entire cost thereof as is not to be sup-
plied through the Federal Emergency Administra-
tion of Public Works: Provided further, That this
limitation upon time shall not apply to any project
enjoined in any F'edéral or State court: Provided.
further, That in no case shall the amount of the
grant exceed forty-five per centum of the cost of the
project. Nothing herein shall be construed to in-
crease the amount of notes, bonds, debentures, and
other such obligations which the Reconstruction
Finance Corporation is authorized and empowered
under exiting law to issue and to have outstanding
at any gne time, and nothing herein shall be con-
strued to limit or curtail in any way any powers

which the Federal Emergency Administration of
Public Works or the Administrator‘is now author-
ized to exercise. :

5

Pusiic WorKS ADMINISTRATION ExtTENSION ACT OF
1937 (PusLic Resotution No. 47, 75rH Cona.)

* JOINT RESOLUTION Making appropriations for relief purposes

Resolved by the Senate and House of Represent-
—_atives of the United States of America in Congress
assembled, .

2 * + : * : a

’ Trriz IT

Src. 201. The Federal Emergency Administra-
tion of Public Works (herein called the “‘ Admimis-
tration’’) is hereby continued until July 1, 1989,
and until such date is hereby authorized to con-
tinue to perform all functions which it is author-
ized to perform on June 29, 1937. All provisions
of law existing on June 29, 1937, and relating to
the availability of funds for carrying out any of the
_ functions of such Administration are hereby con-
tinued until July 1, 1939, except that the date speci-
fied in the Emergency Relief Appropriation Act of
1936, prior to which, in the determination of the
Federal Emergency Administrator of Public
Works (herein called the ‘‘Administrator”’), a
project can be substantially completed is hereby
changed from ‘“‘July 1, 1938’’ to “‘July 1, 1939.”’.
xc. 202. The amount which the Reconstruction
Finance Corporation is authorized by existing law
‘to have invested at any one time in securities pur-
chased from the Administration is hereby in-
creased from $250,000,000 to $400,000,000._.

—_—

40

Sec. 203. The amount of funds which the Ad-
ministrator, upon direction of the President, is
- authorized to use for grants from moneys realized
from the sale of securities is hereby increased from
$300,000,000 to $359,000,000; and after the date of —
the enactment of this joint resolution no allotment
shall be made by the Administrator for any project
the application for which has not been approved
‘by the examining divisions of the Administration
prior to such date.

Sec. 204. The paragraph in the Tedepentent
Offices Appropriation Act, 1938, under the caption
‘Federal Emergency Administration of Public.
Works’”’ is hereby amended by (a) striking out the
words ‘‘in connection with the liquidation”’ and (b)
striking out the sum of ‘‘$10,000,000”’ and insert-
ing in lieu thereof the sum of ‘‘$15,000,000.” ©

Sec. 205. The funds available to the Adminis-
- trator for the making of loans or grants~-or loans
and grants may be used for projects (in addition
to other purposes for which funds may be~use 1)
of the following classes, in amounts not to exeecd
the sums specified for each such class: (a) For
school projects (other than those included in sub-
divisions (b) and (c) of this section) to replace,
eliminate, or ameliorate existing school facilities
or conditions which, in the determination of the
Administrator, are hazardous to the life, safety,
or health of school children, $60,000,000 for grants
and $11,000,000 for loans; (b) for projects which
have been authorized, or for the financing of which
bonds or other ‘obligations have been authorized,
at elections held prior to the date of enactment of
this joint resolution, or for projects for which an
authority « or board constituting an independent

‘value: Provided, ‘That an allo

41

~eorporation without taxing power has ian spe-

cifically created by a State legislature prior to such
date, $70,000,000 for. grants and $22,000,000 for
loans; (c) for projects for which appropriations
have been made by the legislatures of the States,
$15,000,000 for grants and $2,000,000 for loans;

- (d) for projects to be financed, except for the.

grant, by the issuance to contractors of tax or
assessment securities at not less than

made for any such project unless the applicant
has, in the determination of the Administrator,
made or incurred substantial expenditures or obli-
gations in contemplation of receiving an allotment,
$5,000,000 for grants; (e) for ‘projects for which
funds have been tentatively earmarked by the Ad-
ministrator but for which formal allotments have
not been made, $54,000,000 for grants and $78,-
000,000 for loans: Provided,:That the grant for
any such project ‘shall not exceed the-amount ten-
tatively earmarked as a grant for such project:

Provided further, That the amount specified for

any of the foregoing classes may be increased by

not to exceed 15 per, centum thereof by transfer-

ring an amount or amounts from any other class
or lasses in order to effectuate, the pee of °
the title.

Sec. 206. No new "applications for loans or
grants for non-Federal projects shall be received

~ or considered by the Administration after the date ~

of enactment of this joint resolution.

Src. 207. Title II of this joint. resolution may
be cited as the “Public Works Administration
Extension Act of 1937.”

Approved, June 29, 1987, 11 p. m.

.
ob Sachin atoning ae ga ALDOR? RA Te,

—_ ee ee nee ical Smaak a
neh Riker i nia Bouin Maal Lao LE Mia So ates La gh ao ee Fh a
shy township, city, or
incorporgtet town of the State of South Carolina
which may now or hereafter own ‘and operate any-
such system is authorized to improve, enlarge, ex-
tend or repair the same. The work system as used
in this Act shall include all of the projects and
undertakings referred to in this section, —
Section 2. Cumulative—Alternate Method.—
This Act shall be construed as cumulative authority
for the purposes named in Section 1 hereof, and as
to the manner and form of issuing revenue bonds
for any such purpose or purposes, and shall not
‘be construed to repeal any existing laws with re-
spect thereto, 4% being the purpose and intention of
this Act to create an additional and alternate meth-
od for the purposes herein named. .
_ Section: 3. ‘‘Borrower’’ Defined—The -word _
-#*borrower’’ as used in this Act shall be construed
to mean the county, township, city, or incorporated
town as the case may be, operating under this Ad&
Section 4. ‘Borrowing Body’’ Defined.—The ©
term ‘‘governing body”’’ as used in this Act shall be
construed to inean, in the case of a county, the
Board of County Commissioners, or other like gov- °
erning body thereof, in the case of a city or incor- .
porated town, the Board of Commissioners, the
Mayor and Council, or other like governing body
thereof, and in the ease of a township the Board o7
County Commissioners, or the governing body of
the County in which the township is located.
Section 5. Make Estimate of System.—When- -
ever the governing body of ahy borrower shall
determine to purchase, construct, improve, enlarge,
extend, or repair any system named in Sectioné -

a ce een .
under the provisions of this Act? it shal first cause
_an estimate to be made of the coat thereof, and tle
fact that such estimate has been made. and the.
' amount thereof shall appear in the ordinance au-
thorizing and providing for the issuance of the’
. bonds.
Section 6. Powers of Borrower—Ordinances—
Resclutions.—For the purposes of this Act any
borrower is authérized to adopt ordinances provid-
ing for the issuance of revenue bonds as herein
stated, and any and all other appropriate ordi-
“nanees and resolutions deemed necessary to effeetu-
- ate the full intent and purpose of this Act, in,
cluding the segregation of revenues derived from

hereof, the determinatéon, fixation, and revision
.from time to time of rates to be charged for serv-
ices, and any and all other necessary ordinances
and resolutions to protect the properties, to pro-
vide for the adequate operation thereof, and ta in-
sure the security of the bonds. Provided, However,

this Act shall be the same as is provided by the laws’
of the State in the case of cities, and the manner
of adoption thereof shall be as is provided in the
general laws of the State for cities. The amend-

shall be as is provided by the general laws of the
State for amendment of ordinances of cities. Such
ordinances and resolutions of counties shall be re-
corded in the minutes.of the governing body there-

shall be authenticated by the signature of the clerk

>

the operation of any. project named in Section 1 -

That in the case of counties and townships the
style of any ordinance or resolution adopted under °

ment of such ordinances and resolutions of counties |

of as soon as practicable after their passage and

of such governing body. “Any such ordinances or

“ - ie, : ;
_ resolutions of counties may bé published in a news-
paper of general circulation in such county.
SecTION 7. May. Borrow— Issue Bonds— |
-Bonds—Payment.—For the purpose of defraying ©
_ the -cost of purchasing, constructing, improving,
enlarging, extending, or repairing any such sys-
tem or project, any borrower may borrow money
and issue its negotiable serial bonds, provided that
no such bonds shall be isstied unless and until au-
thorized by an ordinance which shall set forth a
brief description of the contemplated improve-
ment, the estimated cost thereof, the amouft, maxi-
mum rate of interest, time and place of payment,
and othe¥ details in connection with the issuance
of the bonds.* Such serial bonds shall bear interest
at not more.than six per cent (6%) per annum,
payable semi-annually, and sHall be payable at such
times, not exceeding forty-five. (45) years from
their date, and at stch places aS shall be prescribed
- in the ordinance providing for their issuance. The
bonts and the coupons. shall“be exécuted in such
manner and shall be substatitially in the form pro-
vided in the authorizing ordinance. ‘Such bonds
shall be sold in such mamper and upon such terms
- as the governing body shall deem for the best in-
terests of the borrower. In no event shall any of
the bonds be sold on a basis to yield more thay six
per cent (6%) per annum from the date of sale
to the date of average maturity of the bonds sold. ©
Provided, however, That in any contract for the
purchase or construction of any system or project
named in Section.1, or for the improvement, en-
largement, extension, or repair of any such system
or project provision may be made that payment
therefor shall be made in such bonds. Such bonds

o

and their coupons may be made payable in lawful
money of the United States of America, or in gold
coin of the standard weight and fineness existing
on the date thereof. Such bonds sifall mature an-
, nually, or semi-annually and the first installment
thereof shall be. made payable not more than five
(5). years from the date of such_borids. No such y
installment shall be more than two and one-half
times as great in amount as thé’smallest prior in- ,
stallment of the same issue. If all the bonds of |
an issue are not issued at the same time, the bonds
at any one time outstanding shall mature as afore-
said. ‘The principal ‘of ,and interest upon. such
_ bonds shall be payable solely from the revenue de-
rived from the operation of the system or project
. for the purchase, construction, improvement, en-
_ largement, extension, or repair of which the same
are issued; Provided, however, t where a bor-
rower improves, enlarges, extends, or repairs any
system or project named in Section 1 the princi-
pal of interest upon such bonds may be made
payable from the revenues derived from the opera~ |
tion of the entire system or project. No borid or
coupon issued pursuant to this Act shall conatjtute
an indebtedness of such barrower within the mean-
ing of any State constitutional provision or statu-
tory limitaffon. It shall be plainly stated on the
' face of such d and coupon that the same «
has been: issued r the provisiogs of this Act
and that it Joes not constitute an indebtedness of
such borrower within any State constitutional Pro.
vision or statutory limitation. Provided, however,
That any municipality now or hereafter owning pi
~ and operating a system or project namgd in See- i
tion 1, whether constructed under the provisions of ‘

a

a aes |
‘ 62 | soe
this Act or not, and desiring to improve, enlarge,
extend or repair the same, may issue revenue ,
bonds under the provisions of this Act to pay for
such improvements, enlargements, “extensions or
repairs, payable from the net revenues to be de-
rived from the operation of the existing system or
project as improved, enlarged, extended’ or re-
paired, but nothing in this proviso shall be. con-
strued as authorizing any such municipality to
impair or commit a breach of the obligation of any ~
valid lien or contract created or entered into by it,
the intention hereof being to authorize the pledg-
- ing, setting aside and segregation 0 h revenues
for the construction of such improvements, en-
largements, extensions or repairs only’ where con-
sistent witl. outstanding obligations of such
municipality.
on 8. Bond Holders Hive Lien on Sys-

tem.—There shall be created in the authorizing
ordinance a statutory lien upon any such system or
project, and the appurtenances and extensions |
thereto so to be purchased, constructed, improved, ~
enlarged, extended or repaired, to and in favor ot
the holders of said bonds and each of them,gand to
and in favor of the holders of the coupons of said °
bonds, and each of them.’ Provided, however, That
where any borrower. purcliases, constructs, im-
proves, enlarges, extends or repairs any system or
project named in Sectjon 1, said statutory lien may
be created and declared to be upon the whole of —
such eombined system or project with appurte-
nances and extensions therete, if the governing
body so determines.

SEcTION 9. Enforcement of Lien.pf Bond Hold-
ers.—Such system project or combined system so

qn

. * an ‘ . : - oa n.® ~s 2 a
d ‘ . e : st, Cie pk ee a ~
p ; aay _—
‘

=

er a
purchased, constructed, improved, enlarged, ex-
-tended. og repaired shall remain subject to said
statutory lien until payment in full of the principal
of and interest upon said bonds. Any holder of
-any said bonds 6t of any of the coupons represent-
ing interest accrued thereon, may, either at law or
in equity, by suit, action, mandamus, or other pro-
ceedings, protect and enforce said statutory lien P
and may-by/suit, action; mandamus or other pro-
ceedings, enforce and compel performance of all
duties of the officials of the borrower, in¢ttding the ,
’ fixing of sufficient rates, the collection of revenues,
the proper segregation of the revenues of the proj-
ect or combined system, and the proper applications ’
thereof. - Provided, however, That said statutory
- lien shall not Beconstrued to give any such bond %
or coupon ‘holder futhority to compel the sale of
such project. or combined system or any part
« thereof. a vn | .
Section 10. Receiver — Appointment — Duties
and Powers.—If there be any default in the pav-
ment 6f the pefncipal of or interest upon any of
said bonds, any court\having fartatietion Beng.
proper action may appoint a reeeiver to adminis-
ter and opertte the system, project, or combined
system so encumbefed, on behalf -of the borrower™
with power to &x and charge rates and collect rev- i
enues sufficient to provide for the payment of any -
bonds or other obligations outstanding against said =
systems or combined: system and for the payment
of the expenses of’operating and maintaining the
same and to apply the income and revenues of said
system, project, or combined system in conformity - .
with this act and the ordinafice providing for the
issuance of such bonds. ibe a pie

-

Section 11. Limitations of Bonds.—The borids
authorized hereunder shall riot be subject to any
limitations or provisions of the ngynicipal bond
ode or the bond laws for‘eounties as now in force ,

. or hereafter amended. ae ae eee ae

SECTION 12.. Bonds Legal Investments.—Bonds
issued under the provisions of this act are legal in- .
vestments for executors, administrators, trustees,
and other fiduciaries and for savings banks and.
insurance companies os under the laws of
this State.

Section 13. Bonds Tax Exémpted. The bonds *

and interest coupons issued hereunder are hereby |

_ exempted from any and all State, County, munici-
.» pal, and other taxation whatsoever under the laws:
of the State of South Carolina, and. it shall be
-/« -. solely . for the purchase, construction, improve- .

mént, enlargement, extension or repair of the sys-
' tem, project, or combined system for which issued,
including. any engineering, legal and. other ex-
penses incident thereto: Provided, however, That.
such mgneys may be used also to advance the pay-
ment. of the interest on such- bonds during the first
‘three (3) years following ‘the date of such bonds:
Provided, That any unexpended balance of the
proceeds of the sale of any such bonds remaining
: after the completion of the project for which is-
sued shall be paid immediately into the Bond and
Interest Redemption Fund for such-bonds, and
’ the same shall be ‘used only for the payment of the
principal of.the bonds, or, in the-alternative, to ac-
quire outstanding bonds of the general issue from
which the proceeds were derived, by purchase of. °
~ such bonds at a-price (exclusive of accrued inter-
est) not exceeding the face amount thereof. Any
bonds 20 acquired by purchase shall bé' cancelled
and shall not be reissued. - ;
Section 17. Undelivered. Bonds Executed by
Ex-officers Valid.—In casé any of the officers whose
signatures or counter-signatures appear on the
ponds or coupons shall cease to be such officers be-
fore delivery of such bonds, such signatures or .
~ eounter-signatures_shall nevertheless be valid and,
- sufficient for all purposes the same as if they had
: yemained in office until such delivery. | eo

,

- 66

Section 18. Payment for Service by Bor-
rower.—No free service shall be furnished by any
such system or combined ‘system to the county,
township, city or incorporated town or to any
agency, instrumentality, person, firm or corpora-
tion. The reasonable cost.and value of any service
rendered to any such borrower by any such system,

project, or combired system shall be charged ©

against the. borrower and shall he paid for monthly
as the service accrues from: the current funds, on
from the proceeds of taxes which such borrower,

within constitutional limitations, is hereby author- .

ized and required to levy in an amount sufficient for
that purpose, and such funds, when so paid, shall.
be accounted, for in the same manner as other reve-
nues of such system or combined system.

Section 19. Additional Bonds.—Any borrower
_ purchasing, constructing, improving, enlarging or
repairing. any such system, project or combined
system pursuant to the provisions of this Act, may,
at the time of the authorization of such bonds for
any such purpose or purposes, provide in the au-
thorizing ordinartce for additional bonds for other
extensions and permanent improvements, which

~

, additional bonds may be issued and be negotiated -

from time to time as such proceeds for such pur-_

pose may be necessary. Such bonds, when so nego-
tiated, shall have equal standing with the bonds of
the same issue.

Section 20. Revenue Refunding Bonds.—Where
a borrower has outstanding any bonds issued under
_ thesprovisions of this Act, it may thereafter issue
and negotiate new bonds on such terms as the gov-
erning body shall deem allvisable for the purpose of
providing for the payment of any such outstanding

4

rs

1)

67

bonds. Such new bonds shall be designated ‘‘reve-
nue refunding bonds,’’ and shall be secured to the
same extent and shall have the same source of pay-
ment as the bonds which have been theréby
refunded. Fe

- SeEcrTion 21; Rates for Service Rates for serv-
ices furnished by any such system or combined sys-
tem shal! be fixed precedent to the issuance of the
bonds. Such rates shall be sufficient to provide for
the payment of the interest upon and the princi-
pal of all such bonds as and when the same become
due and payable, to create a Bond and Interest Re-
demption Fund therefor, to provide for the pay-
ment of the expenses of administration and opera-
tion and such expenses for maintenance of the sys-.
tem or combined system necessary to preserve the
same in good repair and working order, to build up
a reserve -for depreciation of the existing system,
project or combined system, and to build up a re-.
serve for improvements, betterments and exten-
sions to the existing system, project, or.combined
system other than those'necessary to maintain the
same in good repair and working order as herein-
before in this Section provided. Such rates shall
be fixed and revised from time to time so as to pro-
duce these amounts, and the governing body shall
covenant and agree in the ordinance authorizing
the issuance of such bonds, and on the face of eaeh
bond at all times to maintain such rates for serv-

ices furnished by such system, project or com-

bined system as shall be sufficient to provide for,the

foregoing. | ae
Section 22. Bond and Interest Redemption

Fund—Qperation and Maintenance Fund—Depre-

. ciation Fund—Contingent Fund.—In the author-

izing ordinance the governing body of the -bor-
rower shall set aside monthly (or oftener if deemed
advisable) and shall pledge the gross revenues of
the system, project, or combined system into sepa-
rate and special funds as follows: Out of the gross
revenues there shall be first set aside a sum suffi-
cient to pay the principal of and the interest upon
the bonds as and when the same become due and
payable. In tke event that the gross revenues of

. any calendar, operating, or fiscal year shall:be in-

sufficient to pay the principal of and interest on the
bonds maturing in any such calendar, operating, or
fiscal year, then an additional amount sufficient to
pay the principal of and interest on such bonds out-
standing and unpaid shall be set aside out of the
gross revenues of the next succeeding calendar, op-
erating, or fiscal year and applies to the payment of
the, prineipal of and interest on such outstanding
and unpaid bonds. This fund shall be designated:

_ “Bond and Interest Redemption Fund.”? Out of .

the remaining gross revenues there shall be next set
aside a sum sufficient to provide for the payment of

~ all expenses of administration, operation, and such

expenses for maintenance“As may be necessary to
preserve the system or combined system in good
repair and working order. This fund:shall be des-

ignated ‘‘Operation and Maintenance Fund.’’ Out

of the remaining gross revenues there shall be next
set aside a sum sufficient to build up a reserve for |
depreciation of the existing system or combined

. * system. This fund shall be designated ‘“‘Deprecia-

tion Fund.’’ Out of the remaining gross revenues

_ there shall be next set aside a sum sufficient to build

up a reserve for improvements, betterments, and
extensions to the existing system, project, or com- .

4
69

‘bined system other than those necessafy to main- -
tain the same in good repair and working order-as
hereinbefore provided for. This fund shall be des-
ignated ‘Contingent Fund.’’ Any surplus reve-
nues thereafter remaining shall be disposed of by
. the governing body of the borrower as it may deter-
mine from time to time to be for the best interest of
the borrower. Provided, However, that insthe se-
gregation and separation of said gross reyenues -
into the several funds in this Section stated, the
governing body may prescribe a reasonable excess
amount to be placed in the Bond and Interest Re-
demption Fund from time to time during the
earlier years of maturities of such bonds as thereby
to produce and provide a cushion fund to meet any
possible deficiencies therein in maturities of future
years, and in the event that such excess amounts are -
thus provided, provision may be made in the ordi-
nance for the scaling down of the amounts of such |
future years in the event the surplus so provided in
the earlier years may then be found to have been
accumulated and to be available. Bonds issued
under the provésions of this Act, shall be payable .
solely frem the revenues in said Bond and Interest
Redemption Fund. sce i
Sporion 23. Payment Expenses of Operation or
Maintenance.—Nothing in this Act shall be con-
strued to prohibit the borrower from appropriat-
ing and using any part of its available income or
revenues derived from any source other than from
the operation of such system, project or combined
system in paying any immediate expenses of opera-
tion or maintenance of any such system, project or
combined system, but, nothing in this Act shall ‘be
construed to require the borrower to do so.

70

Secrion 24. Custodian of Gross Revenues—
Trust Funds.—The governing body of the borrow-
er shall ‘designate as custodian of the gross reve-
nues from the operation of.the system or combined
system a bank or trust company duly qualified and
doing business within the State of South Carolina,

- which Shall be satisfactory to the governing body of
such borrower. The Bank or trust company shall
signify its acceptance of such custodianship by a
written instrument directed to the governing body
of the borrower.- ‘All funds from time to time de-
rived from the operation of such system, project,
_ or combined system, or funds of the borrower sup-
_ plemental to the Operation and Maintenance Fund,
- the Depreciation Fund and/or Contingent Fund
shall be deposited by such bgrrower with such bank
- or trust Sompany and be set apart by such bank or
trust company pursuant to written instructions
from such borrower into the appropriate‘tund or
funds designated in Section 22 of this Act. Each
- and all of said designated funds from time to time
held by such bank or trust company shall be im-
pressed with a trust for the benefit of the person
or persons entitled thereto. 9
+ SercTion 25. Year Basis.—The wnlbenhes author-
izing the issuance of such bonds shall definitely de-
termine whether-such system, project, or combined
system shall be operated upon a calendar, operat-
ing, or fiscal year basis, and the dates of the be-
ginning and ending of same.
Section 26. Surplus: in Operation and Mainte-
- nance Fund—Disposition.—If any surphus shall be
‘accumulated in the Operation and Maintenance
Fund whieh shall be equal to the cost of operating
and maintaining such system, project, or combined

‘ >

a
71

ait

system during the remainder -of ‘the calendar,
operating, or fiscal year, as provided by the author-
izing ordinance, arid the cost of operating and
maintaining such system, project, or combined sys-
tem during the succeeding like calendar, operating,
or fiseal year, any such surplus may be transferred
at any time by the governing body to the Deprecia-
tion Fund, Contingent: Fund, or to the Bond and
Interest Redemption Fund.
Section 27. Surplus in Depreciation Fund—
Disposition —If any surplus shall be accumulated
«. in the Depreciation Fund ‘over and above that
which the governing body shall find may be neces-
sary therein during the then present . calendar,
operating, or fiscal year and the next ensuing cal-—
endar, operating, or fiscal year, any such excess may
be'transferred to-the Contingent Kund or the Bond
J avt-Interest Redemption Fund. .
Section 28. Surplus in Contingent Fund—Dis-
position.—If any surplus shall be accumulated in

the Contingerit Fund over and above that which |

__ the governing body shall find may be necessary for

‘ reasonable and proper improvements, betterments,
and extensions to the existing system or combined
system during the present ealendar, operating, or
fiscal year and the next ensuing calendar, operat-
ing, or fiscal year, any such excess may be trans-
ferred to the Bond and Interest Redemption Fund:
or may be applied,.in so far as possible, in the
purchase or retirement of outstanding bonds issued
under the provisions of this Act, and for that pur-
pose the governing body is authorized to purchase |
such bonds not due ig the open market at not more

. than the fair markét value thereof. “Where such
bonds are purchased for investment the income

72

from such investment shall be carried into the
Contingent d. -
Section 29. Regulation of Rates—Franchise—

No Effect on State’ Board of® Health _—Rates

charged for services furnished by any system or

combined system purchased, consffucted, im-.

proved, enlarged, extended, or repaired under the
provisions of this Act shall riot be subject to super-

Vision or regulation by any State. bureau, board,
commission, or other like instrumentality or agency

thereof, and it shall not be necessary for any bor-

- rower, opefating under the provisions of this Act

to obtain’ any franchise or other permit from any
State bureau, board, commission, or other instru-
mentality thereof in order to construct, improve, —
enlarge, extend, or repair any system or combined
system named in this Act. Provided, however, —
That the functions, powers,-and duties of the State

- Board of Health shall remain snaiincied by this |

Act.
‘Srorion 30. Books and Missi daawial Re-
port-——Inspection.— Any. borrower issuing revenue

.bonds under the provisions of this Act shall install

and mainthin proper books of record and account
(separate entirely from other records and accounts
of such borrower) in which full and correct entries
shall be made of all dealings or transactions of or.
in relation to the properties, business, and affairs
of the system or combined system. The govern- .
ing body of such borrower, not later than three
months after the close of any’calendar, operating, —
or fiscal year, shall cause to be prepared a balance °

- sheet and an income and surplus account, showing,

respectively, in reasonable detail the financial con-

' dition of the system or combined: system at the

ve
73

close of sucy preceding calendar, operating, or fiscal
year and the financial operations thereof during
such year. Said balance sheets and income and
surplus accounts shall at all reasonable times
- ing usual business hours be open to examination
and inspection by any taxpayer, user of the services —
- furnished by the system, or any holder of bonds
issued under the provisions of this Act, or anyone
acting for or on behalf of such taxpayer, user of
the services of the system, or bondholder.
Section 31. Pay Bonds Before Maturitires.—
Thé governing-body of the borrower authorizing
bonds. under the provisions of this Act may make -
provision for-any of such bonds to be called for
payment on any interest payment date before ma-

. turity, provided the borrower shall have on hand

in its Bond and Interest Redemption Fund suf-
ficient moneys not otherwise appropriafed or
pledged, in excess of the interest and principal
requirements within the’next two succeeding calen-
_ dar, operating, or fiscal years.

Section 32. No effect on Existing Contracts and
Liens.—Nothing in this Act shall be construed as
authorizing any borrower to impair or commit a
_ breach of the obligation of any valid lien or con- ~

tract created or entered into by it, the intention
hereof being to authorize the pledging, getting
-aside, and segregation of gross revenues only where
consistent with outstanding cian of such
borrower.

SecTIoNn 33. Issue Bonds without Election, or No-
tiga.—This Act shall be construed as authorizing
the issuance of such bonds provided for herein —
without submitting the proposition for the ap-
proval of same to the voters of the borrower.

a) 0 —- wy

Ss MP ,
>. ' 6 ~

Where bonds are authorized under this Act it shall

not be necessary to make publication of any ordi-
nance, resolution, notice, or proceeding relating
thereto. Pxbvided, however, That nothing in this
‘Act shall be construed to prohibit the governing
body from making such publication as it may deem
-necessary in relation thereto,
Section 34. Construe Liberally.—This Act, we
_ ing necessary. for and to secure the public health,
“ safety, convenience, and welfare of the counties,
townships, cities and incorporated towns of the
Statesof South Carolina, shall be liberally &on-
struéd to effect the purposes hereof. :
Secrion 35. State Bond Commissioner—Du-
ties—Time to. Test Validity of Bonds. —For the
protection of purchasers of any bonds authorized

aa pursuant to the provisions of this Act, fhe Attorney!

General is hereby made Ex-officio Bond Commis-
sioner of the State,of South Carolina, It shall be
the duty of such Bond Com-aissioner to prepare
uniform forms and prescribe a method of proce-
dure under the laws of th State in all cases where

_ it isfiesired to issue said bonds in any county, town-

p, city, or incorporated town of the State of
South Carolina; and it shall he the-further duty of
said Bond Commissioner to examine into and ‘pass

‘ upon any of said bonds so issued, and said bonds,

when declared by the certificate of said Bond Com-
missioner to be issued in aecordance with this Act
and the forms of procedure so provided, shall be
incontestable in any court in the State of South
Carolina unless suit thereon shall be brought in a

-. court having jurisdiction of the same within thirty

(30) days from the date of the approval of said
bonds by the Bond Commissioner. “No bond here-

o ° ->

~~.

a : ' “Att a

. 75

after issued by any county, township, city, or in-
corporated town pursuant to this Act shall be valid
.. Without the certificate of said Bond Commissioner.
- © §gcrion 35-A. State Sinking Fund Commission
. Approve Bonds.—All Bonds authorized pursuant _
to the provisions of this Act shall be subject tg the —
approval of the-Sinking Fund Conimission of the
State of South Carolina and no bonds issued under
the provisions of this Act shall be valid without
the certificate of approvaf of the Sinking Fund
Commission. aan 7 |
“Secrion 36. Saving Clause —They invalidity of.
any section¢sentence, clause, paragraph, or portign.
of this Act shall not affect the validity of the
remainder of this Act. ae
rag ‘are
Acr No. 1095 or THE 1934 AcTs oF THE GENERAL
ASSEMBLY OF THE STATE OF SOUTH CAROLINA *

AN ACT to Authorize and Empower the Finance Board for Green- ‘

wood County to Contract with the Public Works Administration; —~ :

to Perform such Acts and Duties as may be Necessary and Incident
to Securing a Loan, or Loans, for a Hydro-Electric Project; to’
Define and Limit its Duties and Powers; to Empower the said
Board to Borrow Pursuant to Aufhority Conferred by any Other
Statute for the Named Herein and Especially Undér the —
Provisions of an’ Act Entitled “An Act to Authorize any County,
nag yoy or Incorporated Town, Etc.” Designated as Act
No. 209 o \the Acts of the General Assembly of 1933.
Sxcrion 1. Finance Board, Greenwood County, ”
. Borrow for Hydro-Electrie Plant.—Be tt enacted -
by the General Assembly of the State .of South
Carolina: That the Finance Board of Greenwood
County is authorized and empowered to borrow .
from the Public Works Administration, or any
other agency or*corporation, organized under the ©
Federal Government or pursuant to any Act of the
Congress of the United States, the proceeds of any

:

erger oT

at a Ge

82

if that project competed i in any way with an
existing enterprise?

Mr. Austin. Yes, of course, it would.
That is just the point. The waste of money
in putting up a competing line of rural elec-

trification is one of the things the amend- - °

ment would prevent.
Mr. Byrnes. How about the construction

‘of a housing project?

Mr. Avustiy. It would depend upon where

‘it was located and whether it would compete.

Mr. Byrnes. If a housing project were
constructed at a place where other houses
were rented, would the Senator say it was
in competition with the landlords who owned
the other houses ?

‘* Mr. Austin. Not unless it’ ‘competed —_
private enterprise.

Mr. Bark ey. Mr. President, of course ‘it
would compete with private enterprise if
people rented the- houses which were, con- .

structed under a housing project. If they “.

did not rent the houses constructed under

the project they might be forced to rent some:

se houses. That would be competition;
it not?

i Austin. That does not necessarily

follow. A housing project which was not
in a place where houses were already in .

existence would not be in competition with
other houses.

Mr. Barkizy. A housing project is not
going to be undertaken out in the middle of

. a vacant field. It would undoubtedly be in

a city or town. It is difficult to see how a
housing project in a thickly settled city
might not, when completed, compete with
some private houses already there.

Let us suppose that in some city, town, or

| village there is a water nem, owned by a

83

private organization, which is inadequate to.
serve the citizens. Under the’ Senator’s
amendment it would be impossible for the
_ municipality. to install a water system which
would serve the community because one was
already there, although it was inadequate to
serve the community. Tee ky Be
Mr. Austin. I grant that is a possibility. ©
Of course, one can by-a stretch of the imagi-
riation picture a situation for which the
amendment would not be ideal, but I have in
- mind projects for manufacturing and retail
businesses engaged in various ‘activities
which have been heretofore simply left. to
private enterprise—enterprise that provides
. the taxes which will go to pay the sums ap~-
propriated by this measure. It is to prevent
an enormous amount of capital being thrown
- into competition with private capital that I
offer the amendment. I ask for a vote. —

In the foregoing debates, reference was made to
Section 7, which was adopted by Congress but |
which, when the Bill was finally enacted, became —
Section 8. That section reads as follows: ‘*When-
ever practicable in the earrying out of the provi-

_ sions of this joint resolution, full advantage shall
be taken of the facilities of private enterprise.”’

The following debate (79 Cong. Rec. 2396) clearly
shows the meaning of that section: .

Mr. McCarran: * * * This amendment
was suggested by those who had been en-
gaged in the contracting business through- .
out the country. “They feared that perchance
the contractors, who have $1,600,000,000 in-
vested in various lines of employment,
might be entirely left out; so they sought a.
general amendment, which I offered in the
committee, and it was adopted to the extent ©

1 A TOTES

OR OREN, IMME EE I IIE LP POLLO ALLA IL ID

"84

and in the language stated, that, wherever

practicable, the facilities of private enter-
prise should he resorted to. That simply

means, as in the building of highways -

throughout the country today, we have high-
way-construction engineers or highway-con-
strucfion- groups, with their equipment, all
ready to go td work, that, if the President
wishes, and . thinks it practicable, he may

call upone them so far as their facilities

‘permit.
‘That is the object of the amendment. I
was not the author of it, but I did sponsor
it, and I sponsor it now, in furtherance of
. giving to the contractors of thé country an
opportunity to employ labor they have car-
ried, during the hours of depression, many

of them keeping their equipment and labor |

contingent, on at a terrific loss. Wherever
it is. practicable, the amendment provides
that their facilities shall be utilized.

That is the explanation of the amendment.”

If the Senator has.any further questions, Lt

shall be glad to answer them. I again apolo-
gize to the Senator. I was not giving atten-

tion to his question, and I am very sorry.

Mr. Bone. Mr. President, the Senator:

. from Nevada owes me an apology. There
was a great deal-sf confusion in the Cham-
_ ber when I asked the question. I can un-
derstand why everyone would be confused ;
but I know that these words have meaning,

and that some interpretation is going: to be -
given them by those who will construe the:

fan int resolution, especially by those in

ashington, D. C., who are aa to dis--

burse this money.

Mr. McCarran. That is true.

Mr. Bone. I want to be absolutely certain.
that these words are not misinterpreted to

AL ABER IGE EL EOL SES

85

br disadvantage of my State or any other
aaa 0 Ve
9 Mr. McCarran. That is the object and -
purpose, and that is the whole idea behind
the amendment. _ ©
Mr. Bone. These words may be construed
absolutely to prohibit force-account work
wherever it is possible ‘to/let contracts. Is
that the Senator’s intention? ,
Mr. McCarran.. That is the object. |
Mr. Gass. No; wherever it is practicable.
~ Mr. McCakRan. Wherever practicable, ~
Mr. Bone. Very well, so long as we under-
stand that. We desire to know what we are
doing when we vote ‘‘yves’’ or ‘no.’
‘he Vick PRESENT. The question is on
agreeing to the committee amendment known
- as “section 7.” : %
The amendment was a

‘“©Work UNDER
EacH PARTICULAR Progect’’ IN THE 1935 AcT

priation Act of 1935), was pending before the Sen-
ate, there was considerable discussion of the mean- _
ing of the words ‘‘direct work’? which appear in
subsection (g): of section 1 thereof, said section -
then reading as follows:

(g) Loans or. grants, or both, for projects
of States’ Territories, possessions, includ-

ing subdivisions and agencies thereof, and
self-liquidating projects of public bodies
thereof, municipalities, and the District of

Columbia; where not less than one-third

96

a of the loan or the-grant or he aggregate
: théxeof is for expenditureséfor direct work,
$900,000,000 ;

The position of Senator Giass, Chairman of the
Senate. Appropriations Committee and one of the
managers on the part of the Senate in the confer- _
ence, as to the meaning of these words, is indicated

_ by the following colloquy between him and Senator
Copeland pn the floor of the Senate, which appears
in the Congressional Record (79 Cong. Rec., 4746) :

Mr. Guass. Mr. President, section 3 of the
joint resolution, as it went to conference,
was wholly an insertion by the Senate it-
self; no word of it was in the joint resolu-
tion as passed by the House; but the House
conferees undertook to alter that provision
of the joint resolution in various respects,
and, with the assent of the Senate conferees,
succeeded in doing so.

At the last, having their attention drawn
to the fact tha under the. section as it stood
the entire amount of $900,000,000, with such

addition as, the President might please to

} make to the amount, in his discretion, under

W\ . the 20 percent permission, might ‘be ex-

pended without employing a single human

-being in addition to those already now em-

ployed, the Senate conferees undertook to

. . write into the provision a requirement that

' this money should not be loaned to States,

; municipalities, and subdivisions of States or

the District of Columbia unless the project

for which the money was loaned involved

- the expenditure of one-third of the amount
for labor.

As I stated in my letter to the Secretary, |

he has fallen into the error, which has been .

spread broadcast in the Washington news-

papers, of asserting that the zneasure’ re-

. .
Be le Soe ee ee . . ¥

87 re
quires that one-third of the labor shall be
done on the site of the project. There is not
a word or sentence in the report of the con-

. ferees which justifies any such assumption.

~On the contrary, the conferees took the view
that any work entering imto a given project
for which any part of the $900,000,000

-_ should be loaned should be counted in esti-
mating the one-third required to be ex-
pended on direct labor,.*: r

In order to make syifé that that was a cor-

rect interpretatiop of the provision, the con-
-ferees asked the Comptroller General to
come before them, to examine the provision,
anid to give his interpretation of it. He told
us that the interpretation of the Senate con-
ferees was his interpretation and that he —
should feel obligéd so to rule in any matter
that might come before him for decision.

Mr. CopeLann. Mr. President—— | 4

The PresipeENT. pro tempore. Does the
Senator from Virginia yield to the Senator
from New York? .

Mr. Guass. Certainly. .

Mr. CopeLann. The Senator from Vir-
ginia might state also that, while it was pro-
posed by someone in the conference that the
language should be further restricted to re-
quire one-third of the work to be done at
the site, the proposal was overwhelmingly
“thrown out of the window.” -,

Mr. Guass. Yes. To show that the Senate
conferees had not in mind in the text of th
report or in thé spirit of it to require that
the one-third of the direct work should ap--
ply to the site of the project, that proposal
was made and almost unanimously rejected
by the conferees. The purpose of the con-
ferees was to require that when any part of
the $900,000,000, plus whatever might be

ss) 88

added to it, should be doaned to a State or
‘ eommunity or subdivision of a State for a
“project, the project must involve enough .
work to consumg one-third of the loan. |
-As I stated in my letter to the Secretary,
for example, if a waterworks plant should
‘be erected out4of money-loaned from the
$900, 000,000, not only must the work on the
site make upia part of the one-third expendi-
ture, but.all the work on a motor be manu-
| factured a thousand miles away or on other
machinery manufactured far away, and ie
work involved in the transportation and th
_ . handling of the machinery that related itsel
—~ to the particular project for: which the
amount should be loaned would be counted.

Because of the uncertainty as to the meaning of
the words ‘direct work”’, the bill was sent back
to conference. . In conference subsection (g) of
, section 1 was changed to read as it now does, and
‘Congressman Buchanan, Chairman of the House
Appropriations Committee, and one of the man-
agers on-the part of the House in such conference,
' made the following official ’ statement on the floor
of the House as-to the meaning of the words ‘‘ work
under each particular i haa (79. Cong. Ree.
5145) : |

The expression “work under each particular
project” includes not only work done at the site
of the project but work which may properly be

_ called, “indirect” work, for example, the work
- which is created by the manufacturer and produc- |
-tion of mate and in the transportation of
such mater. to the site of the project.

89
3 aan jf

TH Provision RELATING TO THE PuBLIC WORKS
ADMINISTRATION CONTAINED IN THE, First. DE-
FICIENCY APPROPRIATION AcT, FiscaL YEAR 1936;
DEBATES THEREON; AND STATEMENT BY THE
CHAIRMAN OF THE House CoMMITTEE ON APPRO-
-PRIATIONS IN ExPLANATION OF THE PROVISION

The following provision relating to the Public .
Works Administration is.contained in Title IT of
the First Deficiency Appropriation Act, fiscal year
. 1936, and is the basis of the contemplated public
works program:, é :

In order to inérease employment-by pro- .

- viding for useful public-works projects of
the kind and character for which the Fed-
eral Emergency Administrator of Public
Works: (hereinafter called the Administra-
tor) has heretofore made loans or grants
pursuant to title II of the National Indus-

_ trial Recovery Act or the Emergency Relief
‘Appropriation Act of 1935, the Administra-
tor may, upon the direction of the President, —
use not to exceed $300,000,000 from funds
on hand or to be received from the sale of
securities, for the making of grants to aid
in the financing of such projects: Provided,
That no part of the sum made available by
this paragraph’ shall be granted for any
project unless, in the determination of the
Administrator, the completion thereof can
be substantially accomplished prior to July .

- 1, 1938, and adequate provision has been
made or is assured for financing such part
of the entire cost thereof as is not to be sup- .
plied through the Federal Emergency Ad-
ministration of Public Works: Provided
further, That this limitation upgn time shall

{
\

90
_ not apply to any project enjoined in any
Federal or State court: Provided further,
‘That in no ease shall the amount of the grant
~* exceed 45 percent of the cost of the project.
Nothing herein shall be construed to increase
the amount of notes, bonds, debentures, and
other such obligations which the Reconstruc-
tion Finance Corporation is authorized and
empowered under existing law to issue and
to have outstanding at any one time,«and
nothing herein shall be construed to limit |
or curtail in any way any powers which the
Federal Emergency Administration of Pub-
lic Works or the Administrator is now au-—
thorized to ex ‘rcise.

Originally the bill contained a proviso that
money should not be granted if the project could

not be completed prior to July 1; 1937. That was
’ amended to extend the period to July 1, 1938.
Subsequently there was inserted the proviso that
the limitation upon’ time should not apply to any
project enjoined in any federal or state court. The
following debates in the Senate with reference to
those amendments show that there was clearly in
mind competing municipal electric power projects:

_* Mr. Norris. - Let me suggest to the Senator

from Kentucky, when he modifies his amend- .
ment by inserting ‘‘1938”’ instead of ‘‘1937,”’
that many of the projects are now held up
by injunctions which,are pending. As to
some of them the injunctions will not be
-disposed of in time to enable them to avail
themselves of the. grant.

Mr. BaRkLEy. I have in mind a city whose
council called an election to vote bonds to
comply with the requirements of the Gov-
ernment in order to build a waterworks
plant. An injunction was obtained against

91

‘the election, and the election has not as yet -

been held because the case has not been de-
cided. Certainly another yvear is ngt too
much to ask in behalf of the community
restricted in such.a way. ~~

Mr. Norris. I have in mind the case of Jackson-
ville, Ill. Bonds were voted after full discussion

of the matter before the people, but in that case ©

it was a question of constructing 4 municipal
electric-light plant. The power interests ob-

tained an injunction after the bonds had been —

voted (80 Cong. Rec. 8491.) = ©

- Mr. McKettar. My. President, immedi-
ately after the date ‘‘1938,’’ I propose to
insert the following:
-“ Provided, That this limitation shall not
apply to auy project that has been enjoined

in any Federal or State court.”’ —

The reason for offering this limitation is

that many injunctions have already been
granted, and it would be unfair and unjust
to deprive the particular communities where

that has been done from receiving this relief. »

The Presipine OrFicer. The Senator from
Tennessee offers an amendment to come at
the end of the amendment offered by the
Senator from Colorado, which will be stated.

The Cuter CLERK. It is proposed to insert
the following after the amendment to the
amendment just agreed to:

‘‘¢ Pravided, That this limitation shall not
apply to any project that has been enjoined
in any Federal or State Court.”’

Mr. Boran. Mr. President, what is the
effect of the amendment?

Mr. McKellar. I will give an illustration. The

_ city of Knoxville, Tenn., applied for a loan and a
grant to build an electric light plant, and they
were enjoined by a private company. If the
limitation as carried in the bill shall continue in
force—and it will be in force, of course, unless

aw a anette

92

_ the injunction is dissolved in time enough to per-
mit them to build the plant—they cannot build —

_ the plant at all. It might be held up on appeal,
so that Knoxville would be deprived entirely of
the relief. .

Mr. Glass. Has the plant been let to contract?

Mr. McKellar. No, the plant has not been let
to contract; before that could be done, the in-
junction was issued. There are a number of such
cases, and it seems to be manifestly fair and just
that the limitation should. not apply to cases of
that kind.

Mr. BaRKLEY Mr. President, the amend-
ment simply limits the expiration of the
time ?

Mr. ee That is all. I ask fora
vote on the amendment.

The PresipING OFFICER. The question is
on agreeing to the amendment offered by the
Senator from Tennessee to ‘the amendment
of the committee.

The amendment to the amendment was
agreed to. [Cong. Rec. 8499-8500. ]

The following statement was submitted by the
Chairman of the House Committee on Appropria-
tions and read into the record by the Clerk of the
House in explanation of the above-quoted provision
relating to the Public Works Administration for
the purpose of declaring the intention of the Con-.
gress in enacting such provision (Congressional
Record, June 17, 1936, House of Representatives, —
page 9889) (80 Cong. Ree. 9791) : |

RE FIRST DEFICIENCY APPROPRIATION BILL, FIS-
CAL YEAR 1986, INSOFAR AS IT RELATES TO THE
"PUBLIC. WORKS ADMINISTRATION

The bill as it passed the House of Rep-
resentatives contained no provision concern-
ing the Public Works Administration. The

_ Senate added a paragraph which authorized

we

93
the. Federal Emergency Administrator of

. Public Works, upon the direction of the -

President, to use not to exceed $300,000,000

from funds on hand, or to be received from.

the sale of securities, for the making of
grants to aid in the financing of projects ca-
pable of being substantially completed, in
the determination of the Administrator, not

later than June 30, 1938. The amount of —

grant which could be made for any project
was limited to 45 percent. >

' The purpose of this provision is to per-

mit the Federal Emergency: Administrator

of Public Works to use the cash and credits

~ now in the Public Works Administration

revolving fund for an additional public-

works program to supplement .the work-
relief program to be carried on. Since,

under existing law, the moneys in the Public
Works Administration revolving fund are
available only for loans, for the past year
the Public Works Administration has been
making loans from this revolving fund and
grants from rescinded allotments made
from the appropriations to carry out title

II of the National Industrial Recovery Act -

and from the $345,000,000 allocated to the
Public Works Administration by the Presi-
- dent from the $4,880,000,000 appropriated to
carry out the Emergency Relief Appropria-
tion Act of 1935. |

The provision added by the Senate is not
- intended to disturb the use of the revolving
fund for such loans as are authorized under
Public, No. 412, Seventy-third Congress, and
under the Emergency Relief Appropriation
Act off1935, but it confers supplemental and
‘additional powers upon the Administrator

and does not curtail any of his present

powers or functions.

+5

The Senate amendment contemplates that
the Public Works Administration will make
loans for non-Federal publie-works projects
in the amount of 55 percent of the cost of the
project out of its revolving loan fund and
will supply the remaining 45 percent as an
outright grant. In cases where applicants

_ are able to provide their share of the cost of —

tie projects from the sale of municipal -
bonds on the open market, only a grant will
-be made by the Public Works Administra-
tion.

The first change which the conferees have
made to the Senate amendment has been the
deletion in the first and second lines of su-
perfluous language relative to relief and
work relief so as to make perfectly clear that
the purpose of the paragraph is to enable the

~ Public Works Administration to follow a
well-beaten path by providing aid in financ-
ing a non-Federal public-work program.
_ This provision in the Senate amendment is
also intended to serve as a standard ‘for
guiding the Administrator in the selection
of types of projects to be financed under the
~ amendment.

Another change made by the conferees in
the Senate am ndment has been to rephrase
the limitation on the time within. which. it is
estimated that a project will be completed
‘in order that it may be eligible for a grant
under the.bill. The purpose of this change
is to make clear that no part of the funds
made available by this paragraph shall. be
granted for any project unless the Admin-:
istrator has determined that the completion
of the project can be substantially accom-
plished, in his opinion, prior to July 1, 1938,
and also to prohibit the use of any ‘funds

under this paragraph to“finance any project
unless, jn the judgment of the Adminis-
trator, the conten has on hand or is able
to f ap gy Snot rT sys it =
provide e of the 0 project: |
7 It is exp. that ander this provision the
Public Works ae ti Doe will be en-

| abled ing to carry ona 000,000 non-F'ederal
lic W, rogram. - It is contemplated -
iat this wil done by the Public Works

, inistration agreeing to make grants an
loans from its unobligated funds on_hand
and against commitments from the Recon-
sfruction Finance Corporation. The Public
orks Administration on will be able to enter
into a contract to make a gr or to pur-
chase municipal honds in a ce upon a
oe by the Seneca imuance
; oration to purchase bonds from the .
| Publ orks Administration in a like
ple :
_. Under existing law the only limitation is
- the limitation upon the amount of bonds
purehased from the Pyblie Works Admin-

- istration which the Heconstrnction | inance

Corpcration may hold at one time.
This amount is limited to {000,000 by
_ Public, No. 412, Seventy-third Congress. It
is an that through the cooperation
of the truction F ¥ Rorporation
it will Je for the orks Ad-
ministration to use from its ing Tud

the $300,000,000 made available under this
paragraph of the bid for grants and an ad-
ditional amount of about. ¥150,000,000 for
loans, but the Senate ame nt does not
in any ay ee restrict che present power of the
orks Administration ‘to resell on
rng open market bonds it has purchased.

27949—37——_7

ou

Zz
ake

;

To summarize: Under the Senate amend-
ment, as modified by the conferees, the Pres-
ident is given power to authorize and direct -
the Federal Emergency Administrator of
Public Works to use $300,000,000 from the
revolving fund for the making of grants for
projects selected by the Administrator, and
to use funds on hand and funds to be received
from the resale of bonds for the making of
loans for such projects. It is anticipated
that the Administrator will be empowered .
‘to make these grants and loans subject to
such terms and conditions as he may pre-
scribe in order to carry out the purposes of |
the Senate amendment. The Administra-_
tor will, of course, continue to exercise the
functions which he has been heretofore au-
thorized to perform. under title IT of the
National Industrial Recovery Act and under

_the Emergency Relief Appropriation Act of —

4.

INCLUSION OF GENERATING PLANTS AND DiIsTRIBU-
TION SYSTEMS WITHIN THE MEANING OF TITLE II
OF THE NATIONAL INDUSTRIAL RECOVERY ACT

‘During the discussion of the conference report
on the National Industrial Recovery Act on the
floor of the Senate, the following colloquy took
place between Senator Norris and Senators Harri-
son (Chairman of the Senate Finance Commitee)
and Wagner (who was one of the Senate Con-

ferees). Congressional Record, Volume 77, part 6,

The Siunate resumed. the consideration of
- the report of the committee of conference on

oe

97

the disagreeing votes of the two Houses on
the amendments of the Senate to the bill
(H. R. 5755) to encourage national indus-
trial recovery,.to foster fair competition,.
and to provide for the construction of cer-
tain useful public works, and for other pur-

poses. |

Mr. Norris. Mr. President, in the brief
time which I shall occupy the floor 1 want
first to call attention to an amendment —
agreed to in the Senate and which has gone
out in conference. It is amendment num-
bered 44, found on page 19. The bill pro-
vided, in subsection (b) of section 202, as
follows: ) 7

*(b) Conservation and development of.
natural resources, including control, utili-
zation, and purification of water, construc-
tion of sewage-disposal plants, widening of
streets, prevention of sewers and soil or
-.ecoastal erosion, development of water
‘power, transmission generation, transmis-
sion, and distribution of electrical ey ol

An amendment was inserted on thé floor
of the Senate to add after the word “‘trans-
mission’’ the words “‘generation and distri-
bution.’? I supposed, when that addition
was made, that there could be no possible ob-
jection to including those words. I do not
yet see how anyone who would be willing to
put in the word ‘‘transmission’’ would not
also agree to having inserted the words “gen-
eration and distribiition.’’

Mr. Harrison. Mr. President——
_ The’ Presmpine Orricern (Mr. Barkley in
the chair). Does the Senator from Nebraska
yield to the Senator from Mississippi?

Mr. Norris. I yield.

Mr. Harrison. I was in entire sympathy
with the amendment offered by the Senator,

Oo

8

and tried to retain it-as it was written in the
bill, buf the conférence wis told that that
wes ‘inchided itt the other ptovisioyis of the
bill; that théte was not the slig doubt
about the generation and distri ion, aS
well as tranemission, being taken. care of ©
under the general provisions of tHe bill.
M>. Nownw. Mr. President, of course, I ac-
me the Senator’s statement at 100 percent,
as # matter of fact; while I think the

~ position taken by the Senator’s informant

as to gehetation being included by eonstruc-
tion may be tenable, there is absoltite cer-
tality, it seetns te me, that distribition will

’ -be omitted from the terms. of the bill. In

fhe electrical world there-are two distinct
things that happen as to the electricity which

- is generated ; first, there is the transmission ;

theti there is the distribution. It is gener- -
ally understood; ‘80 far as I know, without

_ exteptien,; by engineers that -

does tiot ihehide distribution. Transmis-

sion méans the eatryiig of electricity from
the place where it is generated to the place
where it is distributed. That is transmis-
sion. For instanee, if electricity were gen- —
erated at Great Falls, ahd the eleetricity

were brotight to the city of Washitigton, the

bringing of the eleetricity to the city would ©
be trarismissién, but when it was furnished

~ to the people within the city that would be -

distribution atid wotild not be included in the
term ‘‘transmissioti’’; so that, as it now
stands, E do hot believe there ‘would be any
authority for a minicipality which wished to
distribute eleetficity to its own citizens to
eome tinder theterms of the bill.

Mr. Harrison. May-I say to i Senator
that we inquited specifieally of General
Johnson, who was present, as to that,.and he

oy, the purpose of bitilding ttanstiission lines:

said there was no (question about it it. “That

~ the only peason why the word was
stricken out May I say ¥ to the Senator also
was for

imeluding i it in the bill because

a , pager.

a | ed the matter over with
thie Senator from ew York before I offered
the a Ht then had his full con-

curtehee, and 7 have n6 doubt the Senator |

yet entertains the same view.

Mr. Waanen. I Will say to the Senator that
I think the term shotild have remained in
the bill as fhe Senator proposed it; but, after

am sure any pitblic project of a municipality,
State, or any at Ped itioal ey of 0m is
pr ded, atid as the bi I now stands there is

nly atithority for ‘the Joan of money for

such 88 the Senator Has in mind.
- Mr. Nowkis. The building of a transmis-

sion line is entirely different ore ‘a
the blog of

tioti Tine. I ate to section 200.
Mr. Gworce.. May I calt the Senator’s at-
tention to the lan guage iti seetion 202?
Mr. Norris.

. Georgia.

Mr. Grokar. In section 202, line 5, after
deseribing public works, the language i is:

.. “And any publiely owned insttumental-.
ities and facilities.”

P — , Nonnis. Where is that language
¢. WAGNER. That #s the section I wanted
to cail the. Senator's attention to.
Mr. Gzorer. It is section 202 6f the bill,
page 19, line 5.

yield to the Senator from.

all, under «genera al provision of the bill I.

—— y
SY
e

_ . publie buildings (including the remodeling

has been called.

' . “distribution”? was omitted, it seems to me

rated
Pa

100

Mr. Norns. The language of. the bill, be-
ginning inline 2, page 19, is as follows: -Y
es Construction, repair, and improve- -
ment of public. highways and parkways,

of buildings hereby authorized. to be pur-

chased for Federal purposes), and any pub-

liely owned instrumentalities and facilities.”
Mr. Waener. I think, that language _

ers it. ; ;

‘Mr. Norris. I ao not beiow that siieidan
- the ‘distribution of electrigal energy; and, aie”
Mr. President, even if it\ did, we should
thereby lay the way open for an injunction,
to start with, by. privately owned power com-
panies. I do not see any escape from it.
Why not add the word ‘‘distribution’’?
‘‘Transmission”’ is already in the bill. Why.
include transmission if it is already in-
- eluded under the general terms of the bill?
And, if transmission be included, why not
permit the electricity to be distributed after
it has been transmitted ? =

Mr.. Waener. Of course, my opinion: al-
_ ways has been that these special provisions
were unnecessary, in view of the - general
provision to which the Senator’ s attention,

. My. Norris. If the ‘general provision ap-
‘plies, Mr. President, then none of this lan-
~ guage should have. been put in. It was put

in by the other House; it was in the bill

when it came to us, so far as transmission
was ‘concerned; and’ yet, if. the Senator’s
theory is correct, it was already in in lines
dS and 6, and specific inelusion was absolutely
‘unnecessary. The very fact that the word
‘‘transmission’’ was inserted and tl ° word

when it: comes to construing the proposed

‘act will be assigned as a reason to show that
‘‘distribution’”’ was intentionally omitted.
what was in the.minds of the conferees when
the word was omitted, but I will say, as one
who had a good deal to do with the legisla-
tion, that, so far as I am‘ concerned, I- feel
~ very certain—and I do not see how any
_ court or anyone construing the act can reach
any other conclusion—that under the gen-
eral terms ‘‘publicly owned instrumentali- |
ties and facilities’ transmission and distri- |
bution lines are adequately covered...

U.S. GOVERNMENT PRINTING OFFICE: 1937

~

Mr. Waener. Of course, I do not know |. |

SUPREME COURT OF THE UNITED STATES.

Nos. 84, 85.—Ocroser Term, 1937.

Aiabama Power Company. Petitioner, )
84 vs. ra ae
Harold L. Ickes, as Federal Emergency

: On Writs of Certiorari to
Administrator of Public Works, et al. |.

the United States Court
_ Alabama Power Company, Petitioner,> of Appeals for.the Dis-
85 ‘ vs. trict of Columbia.
Harold. Ickes, as Federal Emergency ;
Administrator of Public Works, et al.

[January 3, 1938.]

Mr. Justice SurwEeRLAND delivered the opinion oi the Court.

These cases involve certain ‘‘loan-and-grant agreements’? made
by the Federal Emergency Administrator of Public Works with
four municipal corporations located in the State of. Alabama. The
bills of complaint sought to enjoin the execution of these agree-
ments. Each agreement contemplates the construction of an
electricity-distribution system by the designated imunicipality, and,
_ to that end, the purchase, by the Administrator, of bonds to be is-
sued by the municipality and secured by a first pledge of the rev-
enues derived from the operation of the system. In No. 84 thirty
and in No. 85 forty-five per cent. of the cost.of the labor and
materials used in the construction are to be donated outright: The
authority relied upon for the loans and grants is that contained
in Title II of the National Industrial Recovery Act? as modified
and continued by the Emergency Relief.Appropriation Act of
1935.* Title I of the former act has been declared unconstitutional
by this court. Schechter Corp. v. United States, 295 U. 8. 495;
Panama Refining Co. v. Ryan, 293 U. S. 388. But we are here con-
serned not with Title I but with Title II of the act. So far as
material, that title provides: | ra

“‘See. 202." The Administrator, under the direction of the Presi-
dent, shall prepare a comprehensive program of public works,

10. 90, 48 Stat. 195, 200. | |

£C, 48, 49 Btat. 115, 119.

| _ the general public; (d) construction, reconstruction, alteration, or

2 2 I Cae RROD Pvecanan ts ae ae
é :

2. ; Alabama Power Co. vs. Ickes et gl.

which shall include among other things the following: (a) Con-
‘struction, repair, and improvement of public highways and park
ways, public buildings, and any publicly owned instrumentalities
and facilities; (b) conservation and development of natural re-
sources, including control, utilization, and purification of waters,
prevention of soil or coastal erosion, development.of water power,
transmission of electrical energy, . . . ; (¢) any projects of
the character heretofore constructed or carried on either directly
by public authority or with public aid to serve the interests of

repair under public regulation or control of ‘ow-cost housing and
slum-clearance projects; (e) any project (other than those in-—
- eluded in the foregoing classes) of any character heretofore eli-
' gible for loans under subsection (a) of section 201 of the Emer-
gency Relief and Construction Act of 1932, .s amended, wa
‘‘Sec. 203. (a) With a view to increasing employment quickly
(while reasonably securing auy loans made by the United States)
the President is authorized and empowered, through the Adminis-
‘trator or through such other agencies as he may designate or create,
(1) to construct, finance, or aid in the construction or financing of
any public-works project included in the program prepared pursu-
ant to scction 202; (2) upon such terms as the President shall pre-
scribe, to make grants to States, municipalities, or other public —
bodies for the construction, repair, or improvement of any such
project, but no such grant shall be in excess of 30 [by later act 45]
per centum of the cost of the labor and materials employed upon
such project; ae “
The bills of eondteink challenge the validity of the loans and
grants on the grounds, among others, that these statutory provisions
purporting to authorize such loans and grants are unconstitutional ;
and that, in any event, the loans and grants do not come within the
statutory provisions. ba
The injury which petitioner will suffer, it is onitemibil is the loss
of its business as a result of the use of the loans and grants by the
municipalities in setting up and maintaining rival and competing.
plants; a result, it is further contended, which will be directly
caused by the unlawful act of the administrator in making and
-consummating the loan-and-grant agreements. :
The suits were brought in the United States District Court for
the District of Columbia. There, the respondents, in addition to |
defending the validity of the action of the administrator, con-

~

——,

> Alabama Power Co. ve. Ickes et al. 3

tended, that petitioner was without legal standing to maintain the
suits. After a full hearing, the district court held that petitioner
had standing to challenge the administrator’s action, but denied
the injunctions and dismissed the bills of complaint upon the view
that the statutory provisions were. constitutional and that they
conferred upon the administrator the power which he had exer-
cised. ~
_ On appeal to the United States Court of Appeals for the Dis-
* trict’ of Columbia, that court foand it unnecessary to consider the
valiaity of the loans avd grants, and affirmed the decrees of the
district court dismissing the bills on the ground that no legal or
equitable right of the power company had been invaded, and the
eompany, therefore, was without standing to challenge the validity
of the administrator’s acts. 91 F. (2d) 303. With that view we
agree, and confine our consideration of the cases accordingly. ;

The trial court made elaborate findings, but for present purposes
the following is all that need be stated. Petitioner is a corporation
organized under the laws of Alabama, having. its principal office
and corporate domicile in that state. Respondent Ickes is the Ad-
ministrator of the Federal Emergency Administration of Public
Works, duly appointed by the President of the United States in
pursuance of law. The other respondents are subordinate officers
and agents of the same Emergency Administration, or officers con-
nected with its operations. 7

Petitioner, under its charter, has the right to manufacture,
supply and sell electrical energy throughout the State of Alabama.
Among other communities served by its system are the four muni-
cipalities here involved, from each of which it has a non-exclusive
franchise giving it the right to construct, maintain and operate
within the municipality an electricity-distribution system. Peti-
tioner is a-taxpayer of each of the municipalities, of the counties
in which they are located, and of the state, with respect to peti-
tioner’s properties and operations; and it also is a taxpayer of
the United States with respect thereto. _ |

Each of the municipalities is authorized under state law to con-
struct and operate municipal electric plants and distribution sys-
tems, and to engage in competition with petitioner. -Kach is author-
zed to issue bonds for the purpose of financing the construction of
such plants and to receive grants for that purpose; to mortgage
its plant or any part of it and to pledge all or any part of the
revenues derived from the operation of the plant as security for

L

4 Alabama Power Co. vs. Ickes et al.

the loan.* In each municipality an election was held prior to the
making of the loan agreements, at which it was determined by a
majority of the qualified voters that the manicipality should en-
gage in the electric business. The district court further. found—

‘Each of the municipalities invélved in this suit determined to
entef into the electric distribution business of its own free will.
There was no. solicitation or coercion on the part of any of the de-
fendants [respondents], their agents or subordinates. There was

and is no conspiracy between any of the defendants and any other
person, nor is there any other effort on the part of any of the de-
fendants to, nor are their actions motivated by a desire to, cause
injury or financial loss to the plaintiffs, or to regulate their rates
or electric rates generally, or to foster municipal ownership of
utilities,

‘‘The expenditures under these statutes involve no purchase of,
nor contract providing for, regulation by the United States. The
failure of any city to apply for or receive loans or grants under
those statutes will impose upon it no disadvantage or financial loss.

“‘The defendants have not reserved any right or power to in-
fluence or controlorates to be charge 1 by the Proposed municipal
power plants. ‘

‘Neither the United States nor any of ‘the defendants has re-
served any rigut or power under the existing contracts, or in any
other way, to require any of the muni¢ipalities to eliminate com-
petition or to designate the person or agency from whom the muni-
cipality must purchase its power. . .

‘*Neither the United States nor any of the intteads has any
power to control the operation al ‘the projects after construction
is completed. °

**Each of the projects herein involved is a part of a program
_ of national scope, is designed to relieve unemployment, and pro-

motes the general welfare of the United States.’’

These findings were made, after hearing, by the diatriet judge —
upon undisputed or conflicting evidence. The findings were not
questioned by the court below; and since they are not without
substantial support in the evidence, we accept them here as un-
assailable. Dawis v. Schwartz, 155 U. 8. 631, 636-637 ; ‘Adamson v.
Gilliland, 242 U. 8. 350, 353.

It, therefore, appears that each of the sities. in question —
has authority to construct and operate its proposed plant and dis-

8 Bee Oppenheim v. City of Florence, 229 Ala. 50.

Pa ee?) oe ee ee ee Lo le ee —

eee ee —

Alabama Power Co. vs. Ickes: et al. 5
tribution system in competition with petitioner, and to borrow

money, issue bonds and receive grants for that Aan nd it .

determined todo so of its own free will, without solititation or
coercion; that there was no conspiracy between any of the re-
. spondents and any other person, or any effort or action motivated
by a desire to cause injury or financial loss to petitioner, or axy
purpose to regulate rates or foster-mmunicipal ownership of utilities.
It further appears that neither the United States nor any of the
respondents has reserved any right or power to require an elimi-
nation of competition or designate any agency from which the
municipality must purchase its power. Each municipality is left
entirely free from federal control or direction in respect of the

management and control of its plant and business. In short, the -

case for petitioner comes down to: the contention that consumma-

tion of the loan-and-grant agreements should be enjoined off the —

sole and detached ground that the administrator lacks constitu-
tional and statutory authority to make them, and that the resulting
moneys, which the municipalities have clear authority to take, will
be used by the municipalities in lawful, albeit destructive, compe-
tition with petitioner .

First. Unless a different conclusion is required from the mere -

fact that petitioner will sustain financial loss by reason of the lawful
competition which will result from the use by the municipalities
of the proposed leans and grants, it is clear that petitioner has
no such iriterest and will sustain no such legal injury as enables it
to maintain the present suits. Petitioner alleges that it is a tax-
payer; but the interest of a taxpayer in the moneys of the federal
treasury furnishes no basis for an appeal to the preventive powers

of a court of equity. Massachuscits v. Mellon, 262 U. 8. 447, 486 _

et seq. The principle established by the case just cited is thet the
courts have no”power to consider in isolation and annul an act of
Congress on the ground that it is unconstitutional; but may con-
_ sider that question ‘‘only when the justification fer some direct
injury suffered or threatened, presenting a justiciable issue, is made
to rest upon such an act.””. The term ‘‘direct injury’’ is there
used in its legal sense, a8 meaning a wrong which directly results
in the violation of a legal ‘right. ‘‘An injury, legally speaking,

consists of a wrong done to a person, or, in other words, a viola-—

tion of his right. It is an ancient maxim, that a damage to one,
without an injury ‘n this sense, (damnum absque injuria,) does not

; 6 Alabama Power Co. vs. Ickes et al. .

-lay the foundation of an action; because, if the act complained of
does not violate any of his legal rights, it is obvious, that he has
no cause to complain. ... . Want of right and want of remedy
are justly said to be reciprocal: Where therefore there has been a
violation of a right, the person injured is entitled to an action.’’
Parker v. Griswold, 17 Conn. 288, 302-303. The converse is equally
true, that where, although ther. 1s damage, there is no violation
of a right no action can be maintained.
Second. The only pertinent inquiry, then, is what enforcible
legal right of petitioner do the alleged wrongful agreements invade.
or threaten? If conspiracy or fraud or malice or coercion were in-
volved a different case would be presented, but in their absence,

plainly enough, the mere consummation of the loans and grants will

not constitute an actionable wrong. Nor will the subsequent appli-

cation by the municipalities of.the moneys derived therefrom give
; ‘rise to an actionable wrong, since such application, being iawful,
‘3 . will invade no legal right of petitioner. The claim that peti-
tioner will be injured, perhaps ruined, by the competition of the
municipalities brought about by the use. of the moneys, therefore,
presents a clear case of damnum absque injuria.” Stated in other
words, these municipalities have the right under state law to en-

be we at kp

j see in the_business in competition with ‘petitioner, since it has

, been given no exclusive franchise. If its business be curtailed or
\ destroyed by the operations of the municipalities, it will be by:
awful competition from which no legal wrong results.

What petitioner anticipates, we isting is damage to some-
thing it does not possess—namely, #right to be inmune from law-
_ ful municipal competiiicn. No other claim of right is involved.

It is, in principle, as though an unauthorized loan were about to be
made to enable the borrower to purchase a piece of property in
respect of which he had a right, equally with a prospective com-
plainant, to become the buyer. While the loan might frustrate
complainant’s hopes of a profitable investment, it would not violate
any legal right; and he’would have no standing to ask the aid of a
court to stop the loan.. What difference, in real substance, is there
between the case supposed and the one in hand?

The ultimate question which, therefore, emerges is one of great
breadth. Can. anyorie who will suffer injurious consequences from
the lawful use of money about to be unlawfully loaned maintain a
suit to enjoin the loan? An affirmative answer would produce novel
and startling results. And that question suggests another: Should

abet

‘
a
:
bs
at
i
i
i

Alabama Power Co. vs. Ickes et al. . 7

the loan be consummated, may such a one sue for damages? If so,
upon what ground may he sue either the person making the loan
or the person receiving it! Considered apart, the lender owes the
sufferer no enforcible duty to refrain from making the unauthor-
ized loan; and the borrower owes him no obligation to refrain
from using the proceeds in any lawful way the borrower may
choose. If such a suit can be maintained, similar suits by in-
numerable persons are likewise admissible to determine whether
money is being loaned without lawful authority for uses which,
although hurtful to the complainants, are perfectly lawful. The
supposition opens a viste f litigation. hitherto unrevealed, -
-John Doe, let us suppose, is engaged in operating a grocery store.
Richard Roe, desiring to open a rival and competing establishment,
seeks a loan from a manufacturing concern which, under its charter,
_is without authority to make the loan. The loan, if made, will be
ultra vires. The state or a stockholder of the corporation, perhaps
a creditor in some circumstances, may, upon that ground, enjoin
the loan. But may it be enjoined at the suit of John Doe, a stranger
to the corporation, because the lawful use of the money will prove
injurious to him and this result is foreseen and expected both
- by the lender and the borrower, Richard Roe? Certainly not, un-
less we are prepared to lay down the general rule that A, who will
suffer damage from the lawful act of B, and wh~ plainly will have
no case against B, may nevertheless invoke judicial aid to restrain
a third party, acting without authority, from furnishing means
which will enable B to do what the iaw permits him to do. Such a
rule would be opposed to sound reason, as we have already tried to
show, and cannot be accepted.
. If there are -conditions under which two distinct transactions,
- neither of which, apart, constitutes a judicially remediabie wrong,
may be so related to one another as to afford a basis for judicial

the present case.

What we have now said finds ample support in the decided cases.
ma Among the decisions of this court, and directly in point, is Rad-
road Co. v. Euerman, 105 U.S. 166. In that case, the railroad com-
pany was authorized by its charter, among other things, to obtapi
and afterwards manage, use and enjoy, wharves and the appur-
tenances thereto ‘‘in connection with its railroads.’’ A Louisiana
statute conferred upon the railroad the power to obtain and there-
after to own, maintain and use, suitable wharves, etc., ‘‘connected

relief, such conditions are not to be-found in the circumstances of

nant Yo Sg meget ska Vp me 8 COHN: Le Oe Rat LE

8 Alabama Power Co. Va. Tekes ot
with ont incidental to said railroad.’ Pursuant to this authority,

. the railroad company acquired property whieh it used as a wharf

and which, although limited by the statute and its charter to use
for railroad purposes, it leased to certain persons for the mooring
of vessels and the loading and unloading of cargoes upon and from
all vessels of a kind designated. Ellerman operated certain public
wharves ynder a contract with the city of New Orleans giving him
the right to collect revenues derived therefrom. He brought suit
to enjoin the execution of the lease of the railroad wharf. This
court held that he was without legal standing to maintain the suit
—his only interest being to prevent competition with himself as a-
wharfinger, which the more extensive and challenged use by the
lessees of the railroad wharf would create, and his claim for relief
resting only upon th

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386010_0252%3A09. Public record. Not legal advice.