Chapter 4. To authorize an issue of bonds to meet expenditures for the national security and defense, and, for the purpose of assisting in the prosecution of the war, to extend credit to foreign governments, and for other purposes
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CHAP. 4.— An Act To authorize an issue of bonds to meet expenditures for the national security and defense, and, for the purpose of assisting in the prosecution of the war, to extend credit to foreign governments, and for other purposes.April 24, 1917.[[H. R. 2762](/us/bill/65/hr/1)][[Public, No. 3](/us/pl/65/3).] *Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled*, That the Secretary of the United States securities.Issue authorized to borrow money for national security, etc.Post, pp. 288, 503, 844,1309.Treasury, with the approval of the President, is hereby authorized to borrow, from time to time, on the credit of the United States for the purposes of this Act, and to meet expenditures authorized for the national security and defense and other public purposes authorized by law not exceeding in the aggregate $5,000,000,000, exclusive of the sums authorized by section four of this Act, and to issue therefor *Post*, p. 36.bonds of the United States.
The bonds herein authorized shall be in such form and subject Form, terms, etc., of bonds.to such terms and conditions of issue, conversion, redemption, maturities, payment, and rate and time of payment of interest, not exceeding Interest.three and one-half per centum per annum, as the Secretary of the Treasury may prescribe. The principal and interest thereof shall be Payable in gold.payable in United States gold coin of the present standard of value and shall be exempt, both as to principal and interest, from all Exempt from taxes, except estate or inheritance.taxation, except estate or inheritance taxes, imposed by authority of the United States, or its possessions, or by any State or local taxing No circulation privilege.Offer as popular loan.authority; but such bonds shall not bear the circulation privilege.
The bonds herein authorized shall first be offered at not less than par as a popular loan, under such regulations prescribed by the Secretary of the Treasury as will give all citizens of the United States an equal opportunity to participate therein; and any portion of the Disposal of portion unsubscribed for.bonds so offered and not subscribed for may be otherwise disposed of at not less than par by the Secretary of the Treasury ; but no commissions shall be allowed or paid on any bonds issued under authority of this Act.
Sec. 2. That for the purpose of more effectually providing for Purchase of obligations of foreign governments at war with United States enemies.the national security and defense and prosecuting the war by establishing credits in the United States for foreign governments, the Secretary of the Treasury, with the approval of the President, is hereby authorized, on behalf of the United States, to purchase, at par, from such foreign governments then engaged in war with the enemies of the United States, their obligations hereafter issued, bearing the same rate of interest and containing in their essentials the same terms and conditions as those of the United States issued under authority of this Act; to enter into such arrangements as may Credits to be established. etc.be necessary or desirable for establishing such credits and for purchasing such obligations of foreign governments and for the subsequent payment thereof before maturity, but such arrangements Provisions for higher interest rate.provide that if any of the bonds of the United States issued and used for the purchase of such foreign obligations shall thereafter be converted into other bonds of the United States bearing a higher rate of interest than three and one-half per centum per annum under the *Post*, p. 36.provisions of section five of this Act, then and in that event the obligations of such foreign governments held by the United States shall be, by such foreign governments, converted in like manner and extent into obligations bearing the same rate of interest as the bonds of the United States issued under the provisions of section five of this Act.
For the purposes of this section there is appropriated,Appropriation.*Post*, p. 504, 844. out of any money in the Treasury not otherwise appropriated, the sum of $3,000,000,000, or so much thereof as may be necessary: *Provided*, That the authority granted by this section to *Proviso*.Authority to cease at end of war with German Government.the Secretary of the Treasury to purchase bonds from foreign governments, as aforesaid, shall cease upon the termination of the war between the United States and the Imperial German Government.
Sec. 3. That the Secretary of the Treasury, under such terms andReceipts from payments and sales to redeem bonds issued hereunder. conditions as he may prescribe, is hereby authorized to receive on or before maturity payment for any obligations of such foreign 36governments purchased on behalf of the United States, and to sell at not less than the purchase price any of such obligations and to apply the proceeds thereof, and any payments made by foreign governments on account of their said obligations to the redemption or purchase at not more than par and accrued interest of any bonds Other outstanding obligations.of the United States issued under authority of this Act; and if such bonds are not available for this purpose the Secretary of the Treasury shall redeem or purchase any other outstanding interest-bearing obligations of the United States which may at such time be subject to call or which may be purchased at not more than par and accrued interest.
Sec. 4. Issue of previously authorized bonds not yet issued.Panama Canal bonds.Vol. 36, p. 117.*Post*, p. 292. That the Secretary of the Treasury, in his discretion, is hereby authorized to issue the bonds not already issued heretofore authorized by section thirty-nine of the Act approved August fifth, nineteen hundred and nine, entitled “An Act to provide revenue, equalize duties, and encourage the industries of the United States, Vol. 39, p. 215. and for other purposes”; section one hundred and twenty-four of the Act approved June third, nineteen hundred and sixteen, entitled “An Act for making further and more effectual provision for the Vol. 39, p. 732.national defense, and for Special preparedness bonds.Vol. 39, p. 1002.other purposes”; section thirteen of the Act of September seventh, nineteen hundred and sixteen, entitled“An Act to establish a United States shipping board for the purpose of encouraging, developing, and creating a naval auxiliary and a naval reserve and a merchant marine to meet the requirements of the commerce of the United States with its Territories and possessions and with foreign countries, to regulate carriers by water engaged in the foreign and interstate commerce of the United States, and for other purposes”; section four hundred of the Act approved March third, nineteen hundred and seventeen, entitled “An Act to provide increased revenue to defray the expenses of the increased appropriations for the Army and Navy and the extensions of fortifications, Naval emergency bonds.Vol. 39, p. 1201.and for other purposes”; and the public resolution approved March fourth, nineteen hundred and seventeen, entitled “Joint resolution to expedite the delivery of materials, equipment, and munitions and to secure more expeditious construction of ships,” in the manner and under the terms and conditions prescribed in section one of this Act.
Additional issue tor redemption of 3 per cent loan.That the Secretary of the Treasury is hereby authorized to borrow on the credit of the United States from time to time, in addition to the sum authorized in section one of this Act, such additional amount, not exceeding $63,945,460 as may be necessary to redeem the three per cent loan of nineteen hundred and eight to nineteen hundred and eighteen, maturing August first, nineteen hundred and eighteen, and *Ante*, p. 35.to issue therefor bonds of the United States in the manner and under the terms and conditions prescribed in section one of this Act.
Sec. 5. Conversion into bonds higher interest rate if such be issued prior to end of war. That any series of bonds issued under authority of sections one and four of this Act may, under such terms and conditions as the Secretary of the Treasury may prescribe, be convertible into bonds bearing a higher rate of interest than the rate at which the same were issued if any subsequent series of bonds shall be issued at a higher rate of interest before the termination of the war between the United Proclamation to fix date.
States and the Imperial German Government, the date of such termination to be fixed by a proclamation of the President of the United States. Sec. 6.Certificates of indebtedness.Authority to borrow money and issue, therefor.*Post*, p. 290. That in addition to the bonds authorized by sections one and four of this Act, the Secretary of the Treasury is authorized to borrow from time to time, on the credit of the United States, for the purposes of this Act and to meet public expenditures authorized by law, such sum or sums as, in his judgment, may be necessary, and to issue therefor certificates of indebtedness at not less than par in such Interest.form and subject to such terms and conditions and at such rate of37 interest, not exceeding three and one-half per centum per annum, Payable within one year.as he may prescribe; and each certificate so issued shall be payable, with the interest accrued thereon, at such time, not exceeding one year from the date of its issue, as the Secretary of the Treasury may prescribe.
Certificates of indebtedness herein authorized shall not No circulation privilege.Amount limited.*Post*, pp. 291, 504, 1311.Exempt from taxes, except estate or inheritance.bear the circulation privilege, and the sum of such certificates outstanding shall at no time exceed in the aggregate $2,000,000,000, and such certificates shall be exempt, both as to principal and interest, from all taxation, except estate or inheritance taxes, imposed by authority of the United States, or its possessions, or by any State or local taxing authority.
Sec. 7. That the Secretary of the Treasury, in his discretion, Deposit of proceeds in banks and trust companies.*Post*, pp. 291, 504.is hereby authorized to deposit in such banks and trust companies as he may designate the proceeds, or any part thereof, arising from the sale of the bonds and certificates of indebtedness authorized by this Act, or the bonds previously authorized as described in section four *Ante*, p. 36.of this Act, and such deposits may bear such rate of interest and be Interest, etc.subject to such terms and conditions as the Secretary of the Treasury may prescribe:*Provided*, That the amount so deposited shall not *Provisos*..
Limitation.in any case exceed the amount withdrawn from any such bank or trust company and invested in such bonds or certificates of indebtedness plus the amount so invested by such bank or trust company, and such deposits shall be secured in the manner required for other Security required. [R. S., sec. 5153. p. 996](/us/rs/sec5153/p996).Vol. 34, p. 1290.deposits by section fifty-one hundred and fifty-three, Revised Statutes, and amendments thereto: *Provided further*, That the provisionsReserves at depositaries.R.
S.,sec.5191, p. 1004.Vol. 38, p. 682. of section fifty-one hundred and ninety-one of the Revised Statutes, as amended by the Federal Reserve Act and the amendments thereof, with reference to the reserves required to be kept by national banking associations and other member banks of the Federal Reserve System, shall not apply to deposits of public moneys by the United States in designated depositaries. Sec. 8. That in order to pay all necessary expenses, including Appropriation for expenses.rent, connected with any operations under this Act, a sum not exceeding one-tenth of one per centum of the amount of bonds and one-tenth of one per centum of the amount of certificates of indebtedness herein authorized is hereby appropriated, or as much thereof as may be necessary, out of any money in the Treasury not otherwise appropriated, to be expended as the Secretary of the Treasury may direct: *Provided*, That, in addition to the reports now required by law, the*Proviso*.Additional statement of expenditures.
Secretary of the Treasury shall, on the first Monday in December, nineteen hundred and seventeen, and annually thereafter, transmit to the Congress a detailed statement of all expenditures under this *Post*, p. 506.Act. Approved, April 24, 1917.