Public Law 271. to revise air-mail laws, and to establish a commission to make a report to the Congress 615recommending an aviation policy”, approved June 12, 1934, as amended (48 Stat. 933, 1243), is amended to read as follows: " “Sec. 3. (a) The Postmaster General is authorized to award contractsContracts for car

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(/us/pl/74/270).] *Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled*, Air Mail Act of 1934, amendments.Vol. 48, pp. 933, 1243.*Post*, p. 1175. That subsection

(a)of section 3 of the Act entitled “An Act to revise air-mail laws, and to establish a commission to make a report to the Congress 615recommending an aviation policy”, approved June 12, 1934, as amended (48 Stat. 933, 1243), is amended to read as follows: " “Sec. 3.

(a)The Postmaster General is authorized to award contractsContracts for carrying air mail. for the transportation of air mail by airplane between such points as he may designate, and for initial periods of not exceedingInitial contract periods. three years, to the lowest responsible bidders tendering sufficient guaranty for faithful performance in accordance with the terms of the advertisement at fixed rates per airplane-mile: *Provided*, That*Provisos*.Right of low bidder to appeal if refused contract. where the Postmaster General holds that a low bidder is not responsible or qualified under this Act, such bidder shall have the right to appeal to the Comptroller General, who shall speedily determine the issue, and his decision shall be final: *Provided further* Maximum base rate of pay.That the base rate of pay which may be bid and accepted in awarding such contracts shall in no case exceed 33⅓ cents per airplane-mile for transporting a mail load not exceeding three hundred pounds. PayBasis of computation.ment for transportation shall be at the base rate fixed in the contract for the first three hundred pounds of mail or fraction thereof plus one-tenth of such base rate for each additional one hundred pounds of mail or fraction thereof, computed at the end of each calendar month on the basis of the average mail load carried per mile over the route during such month, except that in no case shall payment exceed 40 cents per airplane-mile.” " Sec. 2. Subsection

(c)of section 3 of such Act is amended to readVol. 48, p. 934. as follows: " “(c) If, in the opinion of the Postmaster General, the public interRoute extensions.est requires it, he may grant extensions of any route: *Provided*, That*Proviso*.Limitation. the aggregate mileage of all such extensions on any route in effect at one time shall not exceed two hundred and fifty miles, and that the rate of pay for such extensions shall not be in excess of the rate per mile fixed for the service thus extended.” " Sec. 3. The first sentence of subsection **(d)** of section 3 of suchClassification of routes.Vol. 48, p. 934. Act is amended to read as follows: " “The Postmaster General may designate certain routes as primaryPrimary or secondary may be designated. or as secondary routes. He shall designate as primary routes at least three transcontinental routes, with such termini as he may deem advisable, and, in addition thereto, such other routes as he may consider in the public interest, but no route less than seven hundred and fifty miles in length shall be designated as a primary route: *Provided*,*Provisos*.Coastal routes. That the present routes from Seattle to San Diego and from Newark (or New York, as the case may be) to Miami, Florida, may be held and regarded as other than primary routes: *Provided further*,Designated transcontinental routes included as primary. That the Southern Transcontinental Route from Boston via New York (or Newark, as the case may be) and Washington to Los Angeles, shall be designated as a primary route.” " Sec. 4. Subsection

(f)of section 3 of such Act is amended to readVol. 48, p. 934. as follows: " “(f) The Postmaster General shall not award contracts for air-mailMileage limitation, etc. routes or extend such routes in excess of an aggregate of thirty-two thousand miles, and shall not pay for air-mail transportation on such routes and extensions in excess of an annual aggregate of forty-five million airplane-miles. Subject to the foregoing, the PostmasterSchedules, etc. General shall prescribe the number and frequency of schedules, inter mediate regular stops, and time of departure of all planes carrying air mail, with due regard for the volume of mail carried over each route and for connecting schedules, and he may, under such regulations as he may prescribe, authorize and, notwithstanding any other provisions of this Act, compensate for a special schedule or an extraEmergency, etc., trips. or emergency trip in addition to any regular schedule over air-mail routes or portions thereof at the same mileage rate paid for regular 616schedules on the contract route or routes, or at a lesser rate if agreed to by the contractor and the Postmaster General, and he may utilize therefor any scheduled passenger or express flight of the contractor between the terminal points or over a portion of any route whenever*Proviso*.Nonmail schedule or plane. the needs of the service may so require: *Provided*, That the Postmaster General may, upon application by an air-mail contractor, authorize said contractor for his own convenience to transport air mail on any nonmail schedule or plane, with the understanding that the weights of mail so transported will be credited to regular mail schedules and no mileage compensation will be claimed therefor and the miles flown in such cases will not be computed in the annual aggregate of flown mileage authorized under this section.” " Sec. 5. Vol. 48, p. 935. Subsection

(a)of section 6 of such Act is amended to read as follows: " “Sec. 6 Interstate Commerce Commission to fix compensation rates.

(a)The Interstate Commerce Commission is hereby empowered and directed, after notice and hearing, to fix and determine by order, as soon as practicable and from time to time, the fair and reasonable rates of compensation within the limitations of this Act for the transportation of air mail by airplane and the service connected therewith over each air-mail route, and over each section thereof covered by a separate contract, prescribing the method or methods by weight or space, or both, or otherwise, for ascertaining such rates of compensation, and to publish the same, which shall continue in force until changed by the said Commission after due notice and hearing, Conflicting clauses repealed.Vol. 48, p. 934.Vol. 48, p. 936.and so much of subsection

(g)of section 3 of this Act as is in conflict with this section is hereby repealed.” " Sec. 6. Subsection

(e)of section 6 of such Act is amended by adding at the end thereof the following: " Determining fair transportation rates.Losses resulting from maintenance of non-mail schedules.“In arriving at such determination the Commission shall disregard losses resulting, in the opinion of the Commission, from the unprofitable maintenance of nonmail schedules, in cases where the Commission may find that the gross receipts from such schedules fail to meet the additional operating expense occasioned thereby. In fixing and Burden of proof when insufficiency of compensation rate alleged.determining such rates, if it shall be contended or alleged by the holder of an air-mail contract that the rate of compensation in force for the service involved is insufficient, the burden of establishing such Rate restriction.insufficiency and the extent thereof shall be assumed by him. In no case shall the rates fixed and determined by the said Commission hereunder exceed the limits prescribed in section 3

(a)of this Act. Report to Congress.“The Commission is hereby authorized and directed, after having made a full and complete examination and audit of the books, and after having examined and carefully scrutinized all expenditures and purported expenditures, of the holders of the contracts hereinafter referred to, for goods, lands, commodities, and services, in order to determine whether or not such expenditures were fair and just, and were not improper, excessive, or collusive, in the cases of the eight air-mail contracts which are allowed, by a previous report of the Commission, the rate of 33⅓ cents per mile, under the provisions of the Act of June 12, 1934, on routes Numbered 7, 12, 13, 14, 19, 25, 27, and 32, and the Commission shall make a report to the Congress, not later than January 15, 1936, whether or not, in its judgment, a fair and reasonable rate of compensation on each of said eight contracts, under the other provisions and conditions of said Act, as herein amended, is in excess of 33⅓ cents per mile; together with full facts and reasons in detail why it recommends for or against any claim for increase.” " 617 Sec. 7. Subsection

(b)of section 6 of such Act is amended to readVol. 48, p. 938. as follows: " “(b) The Interstate Commerce Commission is hereby directed atExamination of contractors’ records; purpose. least once in each calendar year from the date of the award of any contract to examine the books, accounts, contracts, and entire business records of the holder of each air-mail contract, and to review the rates of compensation being paid to such holder in order to be assured that no unreasonable profit is being derived or accruing therefrom, and in order to fix just rates. In determining what mayUnreasonable profit; factors to be considered. constitute an unreasonable profit the said Commission shall take into consideration the income derived from the operation of airplanes over the routes affected, and in addition to the requirements of section 3

(f)of this Act, shall take into consideration all forms of expenditures of said companies in order to ascertain whether or not the expenditures have been upon a fair and reasonable basis on the part of said company and whether or not the said company has paid more than a fair and reasonable market value for the purchase or rent of planes, engines, or any other types or kind, or class, or goods, or services, including spare parts of all kinds, and whether or not the air-mail contracting company has purchased or rented any kind of goods, commodities, or services from any individuals who own stock in or are connected with the said contracting companies or has purchased such goods and services from any company or corporations in which any of the individuals employed by or owning stock in the air-mail contracting company have any interest or from which such purchase or rents any of the employees or stockholders of air-mail contracting companies would be directly or indirectly benefited. Within thirty days after a decision has been reached upon suchReport to be submitted. review by the Interstate Commerce Commission touching such profit a full report thereof shall be made to the Postmaster General, to the Secretary of the United States Senate, and to the Clerk of the House of Representatives.” " Sec. 8. The first sentence of subsection

(c)of section G of suchVol. 48, p. 935. Act is amended to read as follows: " “Any contract

(1)let, extended, or assigned pursuant to the provisionsExtensions of contracts if satisfactorily performed of this Act, and in full force and effect on March 1, 1935, or

(2)which may be let subsequent to such date pursuant to the provisions of this Act and shall have been satisfactorily performed by the contractor during its full initial period, shall, from and after such date, or from and after the termination of its initial period, as the case may be, be continued in effect for an indefinite period, and compensation therefor, on and after March 1, 1935, during such period of indefinite continuance, shall be paid at the rate fixed byRates and conditions. order of the Commission under this Act, subject to such additional conditions and terms as the Commission may prescribe, upon recommendation of the Postmaster General, which shall be consistent with the requirements and limitations contained in section 1 of this Act; but any contract so continued in effect may be terminated by theTermination, upon 60 days’ notice.Notice and hearing. Commission upon sixty days’ notice, upon such hearing and notice thereof to interested parties as the Commission may determine to be reasonable; and may also be terminated, in whole or in part, by mutual agreement of the Postmaster General and the contractor, or for cause by the contractor upon sixty days’ notice.” " Sec. 9. Subsection

(d)of section 7 of such Act is amended toVol. 48, p. 936. read as follows: " “(d) No person shall be qualified to enter upon the performance of,Air mail contractors.Qualifications and salaries of officers, etc., of. or thereafter to hold an air-mail contract

(1)if, at or after the time specified for the commencement of mail transportation under such618 contract, such person is (or, if a partnership, association, or corporation, has a member, officer, or director, or an employee performing general managerial duties, that is) an individual who has theretofore entered into any unlawful combination to prevent the making of any*Provisos*.Affidavits respecting activities in regard to bidding, etc. bids for carrying the mails: *Provided*, That whenever required by the Postmaster General or Interstate Commerce Commission the bidder shall submit an affidavit executed by the bidder, or by such of its officers, directors, or general managerial employees as the Postmaster General or Interstate Commerce Commission may designate, sworn to before an officer authorized and empowered to administer oaths, stating in such affidavit that the affiant has not entered nor proposed to enter into any combination to prevent the making of any bid for carrying the mails, nor made any agreement, or given or performed, or promised to give or perform, any consideration whatever to induce Salary, etc., provision.any other person to bid or not to bid for any mail contract, or

(2)if it pays any officer, director, or regular employee compensation in any form, whether as salary, bonus, commission, or otherwise, at a rate exceeding $17,500 per year for full time: *Provided further*,Limitation on amount. That it shall be unlawful for any officer or regular employee to draw a salary of more than $17,500 per year from any air-mail contractor, or a salary from any other company if such salary from any company makes his total compensation more than $17,500 per year.” " Sec. 10. Vol. 48, p. 937. Section 10 of such Act is amended to read as follows: " “Sec. 10. Records and accounts; requirement. All persons holding air-mail contracts shall be required to keep their books, records, and accounts under such regulations as may be promulgated by the Postmaster General, and he is hereby Examination by Post Office Department.authorized, if and when he deems it advisable to do so, to examine and audit the books, records, and accounts of such contractors, and to require such contractors to submit full financial reports in such form and under such regulations as he may prescribe. By Interstate Commerce Commission.“Whenever an audit of the books, records, or accounts of any air-mail contractor is made by the auditors of the Interstate Commerce Commission, a full and complete report thereof shall be made to the Post Office Department within thirty days, and that report shall contain all instances in which the contractor has failed to comply with any of the provisions of the uniform system of accounts prescribed by the Post Office Department; and the Postmaster General shall, upon request, have at all times access to the records and reports of Auditing expenses.the Commission concerning air mail and air-mail contracts. There is authorized to be used from the appropriations for Contract Air Mail Service for the fiscal year ending June 30, 1936, a sum not in excess of $25,000 for the purpose of auditing the books and records of air-mail contractors by the Post Office Department.” " Sec. 11. Vol. 48, p. 937. Section 13 of such Act is amended to read as follows: " “Sec. 13. Compensation rates, labor conditions, etc. It shall be a condition upon the holding of any air-mail contract that the rate of compensation and the working conditions and relations for all pilots and other employees of the holder of such contract shall conform to decisions heretofore or hereafter made by the National Labor Board, or its successor in authority, notwithstanding any limitation as to the period of its effectiveness included Collective bargaining.in any such decision heretofore rendered. This section shall not be construed as restricting the right of any such employees by collective bargaining to obtain higher rates of compensation or more favorable working conditions and relations.” " Sec. 12. Vol. 48, pp. 938, 1243. Section 15, as amended, of such Act is amended to read as follows: " “Sec. 15. Number of contracts to contractor limited. After June 30, 1935, no person holding a contract or contracts for carrying air mail on a primary route shall be awarded or619 hold any contract for carrying air mail on any other primary route, nor on more than three additional routes other than primary routes. In case one person holds several contracts covering different sections of one air-mail route as designated by the Postmaster General, such several contracts shall be counted as one contract for the purpose of the preceding sentence. It shall be unlawful for air-mail contractors,Unlawful practices. competing in parallel routes, to merge or to enter into any agreement, express or implied, which may result in common control or ownership. After June 30, 1935, no air-mail contractor shall be allowed to maintain passenger or express service off the line of his air-mail route which in any way competes with passenger or express service available upon another air-mail route, except that off-line competitive service which has been regularly maintained on and prior to July 1, 1935, and such seasonal schedules as may have been regularly maintained during the year prior to July 1, 1935, may be continued if restricted to the number of schedules and to the stops scheduled and in effect during such period or season. “Upon application of the Postmaster General or of any interestedInquiries as to alleged unfair practices authorized. air-mail contractor, setting forth that the general transport business or earnings upon an air-mail route are being adversely affected by any alleged unfair practice of another air-mail contractor, or by any competitive air-transport service supplied by an air-mail contractor other than that supplied by him on the line of his prescribed air-mail route, or by any service inaugurated by him after July 1, 1935, through the scheduling of competitive nonmail flights over an air-mail route, the Interstate Commerce Commission shall, after giving reasonable notice to the air-mail contractor complained of, inquire fully into the subject matter of the allegations; and if thePowers of Commission. Commission shall find such practice or competition or any part thereof to be unfair, or that such competitive service in whole or in part is not reasonably required in the interest of public convenience and necessity, and if the Commission shall further find that in either case the receipts or expenses of an air-mail contractor are so affected thereby as to tend to increase the cost of air-mail transportation, then it shall order such practice or competitive service, or both, as the case may be, discontinued or restricted in accordance with such findings, and the respondent air-mail contractor named in the order shall comply therewith within a reasonable time to be fixed in such order. If the Commission shall find after like application, notice,Additional service ordered if necessary. and hearing that the public convenience and necessity requires additional service or schedules and such service or schedules do not tend to increase the cost of air-mail transportation, it may permit the institution and maintenance of such schedules and prescribe the frequency thereof. The compensation of any air-mail contractorWithholding pay for violation. shall be withheld during any period that it continues to violate any order of the Commission or any provision of this Act. " Sec. 13. Section 6 of such Act is hereby amended by adding at theVol. 48, p. 936. end thereof a new subsection to read as follows: " “(f) Each holder of an air-mail contract shall file with the InterRebates and passes.state Commerce Commission, in such form as the Commission shall require, on July 1st and January 1st of each year, a full statement of all free transportation hereafter furnished during the preceding semiannual period to any persons, including in each case the regular tariff value thereof, the name and address of the donee, and a statement of the reason for furnishing such free transportation.” " Approved, August 14, 1935. To provide for the general welfare by establishing a system of Federal old-age benefits, and by enabling the several States to make more adequate provision for aged persons, blind persons, dependent and crippled children, maternal and child welfare, public health, and the administration of their unemployment compensation laws; to establish a Social Security Board; to raise revenue; and for other purposes. 1935-08-14 531 Chapter 49 Stat. 620 74 1 United States Government Publishing Office text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain. Digitization Vendor 2025-01-07 public 620 [CHAPTER 531.] AN ACT To provide for the general welfare by establishing a system of Federal old-age benefits, and by enabling the several States to make more adequate provision for aged persons, blind persons, dependent and crippled children, maternal and child welfare, public health, and the administration of their unemployment compensation laws; to establish a Social Security Board; to raise revenue; and for other purposes. August 14, 1935.[[H. R. 7260](/us/bill/74/hr/7260).][[Public, No. 271](/us/pl/74/271).] *Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled*, Social Security Act. TITLE I— Title I—Grants to States for old-age assistance.GRANTS TO STATES FOR OLD-AGE ASSISTANCE Appropriation.appropriation Section 1. Amount for fiscal year 1936.*Post*, p. 1113. For the purpose of enabling each State to furnish financial assistance, as far as practicable under the conditions in such State, to aged needy individuals, there is hereby authorized to be appropriated for the fiscal year ending June 30, 1936, the sum of Subsequent fiscal years.*Post*, p. 1605.Availability to States.$49,750,000, and there is hereby authorized to be appropriated for each fiscal year thereafter a sum sufficient to carry out the purposes of this title. The sums made available under this section shall be used for making payments to States which have submitted, and had *Post*, p. 635.approved by the Social Security Board established by Title VII (hereinafter referred to as the “Board”), State plans for old-age assistance. State old-age assistance plans.state old-age assistance plans Sec. 2. Requirements.

(a)A State plan for old-age assistance must

(1)provide that it shall be in effect in all political subdivisions of the State, and, if administered by them, be mandatory upon them;

(2)provide for financial participation by the State;

(3)either provide for the establishment or designation of a single State agency to administer the plan, or provide for the establishment or designation of a single State agency to supervise the administration of the plan;

(4)provide for granting to any individual, whose claim for old-age assistance is denied, an opportunity for a fair hearing before such State agency;

(5)provide such methods of administration (other than those relating to selection, tenure of office, and compensation of personnel) as are found by the Board to be necessary for the efficient operation of the plan;

(6)provide that the State agency will make such reports, in such form and containing such information, as the Board may from time to time require, and comply with such provisions as the Board may from time to time find necessary to assure the correctness and verification of such reports; and

(7)provide that, if the State or any of its political subdivisions collects from the estate of any recipient of old-age assistance any amount with respect to old-age assistance furnished him under the plan, one-half of the net amount so collected shall be promptly paid to the United States. Any payment so made shall be deposited in the Treasury to the credit of the appropriation for the purposes of this title.

(b)Approval of plan by Board. The Board shall approve any plan which fulfills the conditions specified in subsection (a), except that it shall not approve any plan which imposes, as a condition of eligibility for old-age assistance under the plan—

(1)An age requirement of more than sixty-five years, except that the plan may impose, effective until January 1, 1940, an age requirement of as much as seventy years; or 621

(2)Any residence requirement which excludes any resident of the State who has resided therein five years during the nine years immediately preceding the application for old-age assistance and has resided therein continuously for one year immediately preceding the application; or

(3)Any citizenship requirement which excludes any citizen of the United States. payment to statesPayment to States. Sec. 3.

(a)From the sums appropriated therefor, the SecretaryAmount to be paid quarterly. of the Treasury shall pay to each State which has an approved plan for old-age assistance, for each quarter, beginning with the quarter commencing July 1, 1935,

(1)an amount, which shall be used exclusivelyMatching funds by States. as old-age assistance, equal to one-half of the total of the sums expended during such quarter as old-age assistance under the State plan with respect to each individual who at the time of such expenditure is sixty-five years of age or older and is not an inmate of a public institution, not counting so much of such expenditure with respect to any individual for any month as exceeds $30, and

(2)5Administrative costs. per centum of such amount, which shall be used for paying the costs of administering the State plan or for old-age assistance, or both, and for no other purpose: *Provided*, That the State plan, in*Proviso*.Time of financial participation. order to be approved by the Board, need not provide for financial participation before July 1, 1937 by the State, in the case of any State which the Board, upon application by the State and after reasonable notice and opportunity for hearing to the State, finds is prevented by its constitution from providing such financial participation.

(b)The method of computing and paying such amounts shall beMethod of computing and paying amounts. as follows:

(1)The Board shall, prior to the beginning of each quarter,Estimate to be submitted prior to beginning of quarter.Basis of estimates. estimate the amount to be paid to the State for such quarter under the provisions of clause

(1)of subsection (a), such estimate to be based on

(A)a report filed by the State containing its estimate of the total sum to be expended in such quarter in accordance with the provisions of such clause, and stating the amount appropriated or made available by the State and its political subdivisions for such expenditures in such quarter, and it such amount is less than one-half of the total sum of such estimated expenditures, the source or sources from which the difference is expected to be derived,

(B)records showing the number of aged individuals in the State, and

(C)such other investigation as the Board may find necessary.

(2)The Board shall then certify to the Secretary of theCertification of amount by Board; adjustments. Treasury the amount so estimated by the Board, reduced or increased, as the case may be, by any sum by which it finds that its estimate for any prior quarter was greater or less than the amount which should have been paid to the State under clause

(1)of subsection

(a)for such quarter, except to the extent that such sum has been applied to make the amount certified for any prior Quarter greater or less than the amount estimated by the Board or such prior quarter.

(3)The Secretary of the Treasury shall thereupon, through thePayments; prior audit by General Accounting Office waived. Division of Disbursement of the Treasury Department and prior to audit or settlement by the General Accounting Office, pay to the State, at the time or times fixed by the Board, the amount so certified, increased by 5 per centum. 622 Operation of State plans.operation of state plans Sec. 4. Payments withheld when State not complying with approved plan; notice and hearing. In the case of any State plan for old-age assistance which has been approved by the Board, if the Board, after reasonable notice and opportunity for hearing to the State agency administering or supervising the administration of such plan, finds—

(1)that the plan has been so changed as to impose any age, *Ante*, p. 620.residence, or citizenship requirement prohibited by section 2 (b), or that in the administration of the plan any such prohibited requirement is imposed, with the knowledge of such State agency, in a substantial number of cases; or

(2)that in the administration of the plan there is a failure to comply substantially with any provision required by section 2

(a)to be included in the plan; the Board shall notify such State agency that further payments will not be made to the State until the Board is satisfied that such prohibited requirement is no longer so imposed, and that there is no longer any such failure to comply. Until it is so satisfied it shall make no further certification to the Secretary of the Treasury with respect to such State. Administration.administration Sec. 5. Appropriation authorized for Board expenses.*Post*, p. 1118. There is hereby authorized to be appropriated for the fiscal year ending June 30, 1936, the sum of $250,000, for all necessary expenses of the Board in administering the provisions of this title. Definition.definition Sec. 6. “Old-age assistance.” When used in this title the term “old-age assistance” means money payments to aged individuals. TITLE II— Title II—Federal old-age benefits.FEDERAL OLD-AGE BENEFITS old-age reserve account Section 201. “Old-Age Reserve Account”, created.

(a)There is hereby created an account in the Treasury of the United States to be known as the “Old-Age Reserve Annual appropriation.*Post*, p. 1635.Account” hereinafter in this title called the “Account”. There is hereby authorized to be appropriated to the Account for each fiscal Determination of amount.year, beginning with the fiscal year ending June 30, 1937, an amount sufficient as an annual premium to provide for the payments required under this title, such amount to be determined on a reserve basis in accordance with accepted actuarial principles, and based upon such tables of mortality as the Secretary of the Treasury shall from time to time adopt, and upon an interest rate of 3 per centum per annum Annual estimate of appropriation.compounded annually. The Secretary of the Treasury shall submit annually to the Bureau of the Budget an estimate of the appropriations to be made to the Account.

(b)Investment of amounts credited to Account. It shall be the duty of the Secretary of the Treasury to invest such portion of the amounts credited to the Account as is not, in his judgment, required to meet current withdrawals. Such investment may be made only in interest-bearing obligations of the United States or in obligations guaranteed as to both principal and interest by Acquisition of United States obligations.the United States. For such purpose such obligations may be acquired

(1)on original issue at par, or

(2)by purchase of Second Liberty Bond Act.Vol. 40, p. 503; *Ante*, p. 20; *Post*, p. 699; [U. S. C., p. 1419](/us/usc/p1419).Special obligations; interest rate.outstanding obligations at the market price. The purposes for which obligations of the United States may be issued under the Second Liberty Bond Act, as amended, are hereby extended to authorize the issuance at par of special obligations exclusively to the Account. Such special obligations shall bear interest at the rate of 3 per centum per 623annum. Obligations other than such special obligations may beOther obligations; acquisition of. acquired for the Account only on such terms as to provide an investment yield of not less than 3 per centum per annum.

(c)Any obligations acquired by the Account (except specialSale of. obligations issued exclusively to the Account) may be sold at the market price, and such special obligations may be redeemed at par plus accrued interest.

(d)The interest on, and the proceeds from the sale or redemptionInterest and proceeds of sale credited to Account. of, any obligations held in the Account shall be credited to and form a part of the Account.

(e)All amounts credited to the Account shall be available forAvailability. mailing payments required under this title.

(f)The Secretary of the Treasury shall include in his annualAnnual report of actuarial status. report the actuarial status of the Account. old-age benefit paymentsOld-age benefit payments. Sec. 202.

(a)Every qualified individual (as defined in sectionPersons entitled to receive.*Post*, p. 625. 210) shall be entitled to receive, with respect to the period beginning on the date he attains the age of sixty-five, or on January 1, 1942, whichever is the later, and ending on the date of his death, an old-age benefit (payable as nearly as practicable in equal monthly installments) as follows:

(1)If the total wages (as defined in section 210) determinedAmounts to be paid.*Post*, p. 625. by the Board to have been paid to him, with respect to employment (as defined in section 210) after December 31, 1936, and before he attained the age of sixty-five, were not more than $3,000, the old-age benefit shall be at a monthly rate of one-half of 1 per centum of such total wages;

(2)If such total wages were more than $3,000, the old-age benefit shall be at a monthly rate equal to the sum of the following:

(A)One-half of 1 per centum of $3,000; plus

(B)One-twelfth of 1 per centum of the amount by which such total wages exceeded $3,000 and did not exceed $45,000; plus

(C)One-twenty-fourth of 1 per centum of the amount by which such total wages exceeded $45,000.

(b)In no case shall the monthly rate computed under subsectionRestriction on total monthly rate.

(a)exceed $85.

(c)If the Board finds at any time that more or less than theAdjustments. correct amount has theretofore been paid to any individual under this section, then, under regulations made by the Board, proper adjustments shall be made in connection with subsequent payments under this section to the same individual.

(d)Whenever the Board finds that any qualified individual hasReductions. received wages with respect to regular employment after he attained the age of sixty-five, the old-age benefit payable to such individual shall be reduced, for each calendar month in any part of which such regular employment occurred, by an amount equal to one month’s benefit. Such reduction shall be made, under regulations prescribed by the Board, by deductions from one or more payments of old-age benefit to such individual. payments upon deathPayments upon death. Sec. 203.

(a)If any individual dies before attaining the age ofWhen individual dies before receiving any benefit payment. sixty-five, there shall be paid to his estate an amount equal to 3½ per centum of the total wages determined by the Board to have been paid to him, with respect to employment after December 31, 1936. 624

(b)When recipient dies before receiving total payable benefits. If the Board finds that the correct amount of the old-age benefit payable to a qualified individual during his life under section 202 was less than 3½ per centum of the total wages by which such old-age benefit was measurable, then there shall be paid to his estate a sum equal to the amount, if any, by which such 3½ per centum exceeds the amount (whether more or less than the correct amount) paid to him during his life as old-age benefit.

(c)Adjustments when underpaid recipient dies. If the Board finds that the total amount paid to a qualified individual under an old-age benefit during his life was less than the correct amount to which he was entitled under section 202, and that the correct amount of such old-age benefit was 3½ per centum or more of the total wages by which such old-age benefit was measurable, then there shall be paid to his estate a sum equal to the amount, if any, by which the correct amount of the old-age benefit exceeds the amount which was so paid to him during his life. Payments to aged individuals not qualified for benefits.Amount.payments to aged individuals not qualified for benefits Sec. 204.

(a)There shall be paid in a lump sum to any individual who, upon attaining the age of sixty-five, is not a qualified individual, an amount equal to 3½ per centum of the total wages determined by the Board to have been paid to him, with respect to employment after December 31, 1936, and before he attained the age of sixty-five.

(b)Restriction on other payments. After any individual becomes entitled to any payment under subsection (a), no other payment shall be made under this title in any manner measured by wages paid to him, except that any part of any payment under subsection

(a)which is not paid to him before his death shall be paid to his estate. Amounts of $500 or less payable to estates.amounts of $500 or less payable to estates. Sec 205. Regulations. If any amount payable to an estate under section 203 or 204 is $500 or less, such amount may, under regulations prescribed by the Board, be paid to the persons found by the Board to be entitled thereto under the law of the State in which the deceased was domiciled, without the necessity of compliance with the requirements of law with respect to the administration of such estate. Overpayments during life.overpayments during life Sec. 206. Repayment from estate of recipient. If the Board finds that the total amount paid to a qualified individual under an old-age benefit during his life was more than the correct amount to which he was entitled under section 202, and was 3½ per centum or more of the total wages by which such old-age benefit was measurable, then upon his death there shall be repaid to the United States by his estate the amount, if any, by which such total amount paid to him during his life exceeds whichever of the following is the greater:

(1)Such 3½ per centum, or

(2)the correct amount to which he was entitled under section 202. Method of making payments.method of making payments Sec. 207. Payment on certification of Board. The Board shall from time to time certify to the Secretary of the Treasury the name and address of each person entitled to receive a payment under this title, the amount of such payment, and the time at which it should be made, and the Secretary of the Treasury through the Division of Disbursement of the Treasury Department, and prior to audit or settlement by the General Account-625ing Office, shall make payment in accordance with the certification by the Board. assignmentAssignment. Sec. 208. The right of any person to any future payment underRight to receive payment not assignable; exemption from legal process. this title shall not be transferable or assignable, at law or in equity, and none of the moneys paid or payable or rights existing under this title shall be subject to execution, levy, attachment, garnishment, or other legal process, or to the operation of any bankruptcy or insolvency law. penaltiesPenalties. Sec. 209. Whoever in any application for any payment under thisFalse statements. title makes any false statement as to any material fact, knowing such statement to be false, shall be fined not more than $1,000 or imprisoned for not more than one year, or both. definitionsDefinitions. Sec. 210. When used in this title—

(a)The term “wages” means all remuneration for employment,“Wages.” including the cash value of all remuneration paid in any medium other than cash; except that such term shall not include that part of the remuneration which, after remuneration equal to $3,000 has been paid to an individual by an employer with respect to employment during any calendar year, is paid to such individual by such employer with respect to employment during such calendar year.

(b)The term “employment” means any service, of whatever“Employment.” nature, performed within the United States by an employee for his employer, except—

(1)Agricultural labor;

(2)Domestic service in a private home;

(3)Casual labor not in the course of the employer’s trade or business;

(4)Service performed as an officer or member of the crew of a vessel documented under the laws of the United States or of any foreign country;

(5)Service performed in the employ of the United States Government or of an instrumentality of the United States;

(6)Service performed in the employ of a State, a political sub-division thereof, or an instrumentality of one or more States or political subdivisions;

(7)Service performed in the employ of a corporation, community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual.

(c)The term “qualified individual” means any individual with“Qualified individual.” respect to whom it appears to the satisfaction of the Board that—

(1)He is at least sixty-five years of age; and

(2)The total amount of wages paid to him, with respect to employment after December 31, 1936. and before he attained the age of sixty-five, was not less than $2,000; and

(3)Wages were paid to him, with respect to employment on some five days after December 31, 1936, and before he attained the age of sixty-five, each day being in a different calendar year. 626 TITLE III—Title III—Grants to States for unemployment compensation administration. GRANTS TO STATES FOR UNEMPLOYMENT COMPENSATION ADMINISTRATION Appropriation.appropriation Section 301. Administration expenses.*Post*, pp. 1113, 1605. For the purpose of assisting the States in the administration of their unemployment compensation laws, there is hereby authorized to be appropriated, for the fiscal year ending June 30, 1936, the sum of $4,000,000, and for each fiscal year thereafter the sum of $49,000,000, to be used as hereinafter provided. Payments to States.payments to states Sec. 302. Certification of amount determined by Board.

(a)The Board shall from time to time certify to the Secretary of the Treasury for payment to each State which has an unemployment compensation law approved by the Board under Title IX, such amounts as the Board determines to be necessary for the proper administration of such law during the fiscal year in which Basis of Board’s determination.such payment is to be made. The Board’s determination shall be based on

(1)the population of the State;

(2)an estimate of the number of persons covered by the State law and of the cost of proper administration of such law; and

(3)such other factors as the Board Restriction on total amount.finds relevant. The Board shall not certify for payment under this section in any fiscal year a total amount in excess of the amount appropriated therefor for such fiscal year.

(b)Payment of certified amount; prior audit waived. Out of the sums appropriated therefor, the Secretary of the Treasury shall, upon receiving a certification under subsection (a), pay, through the Division of Disbursement of the Treasury Department and prior to audit or settlement by the General Accounting Office, to the State agency charged with the administration of such law the amount so certified. Provisions of State laws.provisions of state laws Sec. 303. Requirements to be incorporated.

(a)The Board shall make no certification for payment to any State unless it finds that the law of such State, approved by the Board under Title IX, includes provisions for—

(1)Approved methods of administration. Such methods of administration (other than those relating to selection, tenure of office, and compensation of personnel) as are found by the Board to be reasonably calculated to insure full payment of unemployment compensation when due; and

(2)Payment of compensation through public employment offices. Payment of unemployment compensation solely through public employment offices in the State or such other agencies as the Board may approve; and

(3)Hearing when compensation claim denied. Opportunity for a fair hearing, before an impartial tribunal, for all individuals whose claims for unemployment compensation are denied; and

(4)Payment to credit of Unemployment Trust Fund. The payment of all money received in the unemployment fund of such State, immediately upon such receipt, to the Secretary of the Treasury to the credit of the Unemployment Trust Fund established by section 904; and

(5)Expenditure of requisitioned money for unemployment compensation payments. Expenditure of all money requisitioned by the State agency from the Unemployment Trust Fund, in the payment of unemployment compensation, exclusive of expenses of administration; and

(6)Reports to Board. The making of such reports, in such form and containing such information, as the Board may from time to time require, and compliance with such provisions as the Board may from time to time find necessary to assure the correctness and verification of such reports; and 627

(7)Making available upon request to any agency of the UnitedInformation respecting recipients. States charged with the administration of public works or assistance through public employment, the name, address, ordinary occupation and employment status of each recipient of unemployment compensation, and a statement of such recipient’s rights to further compensation under such law.

(b)Whenever the Board, after reasonable notice and opportunityNotification to State agency of suspension of payments; when. for hearing to the State agency charged with the administration of the State law, finds that in the administration of the law there is—

(1)a denial, in a substantial number of cases, of unemployment compensation to individuals entitled thereto under such law; or

(2)a failure to comply substantially with any provision specified in subsection (a); the Board shall notify such State agency that further payments will not be made to the State until the Board is satisfied that there is no longer any such denial or failure to comply. Until it is so satisfied it shall make no further certification to the Secretary of the Treasury with respect to such State. TITLE IV— GRANTS TO STATES FOR AID TO DEPENDENTTitle IV—Grants to States for aid to dependent children. CHILDREN appropriationAppropriation. Section 401. For the purpose of enabling each State to furnishAmount authorized.*Post*, pp. 1113, 1605. financial assistance, as far as practicable under the conditions in such State, to needy dependent children, there is hereby authorized to be appropriated for the fiscal year ending June 30, 1936, the sum of $24,750,000, and there is hereby authorized to be appropriated for each fiscal year thereafter a sum sufficient to carry out the purposes of this title. The sums made available under this section shall beAvailability. used for making payments to States which have submitted, and had approved by the Board, State plans for aid to dependent children. state plans for aid to dependent childrenState plans for aid to dependent children. Sec. 402.

(a)A State plan for aid to dependent children must (1)Requirements. provide that it shall be in effect in all political subdivisions of the State, and, if administered by them, be mandatory upon them;

(2)provide for financial participation by the State;

(4)provide for granting to any individual, whose, claim with respect to aid to a dependent child is denied, an opportunity for a fair hearing before such State agency;

(b)The Board shall approve any plan which fulfills the conditionsApproval of plan by Board. specified in subsection (a), except that it shall not approve any plan which imposes as a condition of eligibility for aid to dependent children, a residence requirement which denies aid with respect to any child residing in the State

(1)who has resided in the State for one year immediately preceding the application628 for such aid, or

(2)who was born within the State within one year immediately preceding the application, if its mother has resided in the State for one year immediately preceding the birth. Payment to States.payment to states Sec 403. Amount to be paid quarterly.

(a)From the sums appropriated therefor, the Secretary of the Treasury shall pay to each State which has an approved plan for aid to dependent children, for each quarter, beginning with the quarter commencing July 1, 1935, an amount, which shall be used To be one-third of amount expended under State plan.exclusively for carrying out the State plan, equal to one-third of the total of the sums expended during such quarter under such plan, not counting so much of such expenditure with respect to any When more than one dependent child.dependent child for any month as exceeds $18, or if there is more than one dependent child in the same home, as exceeds $18 for any month with respect to one such dependent child and $12 for such month with respect to each of the other dependent children.

(b)Method of computing and paying amounts.Estimates to be submitted prior to beginning of quarter. The method of computing and paying such amounts shall be as follows:

(1)The Board shall, prior to the beginning of each quarter, estimate the amount to be paid to the State for such quarter under the provisions of subsection (a), such estimate to be Basis of estimates.based on

(A)a report filed by the State containing its estimate of the total sum to be expended in such quarter in accordance with the provisions of such subsection and stating the amount appropriated or made available by the State and its political subdivisions for such expenditures in such quarter, and if such amount is less than two-thirds of the total sum of such estimated expenditures, the source or sources from which the difference is expected to be derived,

(B)records showing the number of dependent children in the State, and

(C)such other investigation as the Board may find necessary.

(2)Certification of amount by Board; adjustments. The Board shall then certify to the Secretary of the Treasury the amount so estimated by the Board, reduced or increased, as the case may be, by any sum by which it finds that its estimate for any prior quarter was greater or less than the amount which should have been paid to the State for such quarter, except to the extent that such sum has been applied to make the amount certified for any prior quarter greater or less than the amount estimated by the Board for such prior quarter.

(1)that the plan has been so changed as to impose any residence requirement prohibited by section 402 (b), or that in the administration of the plan any such prohibited requirement is imposed, with the knowledge of such State agency, in a substantial number of cases; or

(2)that in the administration of the plan there is a failure to comply substantially with any provision required by section 402

(a)to be included in the plan; 629 the Board shall notify such State agency that further payments will not be made to the State until the Board is satisfied that such prohibited requirement is no longer so imposed, and that there is no longer any such failure to comply. Until it is so satisfied it shall make no further certification to the Secretary of the Treasury with respect to such State. administrationAdministration. Sec. 405. There is hereby authorized to be appropriated for theAppropriation authorized for Board expenses. fiscal year ending June 30, 1936, the sum of $250,000 for all necessary expenses of the Board in administering the provisions of this title. definitionsDefinitions. Sec. 406. When used in this title—

(a)The term “dependent child” means a child under the age of “Dependent child.”sixteen who has been deprived of parental support or care by reason of the death, continued absence from the home, or physical or mental incapacity of a parent, and who is living with his father, mother, grandfather, grandmother, brother, sister, stepfather, stepmother, stepbrother, stepsister, uncle, or aunt, in a place of residence maintained by one or more of such relatives as his or their own home;

(b)The term “aid to dependent children” means money payments“Aid to dependent children.” with respect to a dependent child or dependent children. TITLE V— GRANTS TO STATES FOR MATERNAL AND CHILD WELFARETitle V—Grants to States for maternal and child welfare. Part 1— Maternal and Child Health ServicesPart 1—Maternal and child health services. appropriationAppropriation. Section 501. For the purpose of enabling each State to extend andAmount authorized.*Post*, pp. 1121, 1350. improve, as far as practicable under the conditions in such State, services for promoting the health of mothers and children, especially in rural areas and in areas suffering from severe economic distress, there is hereby authorized to be appropriated for each fiscal year, beginning with the fiscal year ending June 30, 1936, the sum of $3,800,000. The sums made available under this section shall be usedAvailability to States. for making payments to States which have submitted, and had approved by the Chief of the Children’s Bureau, State plans for such services. allotments to statesAllotments to States. Sec. 502.

(a)Out of the sums appropriated pursuant to sectionAmount to each State; division of balance.*Post*, p. 1121. 501 for each fiscal year the Secretary of Labor shall allot to each State $20,000, and such part of $1,800,000 as he finds that the number of live births in such State bore to the total number of live births in the United States, in the latest calendar year for which the Bureau of the Census has available statistics.

(b)Out of the sums appropriated pursuant to section 501 for eachAdditional to assist in carrying out State plan. fiscal year the Secretary of Labor shall allot to the States $980,000 (in addition to the allotments made under subsection (a)), according to the financial need of each State for assistance in carrying out its State plan, as determined by him after taking into consideration the number of live births in such State.

(c)The amount of any allotment to a State under subsection (a)Amount of allotment remaining unpaid. for any fiscal year remaining unpaid to such State at the end of such fiscal year shall be available for payment to such State under section 504 until the end of the second succeeding fiscal year. No payment 630to a State under section 504 shall be made out of its allotment for any fiscal year until its allotment for the preceding fiscal year has been exhausted or has ceased to be available. Approval of State plans.approval of state plans Sec. 503. Requirements.

(a)A State plan for maternal and child-health services must

(1)provide for financial participation by the State;

(2)provide for the administration of the plan by the State health agency or the supervision of the administration of the plan by the State health agency;

(3)provide such methods of administration (other than those relating to selection, tenure of office, and compensation of personnel) as are necessary for the efficient operation of the plan;

(4)provide that the State health agency will make such reports, in such form and containing such information, as the Secretary of Labor may from time to time require, and comply with such provisions as he may from time to time find necessary to assure the correctness and verification of such reports;

(5)provide for the extension and improvement of local maternal and child-health services administered by local child-health units;

(6)provide for cooperation with medical, nursing, and welfare groups and organizations; and

(7)provide for the development of demonstration services in needy areas and among groups in special need.

(b)Approval by Chief of Children’s Bureau; notification. The Chief of the Children’s Bureau shall approve any plan which fulfills the conditions specified in subsection

(a)and shall thereupon notify the Secretary of Labor and the State health agency of his approval. Payment to States.payment to states Sec. 504. Amount to be paid quarterly.*Post*, p. 1121.

(a)From the sums appropriated therefor and the allotments available under section 502 (a), the Secretary of the Treasury shall pay to each State which has an approved plan for maternal and child-health services, for each quarter, beginning with the quarter commencing July 1, 1935, an amount, which shall be used To be one-half of amount expended under State plan.Method of computing and paying amounts.Estimates to be submitted prior to beginning of quarter.exclusively for carrying out the State plan, equal to one-half of the total sum expended during such quarter for carrying out such plan.

(b)The method of computing and paying such amounts shall be as follows:

(1)The Secretary of Labor shall, prior to the beginning of each quarter, estimate the amount to be paid to the State for such quarter under the provisions of subsection (a), such estimate to Basis of estimates.be based on

(A)a report filed by the State containing its estimate of the total sum to be expended in such quarter in accordance with the provisions of such subsection and stating the amount appropriated or made available by the State and its political subdivisions for such expenditures in such quarter, and if such amount is less than one-half of the total sum of such estimated expenditures, the source or sources from which the difference is expected to be derived, and

(B)such investigation as he may find necessary.

(2)Certification of amount by Secretary of Labor; adjustments. The Secretary of Labor shall then certify the amount so estimated by him to the Secretary of the Treasury, reduced or increased, as the case may be, by any sum by which the Secretary of Labor finds that his estimate for any prior quarter was greater or less than the amount which should have been paid to the State for such quarter, except to the extent that such sum has been applied to make the amount certified for any prior quarter greater or less than the amount estimated by the Secretary of Labor for such prior quarter. 631

(3)The Secretary of the Treasury shall thereupon, through the Division of Disbursement of the Treasury Department and prior to audit or settlement by the General Accounting Office, pay to the State, at the time or times fixed by the Secretary of Labor, the amount so certified.

(c)The Secretary of Labor shall from time to time certify to thePayments; prior audit waived. Secretary of the Treasury the amounts to be paid to the States from the allotments available under section 502 (b), and the Secretary of the Treasury shall, through the Division of Disbursement of the Treasury Department and prior to audit or settlement by the General Accounting Office, make payments of such amounts from such allotments at the time or times specified by the Secretary of Labor. operation of state plansOperation of State plans. Sec. 505. In the case of any State plan for maternal and child-healthPayments withheld when State not complying with approved plan; notice and hearing. services which has been approved by the Chief of the Children’s Bureau, if the Secretary of Labor, after reasonable notice and opportunity for hearing to the State agency administering or supervising the administration of such plan, finds that in the administration of the plan there is a failure to comply substantially with any provision required by section 503 to be included in the plan, he shall notify such State agency that further payments will not be made to the State until he is satisfied that there is no longer any such failure to comply. Until he is so satisfied he shall make no further certification to the Secretary of the Treasury with respect to such State. Part 2— Services for Crippled ChildrenPart 2—Services for crippled children. appropriationAppropriation. Sec. 511. For the purpose of enabling each State to extend andAmount authorized.*Post*, pp. 1121, 1350. improve (especially in rural areas and in areas suffering from severe economic distress), as far as practicable under the conditions in such State, services for locating crippled children, and for providing medical, surgical, corrective, and other services and care, and facilities for diagnosis, hospitalization, and aftercare, for children who are crippled or who are suffering from conditions which lead to crippling, there is hereby authorized to be appropriated for each fiscal year, beginning with the fiscal year ending June 30, 1936, the sum of $2,850,000. The sums made available under this section shall beAvailability to States. used for making payments to States which have submitted, and had approved by the Chief of the Children’s Bureau, State plans for such services. allotments to statesAllotments to States. Sec. 512.

(a)Out of the sums appropriated pursuant to sectionAmount to each State; division of balance.*Post*, p. 1121. 511 for each fiscal year the Secretary of Labor shall allot to each State $20,000, and the remainder to the States according to the need of each State as determined by him after taking into consideration the number of crippled children in such State in need of the services referred to in section 511 and the cost of furnishing such services to them.

(b)The amount of any allotment to a State under subsection (a)Amount of allotment remaining unpaid. for any fiscal year remaining unpaid to such State at the end of such fiscal year shall be available for payment to such State under section 514 until the end of the second succeeding fiscal year. No payment to a State under section 514 shall be made out of its allotment for any fiscal year until its allotment for the preceding fiscal year has been exhausted or has ceased to be available. 632 Approval of State plans.approval of state plans Sec. 513. Requirements.

(a)A State plan for services for crippled children must

(1)provide for financial participation by the State;

(2)provide for the administration of the plan by a State agency or the supervision of the administration of the plan by a State agency;

(3)provide such methods of administration (other than those relating to selection, tenure of office, and compensation of personnel) as are necessary for the efficient operation of the plan;

(4)provide that the State agency will make such reports, in such form and containing such information, as the Secretary of Labor may from time to time require, and comply with such provisions as he may from time to time find necessary to assure the correctness and verification of such reports;

(5)provide for carrying out the purposes specified insection 511; and

(6)provide for cooperation with medical, health, nursing, and welfare groups and organizations and with any agency in such State charged with administering State laws providing for vocational rehabilitation of physically handicapped children.

(b)Approval by Chief of Children’s Bureau; notification. The Chief of the Children’s Bureau shall approve any plan which fulfills the conditions specified in subsection

(a)and shall thereupon notify the Secretary of Labor and the State agency of his approval. Payment to States.payment to states Sec. 514. Amount to be paid quarterly.

(a)From the sums appropriated therefor and the allotments available under section 512, the Secretary of the Treasury shall pay to each State which has an approved plan for services for crippled children, for each quarter, beginning with the quarter commencing July 1, 1935, an amount, which shall be used exclusively for To be one-half of amount expended under State plan.Method of computing and paying amounts.carrying out the State plan, equal to one-half of the total sum expended during such quarter for carrying out such plan.

(b)The method of computing and paying such amounts shall be as follows:

(1)Estimates to be submitted prior to beginning of quarter. The Secretary of Labor shall, prior to the beginning of each quarter, estimate the amount to be paid to the State for such quarter under the provisions of subsection (a), such estimate to be Basis of estimates.based on

(A)a report filed by the State containing its estimate of the total sum to be expended in such quarter in accordance with the provisions of such subsection and stating the amount appropriated or made available by the State and its political subdivisions for such expenditures in such quarter, and if such amount is less than one-half of the total sum of such estimated expenditures, the source or sources from which the difference is expected to be derived, and

(B)such investigation as he may find necessary.

(3)Payments; prior audit waived. The Secretary of the Treasury shall thereupon, through the Division of Disbursement of the Treasury Department and prior to audit or settlement by the General Accounting Office, pay to the State, at the time or times fixed by the Secretary of Labor, the amount so certified. 633 operation of state plansOperation of State plans. Sec. 515. In the case of any State plan for services for crippledPayments withheld when State not complying with approved plan; notice and hearing. children which has been approved by the Chief of the Children’s Bureau, if the Secretary of Labor, after reasonable notice and opportunity for hearing to the State agency administering or supervising the administration of such plan, finds that in the administration of the plan there is a failure to comply substantially with any provision required by section 513 to be included in the plan, he shall notify such State agency that further payments will not be made to the State until he is satisfied that there is no longer any such failure to comply. Until he is so satisfied he shall make no further certification to the Secretary of the Treasury with respect to such State. Part 3— Child-Welfare ServicesPart 3—Child-welfare services. Sec. 521.

(a)For the purpose of enabling the United States,Appropriation authorized.*Post*, pp. 1121, 1350. through the Children’s Bureau, to cooperate with State public-welfare agencies in establishing, extending, and strengthening, especially in predominantly rural areas, public-welfare services (hereinafter in this section referred to as “child-welfare services”) for the protection and care of homeless, dependent, and neglected children, and children in danger of becoming delinquent, there is hereby authorized to be appropriated for each fiscal year, beginning with the fiscal year ending June 30, 1936, the sum of $1,500,000. Such amount shall be allottedAmount.Allotments to States. by the Secretary of Labor for use by cooperating State public-welfare agencies on the basis of plans developed jointly by the State agency and the Children’s Bureau, to each State, $10,000, and the remainderAmount to each State; division of remainder. to each State on the basis of such plans, not to exceed such part of the remainder as the rural population of such State bears to the total rural population of the United States. The amount so allotted shallExpenditure. be expended for payment of part of the cost of district, county or other local child-welfare services in areas predominantly rural, and for developing State services for the encouragement and assistance of adequate methods of community child-welfare organization in areas predominantly rural and other areas of special need. TheAmount of allotment remaining unpaid. amount of any allotment to a State under this section for any fiscal year remaining unpaid to such State at the end of such fiscal year shall be available for payment to such State under this section until the end of the second succeeding fiscal year. No payment to a State under this section shall be made out of its allotment for any fiscal year until its allotment for the preceding fiscal year has been exhausted or has ceased to be available.

(b)From the sums appropriated therefor and the allotmentsCertification of amounts to be paid. available under subsection

(a)the Secretary of Labor shall from time to time certify to the Secretary of the Treasury the amounts to be paid to the States, and the Secretary of the Treasury shall, throughPrior audit waived. the Division of Disbursement of the Treasury Department and prior to audit or settlement by the General Accounting Office, make payments of such amounts from such allotments at the time or times specified by the Secretary of Labor. Part 4— Vocational RehabilitationPart 4—Vocational rehabilitation. Sec 531.

(a)In order to enable the United States to cooperateAppropriation authorized.*Post*, pp. 1119, 1798. with the States and Hawaii in extending and strengthening their programs of vocational rehabilitation of the physically disabled, and to continue to carry out the provisions and purposes of the Act entitled “An Act to provide for the promotion of vocational rehabilitation of persons disabled in industry or otherwise and their return 634to civil employment”, approved June 2, 1920, as amended (U. S. C., title 29, ch. 4; U. S. C., Supp. VII, title 29, secs. 31, 32, 34, 35, 37, 39, and 40), there is hereby authorized to be appropriated for the fiscal years ending June 30, 1936, and June 30, 1937, the sum of $841,000 for each such fiscal year in addition to the amount of the existing authorization, and for each fiscal year thereafter the sum of Apportionment to Hawaii.$1,938,000. Of the sums appropriated pursuant to such authorization for each fiscal year, $5,000 shall be apportioned to the Territory of Hawaii and the remainder shall be apportioned among the several States in the manner provided in such Act of June 2, 1920, as amended.

(b)Appropriation authorized for administration.*Post*, pp. 1119, 1798. For the administration of such Act of June 2, 1920, as amended, by the Federal agency authorized to administer it, there is hereby authorized to be appropriated for the fiscal years ending June 30, 1936, and June 30, 1937, the sum of $22,000 for each such fiscal year in addition to the amount of the existing authorization. and for each fiscal year thereafter the sum of $102,000. Part 5— AdministrationPart 5—Administration. Sec. 541. Appropriation authorized.*Post*, pp. 1122, 1349.

(a)There is hereby authorized to be appropriated for the fiscal year ending June 30, 1936, the sum of $425,000, for all necessary expenses of the Children’s Bureau in administering the provisions of this title, except section 531.

(b)Studies and investigations by Children’s Bureau. The Children’s Bureau shall make such studies and investigations as will promote the efficient administration of this title, except section 531.

(c)Annual report. The Secretary of Labor shall include in his annual report to Congress a full account of the administration of this title, except section 531. TITLE VI— Title VI—Public Health Work.PUBLIC HEALTH WORK Appropriation.appropriation Section 601. Sum authorized.*Post*, pp. 1126, 1841. For the purpose of assisting States, counties, health districts, and other political subdivisions of the States in establishing and maintaining adequate public-health services, including the training of personnel for State and local health work, there is hereby authorized to be appropriated for each fiscal year, beginning with the fiscal year ending June 30, 1936, the sum of $8,000,000 to be used as hereinafter provided. State and local public health services.state and local public health services Sec. 602. Allotments to States by Surgeon General.

(a)The Surgeon General of the Public Health Service, with the approval of the Secretary of the Treasury, shall, at the Amounts.beginning of each fiscal year, allot to the States the total of

(1)the amount appropriated for such year pursuant to section 601; and

(2)the amounts of the allotments under this section for the preceding fiscal year remaining unpaid to the States at the end of such Determination of.fiscal year. The amounts of such allotments shall be determined on the basis of

(1)the population;

(2)the special health problems; Certification to Secretary of the Treasury.and

(3)the financial needs; of the respective States. Upon making such allotments the Surgeon General of the Public Health Service shall certify the amounts thereof to the Secretary of the Treasury.

(b)Availability of allotment remaining unpaid. The amount of an allotment to any State under subsection

(a)for any fiscal year, remaining unpaid at the end of such fiscal year, shall be available for allotment to States under subsection

(a)for the succeeding fiscal year, in addition to the amount appropriated for such year. 635

(c)Prior to the beginning of each quarter of the fiscal year, theDetermination of quarterly amounts. Surgeon General of the Public Health Service shall, with the approval of the Secretary of the Treasury, determine in accordance with rules and regulations previously prescribed by such Surgeon General after consultation with a conference of the State and Territorial health authorities, the amount to be paid to each State for such quarter from the allotment to such State, and shall certifyCertification thereof. the amount so determined to the Secretary of the Treasury. UponPayments; prior audit waived. receipt of such certification, the Secretary of the Treasury shall, through the Division of Disbursement of the Treasury Department and prior to audit or settlement by the General Accounting Office, pay in accordance with such certification.

(d)The moneys so paid to any State shall be expended solely inExpenditure. carrying out the purposes specified in section 601, and in accordance with plans presented by the health authority of such State and approved by the Surgeon General of the Public Health Service. investigationsInvestigations. Sec. 603.

(a)There is hereby authorized to be appropriated forSum authorized for disease and sanitation investigations.*Post*, pp. 1126, 1841. each fiscal year, beginning with the fiscal year ending June 30, 1936, the sum of $2,000,000 for expenditure by the Public Health Service for investigation of disease and problems of sanitation (including the printing and binding of the findings of such investigations), and for the pay and allowances and traveling expenses of personnel of the Public Health Service, including commissioned officers, engaged in such investigations or detailed to cooperate with the health authorities of any State in carrying out the purposes specified in section 601: *Provided*, That no personnel of the Public Health Service*Proviso*.Detail of Public Health Service personnel. shall be detailed to cooperate with the health authorities of any State except at the request of the proper authorities of such State.

(b)The personnel of the Public Health Service paid from anyReimbursement for salaries and allowances. appropriation not made pursuant to subsection

(a)may be detailed to assist in carrying out the purposes of this title. The appropriation from which they are paid shall be reimbursed from the appropriation made pursuant to subsection

(a)to the extent of their salaries and allowances for services performed while so detailed.

(c)The Secretary of the Treasury shall include in his annualAnnual report. report to Congress a full account of the administration of this title. TITLE VII— SOCIAL SECURITY BOARDTitle VII—Social Security Board. establishmentEstablishment. Section 701. There is hereby established a Social Security BoardComposition.*Post*, pp. 1114, 1604. (in this Act referred to as the “Board”) to be composed of three members to be appointed by the President, by and with the advice and consent of the Senate. During his term of membership on theRestriction on other employment. Board, no member shall engage in any other business, vocation, or employment. Not more than two of the members of the Board Political affiliation.shall be members of the same political party. Each member shallSalary; terms of office. receive a salary at the rate of $10,000 a year and shall hold office for a term of six years, except that

(1)any member appointed to fillVacancies. a vacancy occurring prior to the expiration of the term for which his predecessor was appointed, shall be appointed for the remainder of such term; and

(2)the terms of office of the members first taking office after the date of the enactment of this Act shall expire, as designated by the President at the time of appointment, one at the end of two years, one at the end of four years, and one at the end 636Chairman.of six years, after the date of the enactment of this Act. The President shall designate one of the members as the chairman of the Board. Duties.duties of social security board Sec. 702. The Board shall perform the duties imposed upon it by this Act and shall also have the duty of studying and making recommendations as to the most effective methods of providing economic security through social insurance, and as to legislation and matters of administrative policy concerning old-age pensions, unemployment compensation, accident compensation, and related subjects. Expenses.expenses of the board Sec. 703. Appointment and compensation of personnel. The Board is authorized to appoint and fix the compensation of such officers and employees, and to make such expenditures, as may be necessary for carrying out its functions under this Act. Appointments of attorneys and experts may be made without regard to the civil-service laws. Reports.reports Sec. 704. The Board shall make a full report to Congress, at the beginning of each regular session, of the administration of the functions with which it is charged. TITLE VIII—Title VIII—Taxes with respect to employment.Income tax on employees. TAXES WITH RESPECT TO EMPLOYMENT income tax on employees Section 801. Rates. In addition to other taxes, there shall be levied, collected, and paid upon the income of every individual a tax equal to the following percentages of the wages (as defined in section 811) received by him after December 31, 1936, with respect to employment (as defined in section 811) after such date:

(1)With respect to employment during the calendar years 1937, 1938, and 1939, the rate shall be 1 per centum.

(2)With respect to employment during the calendar years 1940, 1941, and 1942, the rate shall be 1½ Per centum.

(3)With respect to employment during the calendar years 1943, 1944, and 1945, the rate shall be 2 per centum.

(4)With respect to employment during the calendar years 1946, 1947, and 1948, the rate shall be 2½ per centum.

(5)With respect to employment after December 31, 1948, the rate shall be 3 per centum. Deduction of tax from wages.deduction of tax from wages Sec. 802. Collection by employer.

(a)The tax imposed by section 801 shall be collected by the employer of the taxpayer, by deducting the amount of the tax Liability for.from the wages as and when paid. Every employer required so to deduct the tax is hereby made liable for the payment of such tax, and is hereby indemnified against the claims and demands of any person for the amount of any such payment made by such employer.

(b)Adjustments. If more or less than the correct amount of tax imposed by section 801 is paid with respect to any wage payment, then, under regulations made under this title, proper adjustments, with respect both to the tax and the amount to be deducted, shall be made, without interest, in connection with subsequent wage payments to the same individual by the same employer. 637 deductibility from income taxDeductibility from income tax. Sec. 803. For the purposes of the income tax imposed by Title I ofVol. 48, p. 688; *Post*, p. 1014. the Revenue Act of 1934 or by any Act of Congress in substitution therefor, the tax imposed by section 801 shall not be allowed as a deduction to the taxpayer in computing his net income for the year in which such tax is deducted from his wages. excise tax on employersExcise tax on employers. Sec. 804. In addition to other taxes, every employer shall pay anPayment by.Vol. 48, pp. 688–691. excise tax, with respect to having individuals in bis employ, equal to*Post*, p. 639. the following percentages of the wages (as defined in section 811) paid by him after December 31, 1936, with respect to employment (as defined in section 811) after such date:

(1)With respect to employment during the calendar years 1937,Rates. 1938, and 1939, the rate shall be 1 per centum.

(2)With respect to employment during the calendar years 1940, 1941, and 1942, the rate shall be 1½ per centum.

(3)With respect to employment during the calendar years 1943, 1944, and 1945, the rate shall be 2 per centum.

(4)With respect to employment during the calendar years 1946, 1947, and 1948, the rate shall be 2½ per centum.

(5)With respect to employment after December 31, 1948, the rate shall be 3 per centum. adjustment of employer’s taxAdjustment of employers’ tax. Sec. 805. If more or less than the correct amount of tax imposedRegulations. by section 804 is paid with respect to any wage payment, then, under regulations made under this title, proper adjustments with respect to the tax shall be made, without interest, in connection with subsequent wage payments to the same individual by the same employer. refunds and deficienciesRefunds and deficiencies. Sec. 806. If more or less than the correct amount of tax imposed by section 801 or 804 is paid or deducted with respect to any wage payment and the overpayment or underpayment of tax cannot be adjusted under section 802

(b)or 805 the amount of the overpayment shall be refunded and the amount of the underpayment shall be collected, in such manner and at such times (subject to the statutes of limitations properly applicable thereto) as may be prescribed by regulations made under this title. collection and payment of taxesCollection and payment of taxes. Sec. 807.

(a)The taxes imposed by this title shall be collected byCollection. the Bureau of Internal Revenue under the direction of the Secretary of the Treasury and shall be paid into the Treasury of the United States as internal-revenue collections. If the tax is not paid whenTax interest on payment in default. due, there shall be added as part of the tax interest (except in the case of adjustments made in accordance with the provisions of sections 802

(b)and 805) at the rate of one-half of 1 per centum perRate. month from the date the tax became due until paid.

(b)Such taxes shall be collected and paid in such manner, at suchRegulations governing payment. times, and under such conditions, not inconsistent with this title (either by making and filing returns, or by stamps, coupons, tickets, books, or other reasonable devices or methods necessary or helpful in securing a complete and proper collection and payment of the tax or in securing proper identification of the taxpayer), as may be prescribed by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury. 638

(c)Provisions of law applicable.Vol. 44, pp. 93, 99; [U. S. C., pp. 1107, 1133](/us/usc/pp1107/1133).Vol. 48, p. 768. All provisions of law, including penalties, applicable with respect to any tax imposed by section 600 or section 800 of the Revenue Act of 1926, and the provisions of section 607 of the Revenue Act of 1934, shall, insofar as applicable and not inconsistent with the provisions of this title, be applicable with respect to the taxes imposed by this title.

(d)Fractional part of cent. In the payment of any tax under this title a fractional part of a cent shall be disregarded unless it amounts to one-half cent or more, in which case it shall be increased to 1 cent. Rules and regulations.rules and regulations Sec. 808. Authority to prescribe. The Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, shall make and publish rules and regulations for the enforcement of this title. Sale of stamps by postmasters.sale of stamps by postmasters Sec. 809. The Commissioner of Internal Revenue shall furnish to the Postmaster General without prepayment a suitable quantity of stamps, coupons, tickets, books, or other devices prescribed by the Commissioner under section 807 for the collection or payment of any tax imposed by this title, to be distributed to, and kept on sale by, all post offices of the first and second classes, and such post offices of the third and fourth classes as

(1)are located in county seats, or

(2)are certified by the Secretary of the Treasury to the Postmaster Bond.General as necessary to the proper administration of this title. The Postmaster General may require each such postmaster to furnish bond in such increased amount as he may from time to time determine, and each such postmaster shall deposit the receipts from the sale of such stamps, coupons, tickets, books, or other devices, to the credit of, and render accounts to, the Postmaster General at such times and in such form as the Postmaster General may by regulationsTransfer of receipts. prescribe. The Postmaster General shall at least once a month transfer to the Treasury as internal-revenue collections all receipts so deposited together with a statement of the additional expenditures in the District of Columbia and elsewhere incurred by the Post Office Department in performing the duties imposed upon said Department by this Act, and the Secretary of the Treasury is hereby authorized and directed to advance from time to time to the credit of the Post Office Department from appropriations made for the collection of the taxes imposed by this title, such sums as may be required for such additional expenditures incurred by the Post Office Department. Penalties.penalties Sec. 810. Unlawful use of stamps.

(a)Whoever buys, sells, offers for sale, uses, transfers, takes or gives in exchange, or pledges or gives in pledge, except as authorized in this title or in regulations made pursuant thereto, any stamp, coupon, ticket, book, or other device, prescribed by the Commissioner of Internal Revenue under section 807 for the collection or payment of any tax imposed by this title, shall be fined not more than $1.000 or imprisoned for not more than six months, or both.

(b)Counterfeiting. Whoever, with intent to defraud, alters, forges, makes, or counterfeits any stamp, coupon, ticket, book, or other device prescribed by the Commissioner of Internal Revenue under section 807 for the collection or payment of any tax imposed by this title, or uses, sells, lends, or has in his possession any such altered, forged, or counterfeited stamp, coupon, ticket, book, or other device, or makes, uses, sells, or has in his possession any material in imitation of the 639material used in the manufacture of such stamp, coupon, ticket, book, or other device, shall be fined not more than $5,000 or imprisoned not more than five years, or both. definitionsDefinitions. Sec. 811. When used in this title—

(a)The term “wages” means all remuneration for employment, “Wages.”including the cash value of all remuneration paid in any medium other than cash; except that such term shall not include that part of the remuneration which, after remuneration equal to $3,000 has been paid to an individual by an employer with respect to employment during any calendar year, is paid to such individual by such employer with respect to employment during such calendar year.

(b)The term “employment” means any service, of whatever“Employment.” nature, performed within the United States by an employee for his employer, except—

(1)Agricultural labor;

(2)Domestic service in a private home;

(3)Casual labor not in the course of the employer’s trade or business;

(4)Service performed by an individual who has attained the age of sixty-five;

(5)Service performed as an officer or member of the crew of a vessel documented under the laws of the United States or of any foreign country;

(6)Service performed in the employ of the United States Government or of an instrumentality of the United States;

(7)Service performed in the employ of a State, a political subdivision thereof, or an instrumentality of one or more States or political subdivisions;

(8)Service performed in the employ of a corporation, community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual. TITLE IX— TAX ON EMPLOYERS OF EIGHT OR MORETitle IX—Tax on employers of eight or more.Imposition of tax. imposition of tax Section 901. On and after January 1, 1936, every employer (asPercentages. defined in section 907) shall pay for each calendar year an excise tax, with respect to having individuals in his employ, equal to the following percentages of the total wages (as defined in section 907)*Post*, p. 642. payable, by him (regardless of the time of payment) with respect to employment (as defined in section 907) during such calendar year:

(1)With respect to employment during the calendar year 1936 the rate shall be 1 per centum;

(2)With respect to employment during the calendar year 1937 the rate shall be 2 per centum;

(3)With respect to employment after December 31, 1937, the rate shall be 3 per centum. credit against taxCredit against tax. Sec. 902. The taxpayer may credit against the tax imposed byContributions into unemployment funds. section 901 the amount of contributions, with respect to employment during the taxable year, paid by him (before the date of filing his return for the taxable year) into the unemployment fund under a 640Total credit.State law. The total credit allowed to a taxpayer under this section for all contributions paid into unemployment funds with respect to employment during such taxable year shall not exceed 90 per centum of the tax against which it is credited, and credit shall be allowed only for contributions made under the laws of States certified for the taxable year as provided in section 903. Certification of State laws.certification of state laws Sec. 903. Approval; conditions.

(a)The Social Security Board shall approve any State law submitted to it, within thirty days of such submission, which it finds provides that—

(1)Payment of compensation through public employment offices. All compensation is to be paid through public employment offices in the State or such other agencies as the Board may approve;

(2)No compensation shall be payable with respect to any day of unemployment occurring within two years after the first day of the first period with respect to which contributions are required;

(3)Payment to credit of Unemployment Trust Fund, All money received in the unemployment fund shall immediately upon such receipt be paid over to the Secretary of the Treasury to the credit of the Unemployment Trust Fund established by section 904;

(4)Expenditure of requisitioned funds. All money withdrawn from the Unemployment Trust Fund by the State agency shall be used solely in the payment of compensation, exclusive of expenses of administration;

(5)Refusal of employable to accept work under certain conditions. Compensation shall not be denied in such State to any otherwise eligible individual for refusing to accept new work under any of the following conditions:

(A)If the position offered is vacant due directly to a strike, lockout, or other labor dispute;

(B)if the wages, hours, or other conditions of the work offered are substantially less favorable to the individual than those prevailing for similar work in the locality;

(C)if as a condition of being employed the individual would be required to join a company union or to resign from or refrain from joining any bona fide labor organization;

(6)Amendment of State laws. All the rights, privileges, or immunities conferred by such law or by acts done pursuant thereto shall exist subject to the power of the legislature to amend or repeal such law at any time. Notification to Governor of State. The Board shall, upon approving such law, notify the Governor of the State of its approval.

(b)Annual certification by Board of approved State laws. On December 31 in each taxable year the Board shall certify to the Secretary of the Treasury each State whose law it has Restriction on approval.previously approved, except that it shall not certify any State which, after reasonable notice and opportunity for hearing to the State agency, the Board finds has changed its law so that it no longer contains the provisions specified in subsection

(a)or has with respect to such taxable year failed to comply substantially with any such provision.

(c)Notification to Governor; when. If, at any time during the taxable year, the Board has reason to believe that a State whose law it has previously approved, may not be certified under subsection (b), it shall promptly so notify the Governor of such State. Unemployment Trust Fund.Establishment.unemployment trust fund Sec. 904.

(a)There is hereby established in the Treasury of the United States a trust fund to be known as the “Unemployment Receipt of deposited funds.Trust Fund”, hereinafter in this title called the “Fund”. The Secretary of the Treasury is authorized and directed to receive and hold in the Fund all moneys deposited therein by a State agency 641from a State unemployment fund. Such deposit may be made directly with the Secretary of the Treasury or with any Federal reserve bank or member bank of the Federal Reserve System designated by him for such purpose.

(b)It shall be the duty of the Secretary of the Treasury toInvestments; duty to make. invest such portion of the Fund as is not, in his judgment, required to meet current withdrawals. Such investment may be made onlyNature of. in interest bearing obligations of the United States or in obligations guaranteed as to both principal and interest by the United States. For such purpose such obligations may be acquired

(1)onAcquisition of obligations of United States.Second Liberty Bond Act.Vol. 40, p. 288; [U. S. C., p. 1419](/us/usc/p1419).*Ante*, pp. 20, 622;*Post*, p. 699.Special obligations; Interest rate. original issue at par, or

(2)by purchase of outstanding obligations at the market price. The purposes for which obligations of the United States may be issued under the Second Liberty Bond Act, as amended, are hereby extended to authorize the issuance at par of special obligations exclusively to the Fund. Such special obligations shall bear interest at a rate equal to the average rate of interest, computed as of the end of the calendar month next preceding the date of such issue, borne by all interest-bearing obligations of the United States then forming part of the public debt; except that where such average rate is not a multiple of one-eighth of 1 per centum, the rate of interest of such special obligations shall be the multiple of one-eighth of 1 per centum next lower than such average rate. Obligations other than such special obligations may be acquiredOther obligations; acquisition of. for the Fund only on such terms as to provide an investment yield not less than the yield which would be required in the case of special obligations if issued to the Fund upon the date of such acquisition.

(c)Any obligations acquired by the Fund (except special obligationsSale of. issued exclusively to the Fund) may be sold at the market price, and such special obligations may be redeemed at par plus accrued interest.

(d)The interest on, and the proceeds from the sale or redemptionInterest and proceeds of sale credited to Fund. of, any obligations held in the Fund shall be credited to and form a part of the Fund.

(e)The Fund shall be invested as a single fund, but the SecretaryInvestment accounts. of the Treasury shall maintain a separate book account for each State agency and shall credit quarterly on March 31, June 30, September 30, and December 31, of each year, to each account, on the basis of the average daily balance of such account, a proportionate part of the earnings of the Fund for the quarter ending on such date.

(f)The Secretary of the Treasury is authorized and directed toRequisitions on Fund by States; payments. pay out of the Fund to any State agency such amount as it may duly requisition, not exceeding the amount standing to the account of such State agency at the time of such payment. administration, refunds, and penaltiesAdministration, refunds, and penalties. Sec. 905.

(a)The tax imposed by this title shall be collected byTaxes; collection of. the Bureau of Internal Revenue under the direction of the Secretary of the Treasury and shall be paid into the Treasury of the United States as internal-revenue collections. If the tax is not paid whenInterest on tax payment in default. due, there shall be added as part of the tax interest at the rate of one-half of 1 per centum per month from the date the tax became due until paid.

(b)Not later than January 31, next following the close of theReturns by employers; when to be made. taxable year, each employer shall make a return of the tax under this title for such taxable year. Each such return shall be madeForm; filing. under oath, shall be filed with the collector of internal revenue for the district in which is located the principal place of business of the 642employer, or, if he has no principal place of business in the United States, then with the collector at Baltimore, Maryland, and shall contain such information and be made in such manner as the Commissioner of Internal Revenue, with the approval of the Secretary of Provisions of law applicable.the Treasury, may by regulations prescribe. All provisions of law (including penalties) applicable in respect of the taxes imposed by Vol. 44, p. 93.section 600 of the Revenue Act of 1926, shall, insofar as not inconsistent with this title, be applicable in respect of the tax imposed by this title. The Commissioner may extend the time for filing the return of the tax imposed Extension of time for filing.by this title, under such rules and regulations as he may prescribe with the approval of the Secretary of the Treasury, but no such extension shall be for more than sixty days.

(c)Publicity of returns. Returns filed under this title shall be open to inspection in the same manner, to the same extent, and subject to the same Vol. 44, p. 51.provisions of law, including penalties, as returns made under Title II of the Revenue Act of 1926.

(d)Installment payment of tax. The taxpayer may elect to pay the tax in four equal installments instead of in a single payment, in which ease the first installment shall be paid not later than the last day prescribed for the filing of returns, the second installment shall be paid on or before the last day of the third month, the third installment on or before the last day of the sixth month, and the fourth installment on or before, the last day of the ninth month, after such last day. If the tax or any installment thereof is not paid on or before the last day of the period fixed for its payment, the whole amount of the tax unpaid shall be paid upon notice and demand from the collector.

(e)Extensions authorized. At the request of the taxpayer the time for payment of the tax or any installment thereof may be extended under regulations prescribed by the Commissioner with the approval of the Secretary of the Treasury, for a period not to exceed six months from the last day of the period prescribed for the payment of the tax or any installment thereof. The amount of the tax in respect of which any extension is granted shall be paid (with interest at the rate of one-half of 1 per centum per month) on or before the date of the expiration of the period of the extension.

(f)Fractional part of cent. In the payment of any tax under this title a fractional part of a cent shall be disregarded unless it amounts to one-half cent or more, in which case it shall be increased to 1 cent. Interstate commerce.interstate commerce Sec. 906. Persons engaged in; payments. No person required under a State law to make payments to an unemployment fund shall be relieved from compliance therewith on the ground that he is engaged in interstate commerce, or that the State law does not distinguish between employees engaged in interstate commerce and those engaged in intrastate commerce. Definitions.definitions Sec. 907. When used in this title—

(a)“Employer.” The term “employer” does not include any person unless on each of some twenty days during the taxable year, each day being in a different calendar week, the total number of individuals who were in his employ for some portion of the day (whether or not at the same moment of time) was eight or more.

(b)“Wages.” The term “wages” means all remuneration for employment, including the cash value of all remuneration paid in any medium other than cash. 643

(c)The term “employment” means any service, of whatever“Employment.” nature, performed within the United States by an employee for his employer, except—

(1)Agricultural labor;

(2)Domestic service in a private home;

(3)Service performed as an officer or member of the crew of a vessel on the navigable waters of the United States;

(4)Service performed by an individual in the employ of his son, daughter, or spouse, and service performed by a child under the age of twenty-one in the employ of his father or mother;

(5)Service performed in the employ of the United States Government or of an instrumentality of the United States;

(6)Service performed in the employ of a State, a political subdivision thereof, or an instrumentality of one or more States or political subdivisions;

(d)The term “State agency” means any State officer, board, or“State agency.” other authority, designated under a State law to administer the unemployment fund in such State.

(e)The term “unemployment fund” means a special fund,“Unemployment fund.” established under a State law and administered by a State agency, for the payment of compensation.

(f)The term “contributions” means payments required by a“Contributions.” State law to be made by an employer into an unemployment fund, to the extent that such payments are made by him without any part thereof being deducted or deductible from the wages of individuals in his employ.

(g)The term “compensation” means cash benefits payable to“Compensation.” individuals with respect to their unemployment. rules and regulationsRules and regulations. Sec. 908. The Commissioner of Internal Revenue, with theAuthority to prescribe. approval of the Secretary of the Treasury, shall make and publish rules and regulations for the enforcement of this title, except sections 903, 904, and 910. allowance of additional creditAllowance of additional credit. Sec. 909.

(a)In addition to the credit allowed under section 902,Deduction of contributions from tax. a taxpayer may, subject to the conditions imposed by section 910, credit against the tax imposed by section 901 for any taxable year after the taxable year 1937, an amount, with respect to each State law, equal to the amount, if any, by which the contributions, with respect to employment in such taxable year, actually paid by the taxpayer under such law before the date of filing his return for such taxable year, is exceeded by whichever of the following is the lesser—

(1)The amount of contributions which he would have beenAmounts. required to pay under such law for such taxable year if he had been subject to the highest rate applicable from time to time throughout such year to any employer under such law; or

(2)Two and seven-tenths per centum of the wages payable by him with respect to employment with respect to which contributions for such year were required under such law. 644

(b)If the amount of the contributions actually so paid by the taxpayer is less than the amount which he should have paid under the State law, the additional credit under subsection

(a)shall be reduced proportionately.

(c)Total credits allowed. The total credits allowed to a taxpayer under this title shall not exceed 90 per centum of the tax against which such credits are taken. Conditions of additional credit allowance.conditions of additional credit allowance Sec. 910. When credit allowance to be granted.

(a)A taxpayer shall be allowed the additional credit under section 909, with respect to his contribution rate under a State law being lower, for any taxable year, than that of another employer subject to such law, only if the Board finds that under such law—

(1)Such lower rate, with respect to contributions to a pooled fund, is permitted on the basis of not less than three years of compensation experience;

(2)Such lower rate, with respect to contributions to a guaranteed employment account, is permitted only when his guaranty of employment was fulfilled in the preceding calendar year, and such guaranteed employment account amounts to not less than 7½ per centum of the total wages payable by him, in accordance with such guaranty, with respect to employment in such State in the preceding calendar year;

(3)Such lower rate, with respect to contributions to a separate reserve account, is permitted only when

(A)compensation has been payable from such account throughout the preceding calendar year, and

(B)such account amounts to not less than five times the largest amount of compensation paid from such account within any one of the three preceding calendar years, and

(C)such account amounts to not less than 7½ per centum of the total wages payable by him (plus the total wages payable by any other employers who may be contributing to such account) with respect to employment in such State in the preceding calendar year.

(b)Reductions. Such additional credit shall be reduced, if any contributions under such law are made by such taxpayer at a lower rate under conditions not fulfilling the requirements of subsection (a), by the amount bearing the same ratio to such additional credit as the amount of contributions made at such lower rate bears to the total of his contributions paid for such year under such law.

(c)Definitions. As used in this section—

(1)“Reserve account.” The term “reserve account” means a separate account in an unemployment fund, with respect to an employer or group of employers, from which compensation is payable only with respect to the unemployment of individuals who were in the employ of such employer, or of one of the employers comprising the group.

(2)“Pooled fund.” The term “pooled fund” means an unemployment fund or any part thereof in which all contributions are mingled and undivided, and from which compensation is payable to all eligible individuals, except that to individuals last employed by employers with respect to whom reserve accounts are maintained by the State agency, it is payable only when such accounts are exhausted.

(3)“Guaranteed employment account.” The term “guaranteed employment account” means a separate account, in an unemployment fund, of contributions paid by an employer (or group of employers) who

(A)guarantees in advance thirty hours of wages for each of forty calendar weeks (or more, with one weekly hour deducted for each added week guaranteed) in twelve months, to all the individuals in his employ in one or more distinct establishments, except that any such individual’s guaranty may commence after 645a probationary period (included within twelve or less consecutive calendar weeks), and

(B)gives security or assurance, satisfactory to the State agency, for the fulfillment of such guaranties, from which account compensation shall be payable with respect to the unemployment of any such individual whose guaranty is not fulfilled or renewed and who is otherwise eligible for compensation under the State law.

(4)The term “year of compensation experience”, as applied to“Year of compensation experience.” an employer, means any calendar year throughout which compensation was payable with respect to any individual in his employ who became unemployed and was eligible for compensation. TITLE X— GRANTS TO STATES FOR AID TO THE BLINDGrants to States for aid to blind. appropriationAppropriation. Section 1001. For the purpose of enabling each State to furnishSum authorized.*Post*, pp. 1113, 1606. financial assistance, as far as practicable under the conditions in such State, to needy individuals who are blind, there is hereby authorized to be appropriated for the fiscal year ending June 30, 1936, the sum of $3,000,000, and there is hereby authorized to be appropriated for each fiscal year thereafter a sum sufficient to carry out the purposes of this title. The sums made available under this sectionAvailability to States. shall be used for making payments to States which have submitted, and had approved by the Social Security Board, State plans for aid to the blind. state plans for aid to the blindState plans for aid to blind. Sec. 1002.

(a)A State plan for aid to the blind must

(1)provideRequirements. that it shall be in effect in all political subdivisions of the State, and, if administered by them, be mandatory upon them;

(2)provide for financial participation by the State;

(4)provide for granting to any individual, whose claim for aid is denied, an opportunity for a fair hearing before such State agency;

(7)provide that no aid will be furnished any individual under the plan with respect to any period with respect to which he is receiving old-age assistance under the State plan approved under section 2 of this Act.

(b)The Board shall approve any plan which fulfills the conditionsApproval by Board. specified in subsection (a), except that it shall not approve any plan which imposes, as a condition or eligibility for aid to the blind under the plan—

(1)Any residence requirement which excludes any resident of the State who has resided therein five years during the nine years immediately preceding the application for aid and has resided therein continuously for one year immediately preceding the application; or 646

(2)Any citizenship requirement which excludes any citizen of the United States. Payment to States.payment to states Sec. 1003. Amount to be paid quarterly.

(a)From the sums appropriated therefor, the Secretary of the Treasury shall pay to each State which has an approved plan for aid to the blind, for each quarter, beginning with the quarter commencing July 1, 1935,

(1)an amount, which shall be used Matching funds by States.exclusively as aid to the blind, equal to one-half of the total of the sums expended during such quarter as aid to the blind under the State plan with respect to each individual who is blind and is not an inmate of a public institution, not counting so much of such expenditure with respect to any individual for any month as Administration costs.exceeds $30, and

(2)5 per centum of such amount, which shall be used for paying the costs of administering the State plan or for aid to the blind, or both, and for no other purpose.

(b)Method of computing and paying amounts.Estimates to be submitted.Basis of. The method of computing and paying such amounts shall be as follows:

(1)The Board shall, prior to the beginning of each quarter, estimate the amount to be paid to the State for such quarter under the provisions of clause

(1)of subsection (a), such estimate to be based on

(A)a report filed by the State containing its estimate of the total sum to be expended in such quarter in accordance with the provisions of such clause, and stating the amount appropriated or made available by the State and its political subdivisions for such expenditures in such quarter, and if such amount is less than one-half of the total sum of such estimated expenditures, the source or sources from which the difference is expected to be derived,

(B)records showing the number of blind individuals in the State, and

(C)such other investigation as the Board may find necessary.

(1)of subsection

(a)for such quarter, except to the extent that such sum has been applied to make the amount certified for any prior quarter greater or less than the amount estimated by the Board for such prior quarter.

(1)that the plan has been so changed as to impose any residence or citizenship requirement prohibited by section 1002 (b), or that in the administration of the plan any such prohibited requirement is imposed, with the knowledge of such State agency, in a substantial number of cases; or

(2)that in the administration of the plan there is a failure to comply substantially with any provision required by section 1002 647(a) to be included in the plan; the Board shall notify such State agency that further payments "will not be made to the State until the Board is satisfied that such prohibited requirement is no longer so imposed, and that there is no longer any such failure to comply. Until it is so satisfied it shall make no further certification to the Secretary of the Treasury with respect to such State. administrationAdministration. Sec. 1005. There is hereby authorized to be appropriated for theAppropriation authorized for Board expenses. fiscal year ending June 30, 1936, the sum of $30,000, for all necessary expenses of the Board in administering the provisions of this title. definitionDefinition. Sec. 1006. When used in this title the term “aid to the blind”“Aid to the blind.” means money payments to blind individuals. TITLE XI— GENERAL PROVISIONSGeneral provisions. definitionsDefinitions. Section 1101.

(a)When used in this Act—

(1)The term “State” (except when used in section 531)“State.” includes Alaska, Hawaii, and the District of Columbia.

(2)The term “United States” when used in a geographical“United States.” sense means the States, Alaska, Hawaii, and the District of Columbia.

(3)The term “person” means an individual, a trust or estate,“Person.” a partnership, or a corporation.

(4)The term “corporation” includes associations, joint-stock “Corporation.”companies, and insurance companies.

(5)The term “shareholder” includes a member in an association,“Shareholder.” joint-stock company, or insurance company.

(6)The term “employee” includes an officer of a corporation.“Employee.”

(b)The terms “includes” and “including” when used in a definition“Includes”; “including.” contained in this Act shall not be deemed to exclude other things otherwise within the meaning of the term defined.

(c)Whenever under this Act or any Act of Congress, or underAmounts deducted from remuneration of employee. the law of any State, an employer is required or permitted to deduct any amount from the remuneration of an employee and to pay the amount deducted to the United States, a State, or any political subdivision thereof, then for the purposes of this Act the amount so deducted shall be considered to have been paid to the employee at the time of such deduction.

(d)Nothing in this Act shall be construed as authorizing anyChildren: care and custody. Federal official, agent, or representative, in carrying out any of the provisions of this Act, to take charge of any child over the objection of either of the parents of such child, or of the person standing in loco parent is to such child. rules and regulationsRules and regulations. Sec. 1102. The Secretary of the Treasury, the Secretary of Labor, and the Social Security Board, respectively, shall make and publish such rules and regulations, not inconsistent with this Act, as may be necessary to the efficient administration of the functions with which each is charged under this Act. 648 Separability of provisions.separability Sec. 1103. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the remainder of the Act, and the application of such provision to other persons or circumstances shall not be affected thereby. Reservation of power.reservation of power Sec. 1104. The right to alter, amend, or repeal any provision of this Act is hereby reserved to the Congress. Short title.short title Sec. 1105. This Act may be cited as the “Social Security Act”. Approved, August 14, 1935. To amend the Packers and Stockyards Act. 1935-08-14 532 Chapter 49 Stat. 648 74 1 United States Government Publishing Office text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain. Digitization Vendor 2025-01-07 public [CHAPTER 532.] AN ACT To amend the Packers and Stockyards Act. August 14, 1935.[[S. 12](/us/bill/74/s/12).][

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49 Stat. 648

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Public Law 271

to revise air-mail laws, and to establish a commission to make a report to the Congress 615recommending an aviation policy”, approved June 12, 1934, as amended (48 Stat. 933, 1243), is amended to read as follows: " “Sec. 3. (a) The Postmaster General is authorized to award contractsContracts for car

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