the association. As a result of this method of operation, in the course of years a material change occurs in the membership of an association and it must therefore be recognized that a considerable number of those members whose dividends were reduced by the payment of these taxes 10 or more years ago are no longer in a position to benefit from the refund proposed to be made to the association at this time. Therefore, the proposed refund, if allowed, will constitute a bonus to a majority of the present members and will benefit few of those members who in reality paid the tax.

Orderly administration of its affairs compels the Treasury Department to take the position that the bar of the statute of limitations should in no case be removed. If the merits of each case are to be considered in determining whether a claim for refund barred by the statute of limitations should be paid, it is believed that Congress would be deluged with requests for such consideration, many more meritorious than the present one. It is therefore the opinion of the Treasury Department that sound public policy demands that every request for the refund of taxes after the expiration of the period, prescribed by law, within which such taxes may be recovered, should be denied.

For the reasons stated, the Treasury Department is opposed to the enactment of S. 1523.

Very truly yours,

W. H. WOODIN, Secretary of the Treasury.

O

74TH CONGRESS 1st Session

SENATE

{

REPORT No. 226

ALTERING THE APPORTIONMENT TO CERTAIN STATES FOR PUBLIC EMPLOYMENT OFFICES

FEBRUARY 26, 1935.-Ordered to be printed

Mr. WALSH, from the Committee on Education and Labor, submitted the following

REPORT

(To accompany S. 147)

The Committee on Education and Labor, to whom was referred the bill (S. 147) to alter the amount apportioned to certain States for public employment offices affiliated with the United States Employment Service, having considered the same, report favorably thereon with the recommendation that the bill be passed.

The purpose of the bill is to permit an appropriation of not less than $10,000 to each State for its assistance in the establishment of local employment offices. Under existing law (the Wagner-Peyser Act, June 6, 1933, 48 Stat. 113-114) the appropriation of $3,000,000 there provided must be

apportioned by the Director among the several States in the proportion which their population bears to the total population of the States of the United States according to the next preceding United States census.

By a strict application of this rule, four States-Delaware, Nevada, Vermont, and Wyoming-and the Territories of Alaska and Hawaii, receive amounts less than $10,000.

It is the opinion of the Department of Labor that employment offices cannot be effectively established with a total fund available for operation of less than $20,000; that is $10,000 apportioned by the Federal Government and $10,000 raised by the State itself. Under the present law, no money shall be appropriated in any State unless and until an equivalent sum has been appropriated for any year by the State; so that unless the State matches the appropriation of the Federal Government, it is not permitted to participate in the benefits of this legislation. It may be seen that if Nevada, for example, with its present apportioned amount of $2,220 even matches that amount, it yet has an inadequate fund with which to establish a competent employment service.

S. Repts., 74-1, vol. 1-18

The bill does not increase the total appropriation, but merely effects a redistribution to the different States, whereby the 44 States who are now receiving substantial sums are called upon to make up the difference between the amounts now received by the 4 States named and the $10,000 which the bill provides for each of them. The cost of this redistribution to each of the 44 States is only a few hundred dollars.

The favorable report of the Secretary of Labor, explaining the measure more in detail, together with a tabulation indicating the distribution of $3,000,000 appropriated by Congress for the fiscal year 1935, are printed as follows:

Hon. DAVID I. WALSH,

United States Senate, Washington, D. C.

LABOR DEPARTMENT, Washington, January 25, 1935.

MY DEAR SENATOR WALSH: I have your letter of January 23 asking for the views of the Department of Labor concerning S. 147, "A bill to alter the amount apportioned to certain States for public employment offices affiliated with the United States Employment Service", which has been referred to the Senate Committee on Education and Labor.

I am heartily in favor of the passage of this bill in the form in which it has been introduced by Senator Wagner.

Under the Wagner-Peyser Act as it now stands (act of June 6, 1933, chap. 49; 48 Stat. 113, 114; U. S. C., title 30, sec. 49 (d)) it is provided that the $3,000,000 appropriated for allotment among the several States "shall be apportioned by the Director among the several States in the proportion which their population bears to the total population of the States of the United States according to the next preceding United States Census." The strict application of this rule has worked a hardship in several jurisdictions where the population is relatively small. Thus, for example, under the rule of apportionment provided in the statute, the following States and territories receive apportionments of less than $10,000:

Delaware, $5,820; Nevada, $2,220; Vermont, $8,790; Wyoming, $5,520; Alaska, $1,440; Hawaii, $1,000.

Even when a State is prepared to match the amount of the Federal apportionment, it is obvious that the combined total would hardly suffice to establish upon a sound basis a public employment office. The Director of the United States Employment Service and I are both of the opinion that in no State can a creditable State employment service be established with a total fund available for its operation of less than $20,000; that is $10,000 apportioned by the Federal Government and $10,000 raised by the State itself.

S. 147, the bill introduced by Senator Wagner, and now under consideration by your committee, proposes to change the Wagner-Peyser Act so that to every State and Territory, regardless of population, the Federal Government shall apportion no less than $10,000. This minimum sum, or any part thereof, will become available to any State willing to match the Federal grant (provided, however, as the Wagner-Peyser Act stipulates, appropriations are no less than $5,000).

It seems to me that immediate action should be taken upon this bill for two reasons. First, if the President's plans for economic security are embodied in legislation at this session of Congress it will be essential to have local employment services in each of the 48 States; and it would be unfortunate if any State hesitated to set up such an employment service merely because the Federal Government was unwilling to advance $10,000 for the operation of the agency. In the second place, in a number of States, including two of those mentioned above, there exists a feeling that the Wagner-Peyser Act operates unfairly toward them, and that they are afforded by the Federal Government much less than half the sum necessary to operate a public employment office.

In order that there may be no confusion I had, perhaps, better add in closing that the present bill does not increase the total amount to be appropriated by the United States for carrying out the Wagner-Peyser Act. All that this bill does is to make a slight shift in the apportionment among the several States and Territories.

For the convenience of the committee I am enclosing a tabulation showing the distribution of the $3,000,000 appropriated by Congress for the fiscal year 1935, and intended for apportionment among the several States.

Sincerely yours,

FRANCES PERKINS, Secretary.

Population of the 48 States and the Territories of Alaska and Hawaii (1930) with distribution in proportion to population of $1,125,000 fiscal year 1934 and of $3,000,000 fiscal year 1935