AGRICULTURAL RELIEF A01 eliminated. It is also recommended that the reference ij i i Capper-Volstead Act be eliminated, since if the section. Co limited to on outs to cooperative associations, the reference to the Capper-Volstead Act is ay ory ml ee section can thus be shortened. ’ ha . Marketing agreements (sec. 7): 1. It is recomme i i be amended to provide for an investigation by the oe GA Soot finding upon which operations with any commodity through marketing agree- ments and equalization fees are to be based. The amendment should provide that this investigation shall be undertaken by the board upon the request of the lead- ing cooperative associations and farm organizations representing the producers of a commodity for which assistance in handling the surplus is sought, or upon request of the advisory councils representing districts having a majority of the production of the commodity, or by the board upon its own motion. : This change in section 7 would thereby eliminate the following finding required of the board: “Third. That the advisory council for such commodity or a substantial number of cooperative associations (or other organizations of producers) of the com- modity favor the full cooperation of the board in the marketing of the surplus of the commodity.” This change is recommended to remove one of the constitutional questions raised by the Attorney General, who objected that the provision in the former bill which required the consent of cooperative associations or advisory councils to operations by the board with any commodity, constituted an unconstitutional delegation to unofficial bodies of the power to determine when the regulation of commerce intended in section 7 would go into effect. This constitutional ques- tion will be entirely removed if the amendment which we recommend is adopted. 2. We recommend that the second finding in S. 1176 be included as one of the findings in this section of the House bill. That provision is as follows: “Second. That the operation of the provisions of section 5 relating to loans to cooperative associations will not be effective to control such surplus because of the inability or unwillingness of the cooperative associations handling such commodity to control such surplus with the assistance of such loans.” If this finding is required to be made, marketing agreements would be under- taken and the equalization fee imposed only when the board found them to be indispensable to the regulation of commerce outlined in the declaration of policy. If cooperative associations were found to be able and willing with the assistance of loans, to handle the surplus so as to carrv out the purposes set forth in the declaration of policy, the board would not he required to emvlov the marketing agreement and the equalization fee. 3. The term ‘surplus’ should be broadened in this section so as to make it clear that anv domestic national surplus, whether it is seasonal or year’s total in nature, can be dealt with by the board through marketing agreements, and the power of the board to treat as surplus any portion of the crop which it may become necessary to handle through marketing agreements in order to carrv out the policy declared in Section 1, should not be restricted. V. Insurance (new section): It is recommended that a new section be inserted to provide for insurance agreements with cooperative associations of the character recommended to the committee by representatives of the Mississippi Staple Cotton Cooperatives Association, and indorsed by the other cooperatives and farm organizations. This section should be drawn in such detail as to set forth explicitly the nature of the insurance agreement which the board is authorized to make. The insurance section should provide: } (a) That an insurance agreement may be applied only to such staple agricul- tural commodities as are regularly dealt in on an exchange or market in such volume as to establish at all times a recognized market price for its market grades, and then only when such market or exchange has price records covering a sufficient number of vears to constitute a basis for the insurance. } (b) That an insurance agreement may apply only to a 12-month period com- mencing with the delivery season for such a commodity. (¢) That an insurance agreement should cover only the difference between (1) the average market price for a basic grade of the commodity in the market designated in the agreement, weighted for the days and volume of sales bv the association insured, and (2) the average price for the same market and grade weighted for the dave and volume of deliveries to such association bv its mem bera