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an allotment to that farm and have the farmer leave some of the land he had in the same status.
For example, if I own a piece of land and I am farming it and I get a 2-bale exemption and I have a base production of so many bales, and I am given my exemption. Over here Mr. Fulmer has a tenant that has a base production on his land of 2 bales, and he is going to farm that same land again. Now, does it seem to be a reasonable basis of classification to say that you will classify me as the small farmer and give me the exemption and that the man who controls that land and has been on that land for a year-he controls it, because Mr. Fulmer cannot put him off; he has complete control of it would not be entitled to the exemption?
Mr. Hiss. May I answer that question, Mr. Chairman, by asking you a question: Do you think that as between the tenant who happens to farm a farm this year, the identical land that he farmed last year, and the tenant who is given a new piece of land there is any reason for making a distinction?
The CHAIRMAN. Well, if this tenant should farm Mr. Fulmer's land and the next year go over to Mr. Doxey, and on each farm he had had exactly two, it seems to me that there would be no difficulty in working it out between them.
Mr. Hiss. I should think they would have to be treated the same. It seems to me there is no reasonable, justifiable distinction between the tenant who has had an allotment of two bales, for instance, and moves from one farm to another; it seems to me he ought to be treated in the same way.
The CHAIRMAN. I think he should have to be.
Mr. Hiss. The point that I was making was this, that if you start in to pass on the individual tenant instead of taking the land that is farmed, there will in any case have to be a history of the land that is farmed in order to make an allotment to the tenant. And in the making of that allotment the landlord would undoubtedly try to arrange to have as many portions of the land exempted as he could. You would have gerrymandering for the two bales, and the farmers who under such an exemption should get only 1 instead of 2 bales, on the basis of past history, would endeavor to get a larger quantity, by gerrymandering for a greater allotment.
The CHAIRMAN. I agree with you in the difficulties that would arise by making it on a personal basis, but could you justify a distinction or a classification of farmers, the one who owned title to the land, who got two bales, as between another fellow who, for the time being, was a tenant on another man's land?
Mr. Hiss. I should say that the basis of justification, Mr. Chairman, would be the administrative impossibility of handling it on the tenant basis.
The CHAIRMAN. Even though the distinction was not reasonable? Mr. Hiss. I cannot say what the Supreme Court would decide, of
The CHAIRMAN. You are given the total allotment; the act gives you the total allotment.
Mr. Hiss. That is true, and that allotment is made to the entire farm, based on the entire farm, and that principle is carried out, but where you undertake to make it on the tenant allotment basis you
would have the same kind of gerrymandering that I have been referring to, as between farms.
The CHAIRMAN. I do not see why you would have any gerrymandering if you made it under this plan, take all of the land that is farmed this year, within that classification.
Mr. Hiss. Because, Mr. Chairman, if a landowner divided his 4 acres, with a 3-bale base, among the tenants, and a tenant moves from one place to another it may mean that he will only have a 2-bale exemption
The CHAIRMAN. I do not mean if it is going to be made on a personal basis alone, but assuming that you have it based on that particular land.
Mr. Hiss. But he would have to base it on the land that is leased to him as a tenant and he would take what is picked for him by the landlord, and if you have a two-bale exemption
The CHAIRMAN (interposing). But suppose I have a farm that has as a basis of 2 bales, produces an average of 2 bales or less on that particular land. Certainly the tenant would be in the same classification as the owner, the fellow who owned that land.
Mr. Hiss. Mr. Chairman, that brings us back to the discussion of the point I raised before of the impossibility of getting the history of the tenant farmers, those who have moved from one place to another for many years, and other tenants who happened to go from one farm to another. I do not think it would be possible of administration.
The CHAIRMAN. I think you could make the tenant show that if it was necessary, as a part of his application; make it one of his requirements that the tenant furnish you the information that he had a base for the last year of 2 bales and that part of the farm which he farmed could be separated this coming year and show that it had produced less than 2 bales.
I think, in other words, if you made both of these requirements you would avoid gerrymandering and certainly on the basis of pure justice he would have just as much right as the individual farmer who owns his land.
Mr. Hiss. But drawing the distinction between that tenant, answering your question, and the tenant who has been farming Mr. Doxey's land, for instance; it would not be justifiable to draw that distinction.
The CHAIRMAN. I think if it is necessary the distinction can be made and made legally, because, of course, you could not allot everybody in the United States two bales, because you would soon get down, in making your exemptions, to where you would have no exemptions.
Mr. Hiss. Yes.
The CHAIRMAN. You have got to have reasonable safeguards against it.
Mr. Hiss. Yes.
The CHAIRMAN. It seems to me, however, that the matter can be so changed and safeguarded that the tenant farmer and the share cropper, who complies in essence and in fact with the requirements as to production and as to land on which the production is made, if made to comply with both, would come within the classification.
And if you cannot do that it seems to me there is going to be a great deal of difficulty ahead of you, and I think that the thing has to be brought out very carefully and very thoroughly.
Mr. Hiss. Would the committee like to receive a report from the Department on this subject?
The CHAIRMAN. I am quite sure that the committee would like to have such a report on that particular phase of it; yes.
Mr. Hiss. Yes.
Mr. DOXEY. I would like to ask you a question before we leave that.
The CHAIRMAN. Mr. Doxey.
Mr. DOXEY. Mr. Hiss, my illustration with respect to 3 tenants and getting 6 more, making 9, was only for the purpose of seeing that the whole matter would be considered.
Mr. HISS. Yes.
Mr. DOXEY. As a practical proposition the county committee would see that justice is done in handling the matter and handle it very carefully. They know, and to use the illustration I have, taking the 6 tenants and increasing it to 9, they would know it would be for the purpose of trying to come within the law, and if you had the right kind of a county committee, you people down here in the Department need not worry so much about that; they are going to see that it is handled properly. Your county committee knows that their acts are going to be made public, as we provide here, you will get some good practical results; the base made by the committee will work out all right.
Now, I think the evils anticipated in a practical way will be limited, and it can be effectively worked out if handled by a good county committee.
Now, that is just contributed for you to think about.
I want to ask you this question: Is this authority that you rely on in the present law, to which you referred, your only authority for making these exemptions?
Mr. Hiss. Yes.
Mr. DOXEY. I do not mean to argue with you, of course, but we know that under this particular section you could not extend an exemption to any individual farmer.
Mr. HISS. Whether or not on the basis of
Mr. DOXEY (interposing). Under this section, to individual farmers.
Mr. Hiss. My answer to Mr. Jones' question to that matter was from an administrative point of view. I think the same authority that would permit exemption to farms would permit exemption to individuals.
Mr. DOXEY. Where is there in this subsection (3) of section 7 (a) anything that will permit you to extend an exemption to the individual farmer? The real producer, be he owner, tenant, or share
Mr. Hiss. Let me point that out to you, Mr. Doxey: Under the section that makes the allotment to the individual farm
Mr. DOXEY (interposing). Let me interrupt you at that point. This whole tenor of this whole law was with reference to allotments,
and there was not anything in there with reference to exemptions, except as merely an incident to the main purpose of the original act. Mr. Hiss. There was.
Mr. DOXEY. And you have given an interpretation that it does not give you the authority, and you are going to have just an interpretation of it, based on a general requirement that this was the intention of Congress, in reference to allotments, and you are going to make exemptions with that idea, to farmers and to individuals.
Mr. Hiss. Mr. Doxey, under section 4 the statute specifically provides there shall be an exemption from taxation of the amount of cotton harvested in any crop year from each farm equal to its allotment, which shall be evidenced by a certificate of exemption issued as herein provided, which certificate of exemption shall be conclusive proof of the right of such exemption. And the Secretary can find out and apportion the allotment to different people, provide for a base of classification of those people, on a reasonable basis. Therefore, he can give allotments to one group and apportion it among that group.
Mr. DoXEY. I just wanted to get your views about it.
The CHAIRMAN. Mr. Kleberg.
Mr. KLEBERG. In reference to your question of Mr. Hiss, involving the interpretation of section 3, about section (3) of section 7 (a), the last paragraph says:
The Secretary of Agriculture, in determining the manner of allotment to individual farmers, shall provide that the farmers who have voluntarily reduced their cotton acreage shall not be penalized in favor of those farmers who have not done so.
Now, in interpreting that section, should not the 2-bale tenant and share cropper, the farmer who had voluntarily reduced his acreage be considered, knowing that every single farmer in this country is affected by the exemption to the extent that it is going to affect the limited amount of 10,000,000 bales, and if you are going to give a certain number of exemptions to certain groups every farmer in some way is affected by taking from him in order that you may add to another group, and has been stated here, you could not take away from one without affecting the exemption to others; you could not penalize the farmer under this section who had complied with the exemption, the voluntary reduction, on the same basis that you did the man who had not complied.
Mr. Hiss. I think you are right, Mr. Kleberg.
Mr. KLEBERG. You could not take away the allotment; in no case in making an allotment can do so without taking into consideration the farmers who have voluntarily reduced their cotton, and you cannot penalize those in favor of farmers who have not done so, the farmer who has complied fully with the program for the purpose of making those reductions.
In other words, make an exemption between the two men, for instance, the farmer who has farmed his own land, we will say, and the tenant, share-cropper, or the private farmer, who has not done so; the one who has complied with the program.
Mr. Hiss. Who has complied with the voluntary reduction program?
Mr. KLEBERG. Yes.
Mr. Hiss. Yes.
Mr. BOILEAU. May I ask a question, Mr. Chairman?
Mr. BOILEAU. Section 6, in reference to application for certificate, provides that they shall make application for certificates, and as I understand, allotment was made to the farmers of tax-exempt certificates, or to producers.
Mr. Hiss. That is correct.
Mr. BOILEAU. The section provides:
A producer of cotton desiring to secure a tax-exemption certificate may file an application therefor with the agent designated by the Secretary of Agriculture, accompanied by a statement under oath showing the approximate quantity of cotton produced on the lands presently owned, rented, sharecropped, or controlled by the applicant during a representative period fixed by the Secretary of Agriculture.
Does not that, in your mind, clearly show the intent of Congress that this act should deal equally, deal alike with the renter, sharecropper, and all alike? Does not that show it was the clear intention that there should be no discrimination as between the owner of the land and the share-cropper?
Mr. Hiss. I think so.
Mr. BOILEAU. Do you think a discrimination, as a legal proposition, would not be made under the program here proposed among the share-cropper and renters and the land owners?
Mr. Hiss. So far as I am able to determine, Mr. Boileau, the discrimination, if any, is inevitable in order to carry out the program.. Mr. BOILEAU. Suppose the act was drawn so that the exemption certificate shall be given to only renters and share-croppers without discrimination, I do not see then how you people can regulate, under the authority of this act, or find any authority that would provide for more certificates to be given to the owner than to the share-cropper or renter of the land.
Mr. Hiss. I can only repeat what I hope to be an answer to the question that was put to me before, that under any act
Mr. BOILEAU. What was that?
Mr. Hiss. Under any act it may be that it is impossible, administratively, to avoid some discrimination. If the administrative difficulty is great enough you can justify some discrimination
Mr. BOILEAU (interposing). Does not the fact that Congress put that language in there indicate there was to be no discrimination? Mr. Hiss. I do not think so; I think it was to be avoided as far as possible.
Mr. BOILEAU. As far as possible?
Mr. Hiss. Yes.
Mr. BOILEAU. If you are going to exempt two bales for the owner of the land you could also exempt two bales for the share-cropper and the renter?
Mr. Hiss. So I understand.
Mr. BOILEAU. Does not that run along the same theory, that so far as your understanding is concerned, that if you can exempt the one you can the other?