2896

A meeting of the Board of Governors of the Federal Reserve

Stem was held in Washington on Monday, December 30, 1935, at 11:30

a. in.

the

PRESENT: Mr. Eccles, ChairmanMr. Thomas, Vice ChairmanMr. HamlinMr. MillerMr. JamesMr. Szymczak

Mr. Morrill, SecretaryMr. Bethea, Assistant SecretaryMr. Carpenter, Assistant Secretary

The Board acted upon the following matters:

Memorandum dated December 26, 1935, from Mr. Smead, Chief of

Division of Bank Operations, recommending the appointment of Mrs.

hatrice S. McLelland as a comptometer operator in the Division, with

salary at the rate of 1,520 per annum, effective January 2, 1936, sub-

ject to her Passing satisfactorily the usual physical examination.

Approved unanimously.

Memorandum dated December 24, 1935, from Mr. James submitting

letters dated December 9 and 19 from Mr. Larson, Assistant Cashier of

the Federal Reserve Bank of Yinneapoliv, which requested approval of a

ehellge in the personnel classification plan of the bank to provide for

44 increase in the salary range for the appraised position of Equipment

hlecuuanic in the General Service Department from ,r6100 to200 per annum.

memorandum stated that the proposed change had been reviewed and

l'eeommended that it be approved.

Approved unanimously.

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Telegram to Mr. Fletcher, Acting Federal Reserve Agent at the

Federal Reserve Dank of Cleveland, reading as follows:

"Reference your letter of December 24 inclosing copy ofletter of December 20 from lBancohio Corporation', Columbus,Ohio relating to voting permit application of such corpora-tion. Having authorized issuance of general voting permit toapplicant subject to standard conditions, Board does not feelthat it should grant limited permit entitling applicant tovote to elect directors and to act upon routine matters at1936 annual meetings of stockholders of its subsidiary mem-ber banks. The tentative draft of the standard conditions tobe prescribed by the Board in connection with the granting ofgeneral voting permits was submitted to and considered by theapplicant some weeks ago. With respect to such tentativedraft of the standard conditions Bancohio Corporation wrote aletter to you dated November 18, 1935 stating: 'These regu-lations have had the consideration of our board of directorsand we believe them to be reasonable, workable and advisable.We are ready to subscribe to the regulations as submitted.'In view of fact that standard conditions as finally adoptedare substantially similar to those contained in tentativedraft submitted to Bancohio Corporation, Board believes thatapplicant mnd its attorneys will have ample time to completetheir consideration of the prescribed agreement containingthe standard conditions. Please advise applicant accordingly."

Approved unanimously.

Telegram to Mr. Wood, Federal Reserve Agent at the Federal

ReBer" Bank of St. Louis, reading as follows:

"Reference your letter of December 24 inclosing copy ofletter of December 20 from Mr. Wirgman relating to voting per-mit application of 'Trustees Under Trust Agreement Dated Janu-ary 31, 1919, as Amended July 50, 1920, and January 26, 1923,With Reference to Stocks in The Citizens Union National Bankof Louisville and Fidelity and Columbia Trust Company, both ofLouisv ille, KentucXyt. Having authorized issuance of general',/°t1ng permit to applicant subject to standard conditions,_coard does not feel that it should grant limited permit en-

ing applicant to vote to elect directors and to act uponroutine matters at 1936 annual meeting of stockholders of itssubsidiary member bank. The tentative draft of the standardconditions to be prescribed by the Board in connection withthe granting of general voting permits was submitted to and

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"considered by the applicant some weeks ago. Board has con-sidered sir. Wirgman's letters dated November 30 and December20, as well as letters expressing views of other holding com-pany affiliates, and has decided that execution of agreementin form accompanying Board's letter X-9:385 is a minimum con-dition to granting of a general voting permit. Please adviseapplicant accordingly."

Approved unanimously.

Letter to Mr. Post, Assistant Federal Reserve Agent at the

Federal Reserve Bank of Philadelphia, reading as follows:

"This will acknowledge receipt of your letter of Decem-ber 11, 1935, inclosing a copy of an agreement executed bythe Farmers Bank of the State of Delaware as of June 4, 1935,together with an extract from the by-laws of that bank, evi-dencing the authority of its executive committee and a copyof an opinion by your counsel based on the submission of addi-tional information that the agreement has been properlyexecuted.

"We understand that with these documents counsel for yourbank is now of the opinion that the supplementary material ob-tained in connection with apparent omissions and irregulari-ties in agreements executed on F.R.E. Form T-1 by certain non-member banks in your district are now in satisfactory form.

"In addition to the Farmers Bank of the State of Delaware,the other banks referred to and as to which previous advice hasbeen received from you are The Altoona Trust Company, Altoona,Pennsylvania; The Real rstatc Trust Company of Philadelphia,

Philadelphia, Pennsylvania; Mitten Bank and Trust Company,Philadelphia, Pennsylvania; and The Reading Trust Company,Reading, Pennsylvania."

Approved unanimously.

Telegram to the governors of all Federal reserve banks, reading

" f°110ws:

"Referring Board's wire, TRANS 2342, of December 21 andYour bank's reply thereto Board has approved charge to currentexT)ense of liability of Federal Reserve banks for prior serviceaccount Retirement System over Period of five years based onmaturity value discounted at 2%, and your bank is authorized to

Vlarge current expenses for 1935 with additional amount due for4-95 and to charge one forty-eighth of unpaid balance as of

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"January 1, 1936 to current expenses each month from January,1936 to December 1939. Understand that Chairman of Retire-ment Committee has furnished you statement showing amount tobe charged in 1935 and subsequent years."

Approved unanimously.

Telegram to r. Sargent, Assistant Federal Reserve Agent at

4deral Reserve Bank of San Francisco, reading as follows:

"Referring your wires of December 27 and December 23Board authorizes your bank to set aside at end of yearadditional reserves on bank building as follows: SanFrancisco 1521723.25, Salt Lake City $15,352.98, LosAngeles $29,491.41, total $177,567.64."

the

Approved unanimously.

Telegram to Governor Schaller of the Federal Reserve Bank of

ellie go, reeding as follows:

"Referring your Decemter 27 letter, in addition to amountssPecified in Board's wire of December 28, your bank is author-ized at end of year to set aside a reserve of 4125,000 for pur-chase of air conditioning equipment and to set aside a reserveout of earnings on industrial advances of approximately V61000to cover probable loss on Oconomowoc loan. Board's wire ofPecember 28 authorized your bank to set aside a reserve of41,347,924 to cover prior service liability account Retirement8Yetem on January 1, 1936. Understand this will be full amountof bank's unpaid liability as of that date after charging anadditional 249,485 to current expenses at end of year."

Per

Approved unanimously.

Memorandum dated December 28, 1935, from Mr. Foulk, Fiscal Agent,

endinr that en assessment of six hundred five thousandths of one

eent (.00605) of

4"tort

be

rnonths of 1936,of

the total paid-in capital and surplus (Section 7 and

' Federal reserve banks as of the close of business December

levied to cover the expenses of the Board during the first

and approximately $1,000,000 to be applied to the cost

the Board's nev building; the latter amount to be paid by the banks atetleh timDertoos

and in such amounts as the Board may call during the six months

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The following resolution levying an assess-ment in accordance with the Fiscal Agent's recoll-mendation was approved unanimously:

"WHEREAS, Section 10 of the Federal Reserve Act, as amended,contains the following provisions:

'The Board of Governors of the Federal Reserve Systemshall have power to levy semiannually upon the Federal re-serve banks, in proportion to their capital stock and sur-plus, an assessment sufficient to pay its estimated expensesand the salaries of its members and employees for the halfyear succeeding the levying of such assessment, togetherwith any deficit carried forward from the preceding half year,and such assessments may include amounts sufficient to pro-vide for the acquisition by the Board in its orn name of suchsite or building in the District of Columbia as in its judg-ment alone shell be necessary for the purpose of providingsuitable and adequate quarters for the performance of itsfunctions. After approving such plans, estimates, andSpecifications as it shall have caused to be prepared, theBoard may, notwithstanding any other provision of law, cause tobe constructed on the site so acquired by it E buildingsuitable and adequate in its judgment for its purposes andproceed to take all such steps as it may deem necessary orappropriate in connection with the construction, equipment,and furnishing of such building. The Board may maintain,enlarge, or remodel any building so acquired or constructedan6 shall have sole control of such building and space there-in.

1* * * * * * * * * * * * * * * * * * * * * * * * *'The Board shall determine and prescribe the manner in

which its obligations shall be incurred and its disbursementsand expenses allowed and paid, and may leave on deposit inthe Federal reserve banks the proceeds of assessments leviedUpon them to defray its estimated expenses and the salariesof its members and employes, * * * * and funds derived fromSuch assessments hell not be construed to be Governmentfunds or appropriated moneys.'"WHEREAS, it appears from a consideration of the estimatedexn

, tenses of the Board of Governors of the Federal Reserve System2r the six months period beginning January 1, 1_936, and of thef°unts which in the judgment of the Board may be needed during;!ch period to provide for the costs, or part thereof, of the.nuizition of a site and erection of a building thereon suitable"Q adequate for the Board's quarters, that it is necessary that7 !Lind equal to six hundred five thousandths of one per centi‘.00605) of the total paid-in capital stock and surplus (Section7

and Section rib) of the Federal reserve banks be crested for

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"such purposes, exclusive of the cost of engraving and printingof Federal reserve notes;

"NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF GOVERNORSOF THE FITERAL RESFRVE SYSTEM, That:

(1) There is hereby levied upon the several Federal reservebanks an assessment in an amount equal to six hundred fivethousandths of one per cent (.00605) of the total paid-in capitaland surplus (Section 7 and Section 15b) of each such bank at theClose of business December 31, 1955.

(2) Twenty-tvo and three tenths per cent of such assessmentShall be paid in on January 21 1956, twenty-two and three tenthsPer cent thereof shall be paid in on March 21 1936, and theremainder (fifty-five and four tenths per cent) shall be paid atsuch times and in such amounts as the Board may call for the pay-ment thereof during such six months period beginning January 1,1936

(3) Every Federal reserve bank except the Federal ReserveBank of Richmond shall pay such assessment by transferring theaTount thereof on the dates as above provided through the Inter-strict Settlement Fund to the Federal Reserve Bank of Richmond

for credit to the account of the Board of Governors of the Fed-eral Reserve System on the books of that bank, with telegraphic!dvIce to Richmond of the purpose and amount of the credit, end

Federal Reserve Bank of Richmond shall pay its assessmentpoi crediting the amount thereof on its books to the Board ofuovernors of the Federal Reserve System on the dates as aboveProvided.

Draft of a contract to be entered into by the Board and the

Rechinger Engineering Corporationthe

temporary building No.

building at 20th and Constitution Lvenue, Northwest. The

l'icied for the

"it8 completion

4e1'; that, with the

1)el-fied as being not

salvaged from

I'l;oration; and that, prior

covering the demolition

5 now standing on the site for

and removal of

the Board's ner

contract pro-

commencement of the work of demolition on. January 2, 1956,

not later than March 1, 1936, unles:: extended by the

exception of certain material in the building,

properly a part of the real estate, all of the

the building would become the property of the

to the commencefient of the work of demolition,

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the corporation would pay to the Board a sum of 0.8,358. It was stated

that the corporation had agreed to execute and deliver the contract to

the Board today. It was also stated that there were certain temnorary

barricades to be constructed and temporary changes in steam and other

PiPes to be made pending the removal of the Trade Commission from a

Portion of the building which would cost about 400 and that this expense

isnot to be assumed by the corporation but is to be paid by the Board.

The contract was arproved unanimously, andMr. Morrill was authorized to execute it ascontracting officer for the Board, with the under—standing that the amount -paid by the HechingerEngineering Corporation would be credited to theBoard's building fund.

Memorandum dated December 30, 1935, frota Mx. Kremer, SuperintendentOf r

°nstruction for the Board's new building, recommending acceptance by

the Board of the bid of Grover H. Ashbrook in the amount of 0.26.00,

e°17er1ng certain carpentry work in connecticn with the demolition ofTerm,'°rarY Building No. 5, and of the bid of Allen, Mitchell & Co., in the

1°114 of v275.00, covering the necessary changes in plumbing and heating

8 in connection with the demolition of the building, all as outlined

ill the memorandum. The work referred to way made necessary by the

()cellPaneY of a portion of the building by the Federal Trade Commission

bet,rep-4 January 1 and January 15, 1936, as outlined in the Board's letter

or -_ce.Alber 24, 1935, to the Commission.

Thereupon the meeting adjourned.

•

0 Secretsry.

Chairmnn.

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