GATES 

 947 



people unable 

 ipon their gen- 

 a realistic pro- 

 habilitation of 

 rming to the 



E FARM 



slation was en- 

 demands of an 

 )nsidering this 

 hat the many 

 or action have 

 )gram that was 

 sed by farmers. 

 :e a number of 

 low that many 

 n value to agri- 

 a result of this 

 ■ould be unwise 

 lasic legislation, 

 tudy to ways in 

 nts in our basic 

 de by modifica- 



ble to press for 



lanent basis of 



designed to pro- 



on by high level 



give careful 



modification of 



in to determine 



3on agriculture 



the nation as a 



better coordinated program is essential 

 if we are to turn the tide that is rapidly 

 carrying us toward national soil poverty. 



V. LABOR MANAGEMENT 

 RELATIONS 



For a number of years this association 

 urged the enactment of national legisla- 

 tion to correct abuses in labor manage- 

 ment relations and protect the public in- 

 terest. The 80th Congress enacted the 

 "Labor Management Relations Act, 

 1947" and this legislation now is in ef- 

 fect. The Illinois Agricultural Associa- 

 tion and the American Farm Bureau Fed- 

 eration vigorously supported this legisla- 

 tion. Its opponents urge that it be re- 

 f)ealed. We oppose any efforts to repeal 

 or weaken this legislation. We com- 

 mend the statesmanship of those members 

 of Congress from Illinois who supported 

 this legislation. 



VI. TAXATION OF FARMER 

 COOPERATIVES 



Farmer cooperatives are under vicious 

 and unwarranted attacks. It is alleged 

 that farmer cooperatives avoid their fair 

 share of the Federal tax burden. This 

 claim is a cover-up. The real motive of 

 these attacks is not to effect an equitable 

 tax adjustment or reform, but to destroy 

 farmer cooperatives. The position of the 

 Illinois Agricultural Association and its 

 affiliated cooperatives has heretofore been 

 clearly and emphatically stated. Because 

 of the bitterness of these attacks, how- 

 ever, the Association herewith restates its 

 position. 



It is sound fiscal policy for every farm- 

 er cooperative to have and maintain an 

 adequate capital structure. Such a struc- 

 ture permits the cooperative to distribute 

 periodically to its member patrons its 



RESOLUTIONS COMMITTEE 



F. E. Morris, Sangamon Coifnty, 

 Chairman; Dexter Norton, Kane; 

 Geo. Bark, DeKalb; Frank Buck- 

 man, Lee; Durham Lucas, Warren; 

 George Logan, Schuyler; Chas. 

 Holler, Peoria; N. O. Braden, Liv- 

 ingston; Harold Seedorf, Kanka- 

 kee; Frank L. Simpson, DeWitt; 

 Chester A. Thomason, Morgan; 

 Clarence Whitler, Macoupin; Geo. 

 L. Bauer, Bond; W. C. Buzzard, 

 Fayette; O. N. Stinson, Saline; 

 Peter D. Dillow, Union; R. V. Mc- 

 Kee, Marshall; E. T. Cuinan, Logan; 

 D. L. Clarke, Sangamon; J. King 

 Eaton, Madison; Lyman Bunting, 

 Edwards; Albert Webb, Franklin; 

 Burnell Henert, Lee, Rural Yputh 

 Representative. 



operational savings and earnings where 

 such income, in the hands of the recipi- 

 ent, can be subjected to the graduated 

 income tax rates applicable to individuals. 

 Certain farmer cooperatives operate as 

 income tax exempt corporations, while 

 other farmer cooperatives operate as non- 

 exempt corporations. Every farmer co- 

 operative operating as an income tax 

 exempt corporation is required to make 

 an annual informational return, setting 

 forth in detail its operations for the re- 

 spective fiscal year. If the return in- 

 clicates that such farmer cooperative is 

 operating within the limitations of law 

 and the regulations issued thereunder, no 

 duty exists on the part of such farmer 

 cooperative to pay an income tax. One 

 of the limitations provided by law is the 

 maintenance of only reasonable and nec- 



essary reserves. If such cooperative m- 

 sists on exceeding such "reasonable" and 

 "necessar)'" reserves, its right to exemp- 

 tion should be revoked. We will sup- 

 port any needed revision of law or reg- 

 ulation which will more dearly define 

 "reasonable" or "necessary" reserves. 



If on the other hand the farmer co- 

 operative is operating as a non-exempt 

 corporation, it is duty-bound to make a 

 tax return and pay income tax. 



That part of the income of any cor- 

 poration, whether it be a business cor- 

 poration or a cooperative, which is dis- 

 tributed to shareholders as dividends on 

 capital stock should not be subject to the 

 corporation income tax since such income 

 is taxable in the hands of the share- 

 holders. Double taxation is unjust and 

 obnoxious. All income under existing 

 law and regulations, if equitably distrib- 

 uted by any corporation as patronage re- 

 funds pursuant to a definite prior com- 

 mitment therefor, is not subject to the- 

 corporation income tax. We will vigor- 

 ously oppose and resist the application ot 

 an income tax upon any portion of the 

 income of a farmer cooperative which is 

 equitably and currently distributed to 

 members and patrons in the form of 

 patronage refunds. 



VII. COSTS OF DISTRIBUTION 



The cost of distribution of farm prod- 

 ucts is relatively inflexible. Over a pe- 

 riod of forty years the marketing, proc- 

 essing and distribution costs have grad- 

 ually increased. This trend has accen- 

 tuated the long-time disparity which has 

 existed between the prices of farm prod- 

 ucts and the prices of other commodities. 



These increased costs of distribution 

 are in part a result of the use of mo- 

 nopolistic restraints and practices by the 



tVATION 



id increased em- 

 the soil in all 

 re has been con- 

 ,oil conservation 

 Agencies, espe- 

 te levels. This 

 confusion and 

 nment soil con- 

 be combined 

 ;se levels. Re- 

 assigned to the 

 itutions — the 

 Educational and 

 ould be admin- 

 Service, which 

 do this work, 

 lot hamper the 

 y local soil con- 

 ire efficient and 



>4 



1 



Members of the lAA's resolutions committee are: first row, left to right, Dan I. Clarke, Sangamon county; Frank L. Simpson, DeWitt; 

 George Logan, Schuyler; F. E. Morris, Sangamon, chairman; P. D. Dillow, Union; Clarence Whitler, Macoupin; O. N. Stinson, Saline; Pawl 

 Mathias, lAA secretary. Second row, R. V. McKee, Marshall; Charles Holler, Peoria; C. A. Thomason, Morgan; J. King Eaton, Madison; 

 6. L. Bauer, Bond; Lyman Bunting, Edwards; George Bark, DeKalb; Frank Buchman, Lee; Albert Webb, Franklin; N. O. Braden, Livings- 

 ton, and E. T. Cuinan, Logan. Not present when picture was tokenwere: Dexter Norton, Kane; Durham Lucas, Warren; Harold Seedorf, 

 Kankakee; W. C. Buzzard, Fayette; and Burnell Henert, Rural Youth representative from Lee county. 



A. RECORD 



i 



JANUARY, 1948 



17 



