contracting party within the income taxable year, such amount to become the property of the United States, but the surety under such contracts shall not be liable for the payment of such excess profit: Provided, That if there is a net loss on all such contracts or subcontracts completed by the particular contractor or subcontractor within any income taxable year, such net loss shall be allowed as a credit in determining the excess profit, if any, for the next succeeding income taxable year: Provided further, That if such amount is not voluntarily paid the Secretary of the Treasury shall collect the same under the usual methods employed under the internal-revenue laws to collect Federal income taxes: Provided further, That all provisions of law (including penalties) applicable with respect to the taxes imposed by Title I of the Revenue Act of 1934, and not inconsistent with this section, shall be applicable with respect to the assessment, collection, or payment of excess profits to the Treasury as provided by this section, and to refunds by the Treasury of overpayments of excess profits into the Treasury: And provided further, That this section shall not apply to contracts or subcontracts for scientific equipment used for communication, target detection, navigation, and fire control as may be so designated by the Secretary of the Navy, and the Secretary of the Navy shall report annually to the Congress the names of such contractors and subcontractors affected by this provision, together with the applicable contracts and the amounts thereof: And provided further, That the income-taxable years shall be such taxable years beginning after December 31, 1935, except that the above provisos relating to the assessment, collection, payment, or refunding of excess profit to or by the Treasury shall be retroactive to March 27, 1934." Approved, June 25, 1936. (EXTRACT FROM) [PUBLIC-No. 528-75TH CONGRESS] [CHAPTER 243-3D SESSION] [H. R. 9218] AN ACT To establish the composition of the United States Navy, to authorize the construction of certain naval vessels, and for other purposes. SEC. 7. The allocation and contracts for construction of the vessels herein authorized and the replacement thereof, as well as for the procurement and construction of airplanes and spare parts, shall be in accordance with the terms and conditions provided by the Act of March 27, 1934 (48 Stat. 503), as amended. Approved, May 17, 1938. (EXTRACT FROM) [PUBLIC-No. 18-76TH CONGRESS] [H. R. 3791] AN ACT To provide more effectively for the national defense by carrying out the recommendations of the President in his message of January 12, 1939, to the Congress. SEC. 14. All the provisions of section 3 of the Act of March 27, 1934, as amended (48 Stat. 505; 49 Stat. 1926), and as amended by this section shall be applicable with respect to contracts for aircraft or any portion thereof for the Army to the same extent and in the same manner that such provisions are applicable with respect to contracts for aircraft, or any portion thereof for the Navy: Provided, That the Secretary of War shall exercise all functions under such section with respect to aircraft for the Army which are exercised by the Secretary of the Navy with respect to aircraft for the Navy: Provided further, That section 3 b of the Act of March 27, 1934 (48 Stat. 505), as amended (49 Stat. 1926; 34 U. S. C. Supp. IV 496), is hereby further amended by inserting in the first sentence after the words "in excess of 10 per centum of the total contract prices" the words "for the construction and or manufacture of any complete naval vessel or portion thereof, and in excess of 12 per centum of the total contract prices for the construction and or manufacture of any complete aircraft or portion thereof"; by inserting in the first proviso after the words "That if there is a net loss on all such contracts or subcontracts" the words "for the construction and or manufacture of any complete naval vessel or portion thereof"; and by inserting at the end of the first proviso after the words "income taxable year" a comma and the words "and that if there is a net loss, or a net profit less than 12 per centum, as aforesaid on all such contracts or subcontracts for the construction and or manufacture of any complete aircraft or portion thereof completed by the particular contractor or subcontractor within any income taxable year, such net loss or deficiency in profit shall be allowed as a credit in determining the excess profit, if any, during the next succeeding four income taxable years, and that the method of ascertaining the amount of excess profit, initially fixed upon shall be determined on or before June 30, 1939": Provided further, That when aircraft are procured by the Secretary of War as a result of competitive bids requiring the submission of sample aircraft with bid, the Secretary is authorized, in his discretion, to purchase sample aircraft of competitors to whom an award is not made, not more than one each from not more than three such competitors, in order of merit, at prices not exceeding 75, 60, and 50 per centum, respectively, of the cost applicable in the opinion of the Secretary to the development and manufacture of such sample aircraft. Approved, April 3, 1939. (EXTRACT FROM) [PUBLIC-No. 43-76TH CONGRESS] [H. R. 4278] AN ACT To authorize the Secretary of the Navy to proceed with the construction of certain public works, and for other purposes. SEC. 4. (a) To enable the Secretary of the Navy to accomplish without delay or excessive cost those public-works projects authorized by this Act to be located outside the continental limits of the United States, he is hereby authorized to enter into contracts upon a costplus-a-fixed-fee basis after such negotiations as he may authorize and approve and without advertising for proposals with reference thereto. Approval by the President shall be necessary to the validity of any contract entered into under authority of this section. The fixed fee to be paid the contractor as a result of any contract entered into under authority of this section shall be determined at or before the time such contract is made, and shall be set forth in such contract. Such fee shall not exceed 10 per centum of the estimated cost of the contract, exclusive of the fee, as determined by the Secretary of the Navy. Changes in the amount of the fee shall be made only upon material changes in the scope of the work concerned as determined by the Secretary of the Navy whose determination shall be conclusive. (b) Negotiations under this section shall be between the Secretary of the Navy, or a duly authorized representative, and three or more reputable and qualified contracting individuals, firms, or corporations regularly engaged in work of comparable magnitude and class to that contemplated by the negotiations, as determined by the Secretary of the Navy, and contracts may be made with any such individual, firm, or corporation, or with any two or more of them jointly, upon such terms and conditions as the Secretary of the Navy may determine to be fair and equitable and in the interests of the national defense. For each contract entered into under authority of this section the Secretary of the Navy may detail a naval officer to duty, without additional compensation, as an executive representative of the contracting officer. The contract shall provide that the officer so detailed shall have the right to attend any meetings of the board of directors or other executive or administrative board or committee of any corporation, partnership, firm, or syndicate which is or may become a party thereto for the purpose of submitting propositions, propounding questions, and receiving information relative to any matter within the purview of the contract with the intent and for the purpose of safeguarding the interests of the United States, coordinating efforts, and promoting mutually beneficial relationships, and making decisions within the scope of his delegated authority and not in conflict with any provision of the contract. (c) In any project the contract for which is negotiated under authority of this section, the Secretary of the Navy may waive the requirement of a performance and a payment bond and may accept materials required for any such project at such place or places as he may deem necessary to minimize insurance costs. (d) Any contract negotiated under this section may, in the discretion of the Secretary of the Navy, contain provisions under which any loss of or major damage to the plant, materials, or supplies of any contractor, not due to his negligence or fault or to the negligence or fault of his agents or servants, while the same is necessarily in transit upon or lying in the open sea for the purposes of the contract, will be investigated by a board of naval officers appointed for the purpose and reported to the Secretary of the Navy, who will transmit to the Congress the findings of fact and his recommendations in the premises. (e) The Secretary of the Navy shall report annually to the Congress all contracts entered into under authority of this section, including the names of the contractors and copies of the contracts concerned, together with the amounts thereof. Approved, April 25, 1939. [H. R. 8026] AN ACT To establish the composition of the United States Navy, to authorize the construction of certain naval vessels, and for other purposes. SEC. 6. The allocation and contracts for construction of the vessels herein authorized as well as the procurement and construction of airplanes and spare parts, shall be in accordance with the terms and conditions provided by the Act of March 27, 1934 (48 Stat. 503), as amended. SEC. 8. The construction, alteration, furnishing, or equipping of any naval vessel authorized by this Act, or the construction, alteration, furnishing, or equipping of any naval vessels with funds from any appropriation available for such purposes, contracts for which are made after June 30, 1940, shall be in accordance with the provisions of Public Law Numbered 846, Seventy-fourth Congress, approved June 30, 1936, unless such course, in the judgment of the President of the United States, should not be in the interest of national defense. SEC. 10. The provisions of section 4 of the Act approved April 25, 1939 (53 Stat. 590, 592), shall, during the period of any national emergency declared by the President to exist, be applicable to naval public works and naval public utilities projects in the Fourteenth Naval District for which appropriations are made or authorized: Provided, That the fixed fee to be paid the contractor as a result of any contract entered into under the authority contained herein, or any contract hereafter entered into under the authority contained in said Act of April 25, 1939, shall not exceed 6 per centum of the estimated cost of the contract, exclusive of the fee, as determined by the Secretary of the Navy. Approved, June 14, 1940. (48) |