PRIA, Government Policy, Made Personal

Summary

The Treasury must keep a sinking fund to pay off, buy back, or redeem bonds and notes issued under this chapter. Money in the fund is used when bonds come due or when the Treasury Secretary buys them early. The fund stays open until all those bonds and notes are retired. Each year the law provides three amounts: the interest that would have been payable that year on bonds already retired with the fund; 2.5 percent of the Liberty and Victory bonds outstanding on July 1, 1920, minus foreign government obligations the U.S. held then; and 2.5 percent of amounts spent after June 29, 1933 under sections 301 and 302 of the Emergency Relief and Construction Act of 1932. The Treasury Secretary sets the prices and terms for buying or redeeming. Bonds bought or redeemed from the fund must be canceled, retired, not reissued, and the average price paid may not be more than par value plus accrued interest.

Title 31, §3112

Money and Finance, Source: USLM XML via OLRC

(a)The Department of the Treasury has a sinking fund for retiring bonds and notes issued under this chapter. Amounts in the fund are appropriated for payment of bonds and notes at maturity or for their redemption or purchase before maturity by the Secretary of the Treasury. The fund is available until all the bonds and notes are retired.

(b)For each fiscal year, an amount is appropriated equal to—

(1)the interest that would have been payable during the fiscal year for which the appropriation is made on the bonds and notes bought, redeemed, or paid out of the fund during that or prior years;

(2)2.5 percent of the total amount of bonds and notes issued under the First Liberty Bond Act, the Second Liberty Bond Act, the Third Liberty Bond Act, the Fourth Liberty Bond Act, and the Victory Liberty Loan Act and outstanding on July 1, 1920, less an amount equal to the par amount of obligations of governments of foreign countries that the United States Government held on July 1, 1920; and

(3)2.5 percent of the total amount expended after June 29, 1933, from appropriations made or authorized in section 301 and 302 of the Emergency Relief and Construction Act of 1932.

(c)The Secretary may prescribe the price and conditions for paying, redeeming, and buying bonds and notes under this section. The average cost of bonds and notes bought under this section may not be more than par value and accrued interest. Bonds and notes bought, redeemed, or paid out of the sinking fund must be canceled and retired and may not be reissued.

Notes & Related Subsidiaries

Historical and Revision Notes

Revised SectionSource (U.S. Code)Source (Statutes at Large) 3112(a)31:767(less 2d sentence related to price, terms, and conditions, 3d, 4th sentences).Mar. 3, 1919, ch. 100, § 6, 40 Stat. 1311; Mar. 2, 1923, ch. 179, 42 Stat. 1427; May 29, 1928, ch. 901, § 1(21), 45 Stat. 987; Jan. 30, 1934, ch. 6, § 14(b), 48 Stat. 344. 3112(b)31:767(last sentence). 31:767b.Mar. 3, 1933, ch. 212, § 1(last par. on p. 1492), 47 Stat. 1492; Mar. 15, 1934, ch. 70, § 1(2d complete par. on p. 428), 48 Stat. 428. 3112(c)31:767(2d sentence related to price, terms, and conditions, 3d, 4th sentences). In subsection (a), the word “cumulative” is omitted as surplus. The words “under this chapter” are substituted for “under the First Liberty Bond Act, the Second Liberty Bond Act, the Third Liberty Bond Act, the Fourth Liberty Bond Act, or under this Act, and outstanding on July 1, 1920, and of bonds and notes thereafter issued, under any of such Acts or under any of such Acts as amended” to eliminate unnecessary words, reference to laws that have been executed, and to reflect consolidation of the public debt authority in the revised chapter. The words “and all additions thereto” are omitted as surplus. Subsection (b)(1) and (2) is substituted for 31:767(last sentence) to eliminate unnecessary words. In subsection (b)(3), the text of 31:767b(related to 31:767a) is omitted as obsolete. In subsection (c), the word “conditions” is substituted for “terms and conditions” because it is inclusive.

Editorial Notes

References in Text

The First Liberty Bond Act, referred to in subsec. (b)(2), is act Apr. 24, 1917, ch. 4, 40 Stat. 35, which enacted section 746, 755, 755a, 759, 764, 774, and 804 of former Title 31 and section 462a of Title 12, Banks and Banking, and amended section 745 and 768 of former Title 31, and was repealed by Pub. L. 97–258, § 5(b), Sept. 13, 1982, 96 Stat. 1072. The Second Liberty Bond Act, referred to in subsec. (b)(2), is act Sept. 24, 1917, ch. 56, 40 Stat. 288, which enacted section 747, 752 to 754b, 757, 757b, 757c to 757e, 758, 760, 765, 766, 771, 773, and 801 and amended section 745, 764, 769, and 774 of former Title 31, and was repealed by Pub. L. 97–258, § 5(b), Sept. 13, 1982, 96 Stat. 1072. The Third Liberty Bond Act, referred to in subsec. (b)(2), is act Apr. 4, 1918, ch. 44, 40 Stat. 502, which enacted section 765, 766, and 774 and amended section 752, 752a, 754, and 771 of former Title 31, and was repealed by Pub. L. 97–258, § 5(b), Sept. 13, 1982, 96 Stat. 1072. The Fourth Liberty Bond Act, referred to in subsec. (b)(2), is act July 9, 1918, ch. 142, 40 Stat. 844, which enacted section 750 and 772 and amended section 752 and 774 of former Title 31, and was repealed by Pub. L. 97–258, § 5(b), Sept. 13, 1982, 96 Stat. 1072. The Victory Liberty Loan Act, referred to in subsec. (b)(2), is act Mar. 3, 1919, ch. 100, 40 Stat. 1309, which enacted section 749, 753, 763, 767, 802, and 803 and amended section 750, 754, and 774 of former Title 31 and section 343 of Title 15, Commerce and Trade, and was repealed by Pub. L. 97–258, § 5(b), Sept. 13, 1982, 96 Stat. 1072. section 301 and 302 of the Emergency Relief and

Construction

Act of 1932, referred to in subsec. (b)(3), are section 301 and 302 of act July 21, 1932, ch. 520, 47 Stat. 709, which are not classified to the Code.

§3112 Sinking Fund for Retiring and Cancelling Bonds and Notes