The departments and agencies concerned with the admininstration of Public Resolution 17 have relied upon Attorney General Cummings' opinion for more than thirty years. On the basis of that opinion, the Maritime Administration has for many years granted "waivers" to recipient countries to permit them to carry up to 50 percent of the cargo in their own ships. The granting of waivers has been conditioned upon the adoption or continuance of nondiscriminatory shipping practices by the recipient countries and is thought to benefit the American merchant marine generally through the resulting elimination of discriminatory shipping practices by other countries.1

At recent meetings of the Grievance Committee on Cargo Preference Administration, a joint government-industry group of which the Maritime Administrator is chairman,2 some of the advisers to the Committee have protested that the waiver practice is neither beneficial to the American merchant marine nor legally authorized. Other advisers have defended both the wisdom and the legality of the practice. Your General Counsel has informed you that the practice is lawful, but because of the importance of the matter the question has been referred to me for an opinion.

I conclude that Public Resolution 17 does not impose a mandatory requirement and is therefore not violated by the granting of waivers. That conclusion is required not only by the language of the resolution but also by the weight to be given to Attorney General Cummings' opinion and the longstanding administrative practice derived from it.

1 The policies followed by the Maritime Administration in granting waivers and the objects sought to be achieved by the policies are set out in the following documents, copies of which have been furnished to me: Letter dated September 25, 1945, from Admiral E. S. Land, Chairman, United States Maritime Commission, to Mr. Wayne C. Taylor, President, Export-Import Bank of Washington; Maritime Administrator, Office of Ship Operations, "Administration of Public Resolution 17, 73d Congress," November 25, 1958; and Maritime Administration, "Statement of Policy on Public Resolution 17, 73d Congress," July 24, 1959.

2 I have been advised that this Committee was formed in the Spring of 1964 by the joint action of the Secretaries of Labor and Commerce; that it is composed of the Maritime Administrator and Assistant Secretaries of State, Agriculture, and Labor, and that it has as advisers representatives from the National Maritime Union, the Seafarers' International Union, the International Longshoremen's Association, the American Maritime Association, the American Merchant Marine Institute, and the Pacific American Steamship

Association.

A resolution expressing "the sense of Congress" is literally a statement of opinion and not a command; it expresses Congress' judgment of the policies which it believes ought to be followed but which, for various reasons, it does not wish to make mandatory. Had Congress wanted to impose a mandatory requirement that government-financed exports 3 be shipped exclusively in American ships, it could readily have done so by adopting a statute in the usual form. In adopting instead only a resolution expressing "the sense of Congress,' Congress presumably made a deliberate choice not to make compliance with the policy mandatory and to leave to the executive branch the ultimate judgment whether, under the particular circumstances existing from time to time, some modification of the policy would better serve the interests of the American merchant marine. While the use of the word "shall" rather than "should" in the body of the resolution may carry a contrary implication, imprecise use of "shall" is not uncommon and is hardly sufficient to overcome the significance of the explicit limitation of the resolution to an expression only of the "sense of Congress.'

Even if the question were more doubtful as an original matter, I would nevertheless adhere to the opinion rendered by Attorney General Cummings. That opinion has been outstanding for over thirty years, and the waiver policy developed in reliance on it has had a significant impact on

8 No question has been presented to me as to what kinds of financing arrangements constitute "loans" within the meaning of Public Resolution 17, and I accordingly express no opinion on that question.

+ Compare 42 Op. A.G. 229, ruling that a declaration of the "policy of Congress" (§ 2(c), Agricultural Act of 1961, P.L. 87-128, 75 Stat. 294, 7 U.S.C. 1282 note), was not intended to have binding legal effect but was merely to be given consideration by the executive branch in making its decisions. The legislative history of that act indicated that the phrase "policy of Congress" was intended to be synonymous with "sense of Congress." 107 Cong. Rec. 13746.

5 The legislative history, although sparse, tends to confirm the hortatory nature of the resolution. The resolution originated in the House Committee on Merchant Marine, Radio, and Fisheries. In the House debates, Congressman Bland explained that the committee had originally adopted "a committee resolution which we sent to the Reconstruction Finance Corporation expressing the wish of the committee that the Reconstruction Finance Corporation should use its agencies and powers to secure shipment in American bottoms" and that it was later proposed to introduce a congressional resolution because "the members of the committee thought it would be an opportune time to express the sense of Congress that these shipments should go in American vessels." 77 Cong. Rec. 6163, 6164. The comments in the Senate debates went only to the substance of the policy to be expressed and shed little light on the intended force of the resolution. See 78 Cong. Rec. 3398.

worldwide shipping practices. The consistent practice of the Attorneys General has been not to reexamine questions definitively answered by their predecessors, at least unless exceptional circumstances are present or it is demonstrated that the earlier ruling was clearly erroneous. In addition, the interpretation of Public Resolution 17 as not imposing a mandatory requirement has in effect been ratified by Congress. The waiver practice was brought to the attention of Congress during the hearings which led to the enactment of the Cargo Preference Act of August 26, 1954, c. 936, 68 Stat. 832, 46 U.S.C. 1241 (b). That act, in turn, included a specific proviso that "Nothing herein shall repeal or otherwise modify the provisions of Public Resolution Numbered 17, Seventythird Congress (48 Stat. 500) as amended." The adoption of that proviso with full knowledge of the administrative practice amounts to a congressional ratification of the longstanding interpretation of the resolution as not being mandatory. See Boesche v. Udall, 373 U.S. 472, 483 (1963); Power Reactor Co. v. Electricians, 367 U.S. 396, 409 (1961); Ivanhoe Irrigation District v. McCracken, 357 U.S. 275, 293–294 (1958).

For the foregoing reasons, I adhere to the interpretation of Public Resolution 17 adopted in the opinion of Attorney General Cummings dated June 5, 1934, and conclude that the resolution does not impose a mandatory requirement. Sincerely,

NICHOLAS DEB. KATZENBACH.

621 Op. A.G. 23, 24; id. 264, 266; 24 Op. 53, 55; 27 Op. 520, 529.

▾ Cargo Preference Bill, Hearings before a Subcommittee of the Senate Committee on Interstate and Foreign Commerce on S. 3233, 83d Cong., 2d sess., pp. 101-102, 134-135; Waterborne Cargoes in United States-Flag Vessels, Hearings before the House Committee on Merchant Marine and Fisheries on S. 3233, 83d Cong., 2d sess., pp. 93–94. For a more recent instance of congressional awareness of this administrative practice, see S. Rept. 871, 88th Cong., 2d sess., pp. 6, 29–31.

BONDS OR NOTES ISSUED BY LOCAL URBAN RENEWAL OR PUBLIC HOUSING AGENCIES

The obligation of the United States under a contract or requisition agreement that secures bonds or notes issued by a local urban renewal or public housing agency is fully binding under section 302 of the Housing Act of 1961 (75 Stat. 166, 42 U.S.C. 1421a (c), 1452 (c)) even if litigation attacking the authority of the agency or the validity of the bonds or notes is pending at the time of issue. Nothing in the Department of Housing and Urban Development Act (Public Law 89-174, September 9, 1965, 79 Stat. 667) requires a different conclusion.

THE PRESIDENT.

NOVEMBER 2, 1965.

MY DEAR MR. PRESIDENT: I have the honor to comply with your request for my opinion upon the question submitted by the Administrator of the Housing and Home Finance Agency relative to section 302 of the Housing Act of 1961.1 The two subsections of that section provide that bonds and notes approved by the Government for sale to investors by local entities authorized to undertake or engage in the development or administration of urban renewal or public housing projects are incontestable in the hands of the bearer. The subsections, in addition, pledge the "full faith and credit of the United States" to the security of such approved bonds or notes.

The question of the Administrator is whether the directives of section 302 as to incontestability and its pledges of full faith and credit are effective to make the United States liable on the bonds or notes to which they apply, despite preexisting litigation or any other circumstance that may cast doubt on the validity or security of such obligations or challenge the authority of the issuer to proceed with the project being financed.

1 June 30, 1961, Public Law 87-70, 75 Stat. 166, 42 U.S.C. 1421a (c), 1452 (c).

I

Alternate means of financing for local projects are authorized in both the urban renewal and public housing programs. Local agencies may borrow funds from the United States at a rate of interest equal to or somewhat greater than the contemporaneous average yield of certain outstanding Government bonds.2 They also have the option, mentioned above, of borrowing funds from other sources with the approval of the Government, in which case the instruments of indebtedness are secured by contracts or requisition agreements with the Government to assure that Federal funds will be available if needed to make payments of principal and interest. You were informed by the Administrator in his request to you for this opinion that each such instrument issued to an investor bears a payment agreement affixed on behalf of the Government in accordance with section 302 of the Housing Act of 1961. The Administrator stated, in addition: "By the terms of this section these payment agreements are incontestable in the hands of a bearer and the full faith and credit of the United States is pledged to their payment. For this reason, as well as the fact that they are fully tax exempt because issued by local public agencies, these notes and bonds bear interest rates which are substantially less than those borne by Government notes and bonds and considerably less than the rates which under the applicable statutes must be charged for Federal loans to the local agencies. The low interest costs inure to the benefit of the respective programs and decrease the costs of Federal assistance. Additionally, this use of private financing eliminates the need for program financing through the Treasury Department and consequent increased Treasury borrowing.

"Due to the general practice in the municipal bond market requiring presentation of no-litigation certificates at

*Sections 102 and 110(g), Housing Act of 1949, July 15, 1949, c. 338, 63 Stat. 414, 421, as amended, 42 U.S.C. 1452, 1460(g); sections 2(10) and 9, United States Housing Act of 1937, September 1, 1937, c. 896, 50 Stat. 888, 891, as amended, 42 U.S.C. 1402(10), 1409.

8 Section 102(c), Housing Act of 1949, 63 Stat. 414, as amended, 42 U.S.C. 1452 (c); section 22, United States Housing Act of 1937, as added by section 304 (b) of the Housing Act of 1949, 63 Stat. 424, 42 U.S.C. 1421a (see also section 10 of the 1937 Act, 42 U.S.C. 1410).