Veto of Bill "To Incorporate the Youth Councils on Civic Affairs, and for Other Purposes."

To the House of Representatives:

I return herewith, without my approval, H.R. 3329, a bill "To incorporate the Youth Councils on Civic Affairs, and for other purposes."

The Committee reports indicate that this organization had its origin in Jacksonville, Florida, in 1962 and that it was incorporated under Florida law in March 1963. Its general purposes are to promote youth activities for the good of the community and to make youth aware of their civic responsibilities. Obviously, these worthwhile purposes are not the basis of my concern with this bill.

For some time I have been concerned with the question of whether we were granting Federal charters to private organizations on a case-by-case basis without the benefit of clearly established standards and criteria as to eligibility. Worthy civic, patriotic, and philanthropic organizations can and do incorporate their activities under State law. It seems obvious that Federal charters should be granted, if at all, only on a selective basis and that they should meet some national interest standard.

Other questions indicate the desirability of further study of this matter. For example, does the granting of Federal charters to a limited number of organizations discriminate against similar and worthy organizations and possibly stifle their growth? Should federally chartered corporations be more carefully supervised by an agency of the Federal Government? Does Federal rather than State chartering result in differences in the legal or tax status of the corporation, and are any differences appropriate ones ?

I note that last year Congress enacted Public Law 88-504, at the recommendation of the General Accounting Office, to provide common standards of auditing and reporting for federally chartered corporations covered by Title 36 of the United States Code. This reflected a concern similar to mine that proper standards and criteria be established in this area.

I hope that the Judiciary Committees will find it possible to make a comprehensive study of the questions I have outlined above. I am asking the Department of Justice and the Bureau of the Budget to explore these questions also and to make appropriate recommendations to me.

In the light of these concerns and without reflection in any way on the worthy purposes of the organization which would be incorporated by this bill, I feel constrained to withhold my approval from H.R. 3329 at this time.

LYNDON B. JOHNSON

The White House

September 10, 1965