TO ENCOURAGE THE DEVELOPMENT OF THE AGRI-
CULTURAL RESOURCES OF THE UNITED STATES
HEARINGS
BEFORE THE
COMMITTEE ON
IRRIGATION OF ARID LANDS
HOUSE OF REPRESENTATIVES
SIXTY-SEVENTH CONGRESS
FIRST SESSION
ON
HL R. 2913
By Mr. SMITH, of Idaho
A BILL TO ENCOURAGE THE DEVELOPMENT OF THE AGRI-
CULTURAL RESOURCES OF THE UNITED STATES THROUGH
FEDERAL AND STATE COOPERATION, GIVING PREFERENCE
IN THE MATTER OF EMPLOYMENT AND THE ESTABLISHMENT
OF RURAL HOMES TO THOSE WHO HAVE SERVED WITH THE
MILITARY AND NAVAL FORCES OF THE UNITED STATES
\
MAY 20, 23, 25, 26, AXD JUNE 2, 1921
California
Regional
acility
WASHINGTON
GOVERNMKN'JL- 1'HIXTIXG OFFICH
1921
r
COMMITTEE OX IRRIGATION OF ARID LANDS.
SIXTY-SEVENTH CONGRESS,
FIRST SESSION.
M. P. KINKAID, Nebraska, CJiairman.
NICHOLAS J. SIXXOTT, Oregon. CARL HAYDEN, Arizona.
EDWARD C. LITTLE, Kansas. C. B. HUDSPETH' Texas.
ADDISOX T. SMITH, Idaho. JOHX E. RAKER, California.
JOHX W. SUMMERS, Washington. HOMER L- LYON, North Carolina.
HEXRY E. BARBOUR, California. WILLIAM B. BANKHEAD, Alabama.
E. O. LEATHERWOOD, Utah.
WILLIAM WILLIAMSOX, South Dakota.
SAMUEL S. AREXTZ, Xevada.
MAXUEL HERRICK, Oklahoma.
A. R. HUMPHREY. Ckrk.
2
TO ENCOURAGE THE DEVELOPMENT OF THE AGRICULTURAL
RESOURCES OF THE UNITED STATES.
COMMITTEE ox IRRIGATION OF ARID LANDS.
HOUSE OF REPRESENTATIVES,
Friday, May 20, 1921.
The committee met at 10.30 o'clock a. m., Hon. M. P. Kinkaid
(chairman) presiding.
There were present before the committee: Hon. Thomas E.
Campbell, governor of Arizona; Hon. Louis F. Hart, governor of
Washington; Hon. Emmet D. Boyle, governor of Nevada; Hon. Charles
R. Mabey, governor of L'tah; Hon. D. W. Davis, governor of Idaho;
Mr. Del ph. E. Carpenter, representing Gov. Shoup, of Colorado;
Mr. Davis, representing Gov. Mechem. of Ne\v Mexico; Mr. Dobson,
secretary of the Chamber of Commerce, Portland, Oreg.; Mr. Frank
W. Brown, of Idaho, secretary Western States Reclamation Associa-
tion: Mr. Victor E. Keyes, attorney general of Colorado; Mr. Brimmer,
representing Gov. Carey, of Wyoming; William R. King; E. F. Blaine;
Mr. Sims Ely, secretary Arizona resource board.
The CHAIRMAN. The "committee will come to order. Gentlemen of
the committee, you have been informed that we have met this
morning to hear the governors of the Western States in behalf of
reclamation, and we will first hear Gov. Davis, of Idaho.
The committee desires to hear you, Governor, in behalf of reclama-
tion, what your proposition is. 1 will say that the chairman of the
committee at any rate is not advised specifically whether you want
to address yourselves to the Smith bill here or speak in general of
the subject of irrigation. But I suppose you want to direct your-
selves to that bill more or less, No. 2913. "At any rate we wilfhear
you now on whatever line you wish to talk.
STATEMENT OF HON. D. W. DAVIS, GOVERNOR OF
IDAHO.
Gov. DAVIS. Mr. Chairman and members of the committee, it was
not my thought to discuss the irrigation bill in detail, its features,
more than to say first, I would like to have the record show the
governors that are present from the Western States. They are not
all in the room, but they intend to be here.
We have with us Gov'. Campbell, of Arizona; Gov. Hart, of Wash-
ington; Gov. Boyle, of Nevada; Gov. Mabey, of L'tah: and myself;
and then we have representatives of governors of the other States;
Judge Carpenter, representing Gov. Shoup, of Colorado: and Mr.
Davis, State senator, representing Gov. Mechem, of Now Mexico:
Mr. Brimmer, representing Gov. Carey, of Wyoming.
It is our desire. Mr. Chairman, to come here and give the committee
what information they might want from the Western States, to show
the committee that we of the Western States are united in asking
4 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
that Congress give us some general policy in the matter of reclama-
tionadopt a policy by the Government that might go on for con-
siderable time and not make it necessary for us to come to Washing-
ton in the interest of individual projects, as has been the custom in
the past. We believe that it would be far better if we would adopt
a stated, definite policy whereby appropriations could be made,
to be paid in installments and made continuing. We are not ask-
ing the Government to give this money: we expect to pay it back,
every dollar of it, plus interest.
While there is an era of depression at the present time which might
be made as an argument that this is not an opportune time, we take
the position that it is an opportune time to prepare for this work
and to be in shape to carry it on. It takes years to bring reclamation
projects into bearing in full, and one reaction usually follows another
and we feel that by the time this work could be set in motion there
will be a tremendous Demand for the products of the farm. The
records in the Department of Agriculture would sustain that point.
It shows that we must keep pace and bring it new land for develop-
ment if we are to meet the needs of the Nation. We have a number
of men here this morning, and it is possible that the committee would
like to ask questions concerning these matters, and no doubt some
member of our delegation would be pleased to answer these questions.
I do not desire to take up a great deal of your time here by a lengthy
discussion of this subject, because I understand that your time is
limited to hear the different men.
The CHAIRMAN. Let me ask just aquestion there. You are not
here in behalf of any particular Dill ?
Gov. DAVIS. I want to say this, Mr. Chairman, that we governors
met in Denver, and several of the governors that are represented by
representatives here in this delegation were there in person, and we
unanimously recommended the Smith-McXary bill, and passed reso-
lutions to that effect, a copy of which will be left with your committee.
The CHAIRMAN. I have read of that, and that was why I mentioned
the Smith bill.
Gov. DAVIS. We have a copy of that resolution and it will be left
with your committee.
Mr. RAKER. Governor, before you take your seat, does that bill
rather meet the general viewpoint of the western governors as to
the future policy of the Reclamation Service (
Gov. DAVIS. Yes, sir; that was discussed at some length at Denver,
and it was decided that some such plan as is set forth in the Smith-
McXary bill was the plan which should be developed.
Mr. SINNOTT. Governor, have you decided upon the manner of the
presentation of what you wish to present to the committee \ If
you have not, I make this inquiry for this reason : Most of the mem-
bers of this committee I think all are very familiar with the merits
of irrigation, and you might save considerable time by avoiding a lot
of discussion of it and getting into the meat of the bill, or the exact
precise legislation desired, and any criticisms that you wish to make
or suggestions or amendments to any pending legislation would save
your time and our time, too.
Gov. DAVIS. That was my thought in being verv brief this morning,
Mr. Sinnott. I do not care to' go into any lengthy discussion of the
merits of irrigation. We have members of our association who have
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 5
been making a study of the bill, that can discuss it point by point,
perhaps better than I. and I think that has been done. Mr. Blaine
has appeared before your committee, I understand, and has oriven
you in detail a discussion of the various points of the bill.
Mr. RAKER. My idea in asking the governor was in line with the
suggestion of the gentleman from Oregon, Mr. Sinnott, that one of
these gentlemen who has given this bill thought and consideration
and has the general idea as to the policy, if they will take that bill
up and define it and analyze it clear on down through, stating what it
means and what they intend by it, I think it would not only benefit
the committee but it would give us an opportunity to get the matter
before the rest of the Members of the House, and that was what I
hoped the governor and his associate governors and representa-
tives would do before the committee this morning.
Gov. DAVIS. Well, now, Mr. Raker, as a member of the committee
is going to do that, and as Mr. Blaine. a member of the Western
States Association, representing the Western States, is here in Wash-
ington and will be able to discuss the matter in detail better than I,
I think I should leave that question for him.
Mr. SMITH. Mr. Chairman, the reason for the governors being
here at this particular time is to endeavor to impress upon the Con-
gress and upon the Secretary of the Interior and the President of
the United States the necessity of increasing the reclamation fund
in order that the reclamation work may be carried on more rapidly.
It was not the intention. I understand, to have the governors go into
detail with reference to the character of the legislation, but rather
to simply show by their presence here and what they may say of
their deep interest, and the deep interest of the people of the entire
western country in expanding this reclamation policy. Mr. Blaine,
who has been ^representing the Western States Reclamation Asso-
ciation here, has given more study to the details of this bill prob-
ably than any other person, so when the tune arrives to go into the
details of the bill I suggest that Mr. Blaine be called, but it seems
to me that each of the governors who are here and those who may
come in before we adjourn should, as Gov. Davis has done, make a
brief statement of their deep interest in the reclamation work and
the great importance to the western people and the people of the
entire country of bringing into cultivation more of these waste
lands, not only that the food supply may be increased but that we
may be able to furnish lands for the returned service men who are
anxious to take up agricultural pursuits.
The CHAIRMAN. As I understand you, governor, and as I under-
stand Mr. Smith, you are here to advance the cause of irrigation,
broadly speaking, and some of the members, Mr. Blaine, lor in-
stance, who has given the drafting of the bill the most attention,
perhaps, of anyone, will discuss the details of it to us.
Xow I want to ask one other question while it is opportune and
it will be sure to arise. As far as I am concerned. I stand for the
advancement of the cause of irrigation regardless of what bill may be
deemed to contain the best provisions for the cause. I want to ask
here we will have to meet that question whether the convention
at Denver considered the several bills that have been heretofore
introduced in the last Congress, say, for instance, particularly the
Smoot bill, which was Senate bill 3477, Sixty-sixth Congress, I have
6 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
introduced that bill substantially, with some amendments that our
committee made in the last Congress to the Smoot bill. I introduced
it again in this Congress and I wish to know now whether your con-
vention at Denver gave attention to the Smoot bill which was pending
in the last Congress. 3477.
Mr. HUDSPETH. Is that the bill that passed the Senate?
The CHAIRMAN. That is the bill that passed the Senate, which we
had up in the House and did not get through the House.
Did you consider that and reach the conclusion that you preferred
something like the Smith bill {
Gov. DAVIS. Just in a general way. Mr. Chairman, the various bills
before Congress were mentioned, discussed in a limited way. but the
sense of the committee meeting at Denver was that something along
the line of the Smith-McXary bill was more suited to reclamation of
the West than any other bill that we had taken up.
Mr. SMITH. These bills are not antagonistic in any way at all.
One provides for private capital in developing land; the other provides
for Federal aid.
The CHAIRMAN. Do any other members of the committee wish to
ask the governor a question i
Mr. RAKER. Right in that connection, the matter that is pending
primarily before the committee, and what the governors are interested
in as I understand it. and the representatives of the governors of the
Western States, is that the Government take hold through some well-
defined, proper policy, to protect the Government, to lend assistance
in a material way for the development of this arid and semiarid land.
Gov. DAVIS. Yes; irrigation has outgrown the ordinary private
individual or small company. The irrigation of the future is to be
done on a large scale, and It takes more capital than the average
company can assemble, and that is what the West is asking for now,
that the Government give us whatever aid it can, either by some
form of guarantee of bonds, or through the Federal Farm Loan
Board handle these bonds in some wav until such time as the project
itself is of sufficient value that they become attractive and market-
able.
Mr. RAKER. That being true, the suggestion made by the chairman
as to the bill known as the Smoot-Kinkaid bill
The CHAIRMAN (interposing). Xo: not the Kinkaid bill at all.
Mr. RAKER. Well. I believe in giving credit where credit is due,
judge.
The CHAIRMAN. Xo: that was not my bill.
Mr. RAKER. Well, call it the Smoot bill. That is a method whereby
large tracts through private capital can be developed and would
not interfere with the general policy of the public reclamation.
Gov. DAVIS. I did not understand you there.
Mr. RAKER. I say the bill that the chairman refers to would not
in any way interfere with the policy established by the Government
and to be carried on by virtue of governmental assistance, where
people have large tracts of land and desire to let the Government
operate it. if they spend money, the private individuals, so that it
would not interfere with what you people stand for.
Gov. DAVIS. ()a. no: indeed. I want to say this, as far as I am
personally concerae 1. an:l I think that is tru? of all of the rest of the
representatives here, that anyone desiring to enter into a private
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 7
reclamation project out there should be permitted to do so. I
don't think that they should be excluded by any means.
Mr. RAKER. In other words, they are not antagonistic?
Gov. DAVIS. Xot at all.
Mr. RAKER. Let me ask one question and then I am through and
it is a vital question before the committee, to my mind, on reclama-
tion. I want to ask if your committee has given thought to the
question of the first lien of the Government, whereby that could
be avoided and the district, each of these projects form districts
whereby the district, the land of the district, would be responsible
for the taxes to the end that the farmers might obtain the benefit
of the farm loan act. Has your committee of governors given any
thought to that ?
Gov. DAVIS. Yes; we have given considerable thought to that.
Mr. Elaine has a statement prepared something along that line.
He has gone into it at some length. Of course those are details that
must be worked out. and how best to work them out. of course, that
is a matter to come up in the future.
The CHAIRMAN. If you have nothing further now, Judge Raker, I
would like to ask one question upon which I think the opinion of the
organization of governors would be helpful very helpful in the
House and in the Senate.
Mr. SIXXOTT. We might get before the committee, concerning
Judge Raker's comment, that this bill, H. R. 2913, provides for the
inauguration of projects through a State district or minor subdi-
vision that would bring it right within the ruling of the Federal
farm loan act where they make loans to irrigation districts.
The CHAIRMAN. Yes. I will ask you this question, Governor,
whether it is the view of your governors' organization for the ad-
vancement of reclamation that the development, the taking up and
development of projects, can a great deal better be conducted under
the auspices of the Government, specifically the Secretary of the
Interior, the advantages being the standing it would give 'the pro-
i that the projects could be financed either by the landowners,
the water users themselves, independently of Government responsi-
bility for the financing, or through some qualified aid by the Govern-
ment in financing, whether it is not a very great advantage to have
the projects initiated and developed by the Government initiated
and developed by the Secretary of the Interior ?
Gov. DAVIS. I think that is very desirable; yes, sir. We discussed
that at considerable length.
That was the very object of this Western State Reclamation
Association to unite the West in cooperating with the Government
and ask the Government to do the very thing that you speak of now.
The CHAJRMAX. Yes; and let the Government have supervision
as far as practicable.
Gov. DAVIS. Yes, sir; give it that stability that it would get from
the Government being benind it.
Mr. LYOX. Would there be any objection on the part of the Gov-
ernment, if it could be done, that the bill finally decided on would
carry a provision for -the reclamation by drainage of swamp lands, as
well as the irrigation of arid lands, under the same terms and condi-
tions ?
8 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Gov. DAVIS. I understand that the subject of general reclamation
has always had in mind drainage and clearing of stump lands and
putting water on arid lands.
Mr. LYOX. I ask that question because I come from a section
where drainage is a question, and of course I am satisfied that the
people of my territory in fact, all down South. Mr. Chairman
would be much more disposed to support a bill for irrigation if it
carried with it a provision to reclaim by drainage under the same
terms and conditions.
Gov. DAVIS. Irrigation and drainage go hand in hand, because irri-
gation of a project comes first, and drainage is required sometimes
later on. and the two go hand in hand.
Mr. SIXXOTT. Governor, has your association taken up the ad-
visability of inviting Congress at some adjournment to view the
projects that are now established ?
Gov. DAVIS. I think you have a standing invitation from the
Western States Reclamation Association to visit the projects. I
know we emphasized that in particular when we were here a year ago,
and we were very much gratified, indeed, when your committee made
a trip through the West last year. We believe that it was of great
benefit to us as well as to the members of the committee.
Mr. SIXXOTT. I mean some action on the part of the association
or the States concerned to invite at the expense of the States the
entire Congress, or 100 or 200 Members, or as many as might want to
take advantage of the invitation to visit these projects. It has been
agitated to some extent.
Gov. DAVIS. We have not considered the situation, Mr. Sinnott, at
the expense of the States. We think that the Government is inter-
ested: that this is not a local proposition; but it is a national proposi-
tion : it is of just as much concern to the East in the way of develop-
ing the market for the output of manufacturers and wholesalers as
it is to us in the W
Mr. SIXXOTT. Well. I saw how the Appropriations Committee was
impressed when they made their last visit, and I have regretted that
just one committee making the visit, and I would like to see
200 or 300 Members of Congress visit some of these projects and see
the success that they are really making of them.
Gov. DAVIS. It would be very beneficial, no doubt, and no doubt
many States could have made some provision to participate in the
expense, had this matter been approached during the sessions of the
legisla"
Mr. SINXOTT. I know a number of commercial bodies have taken
it up with the idea of cooperating between various States and bodies
interested in raising a fund, with the object in view of inviting Con-
ij-tv at some adjournment to visit these projects.
Gov. DAVIS. But I do believe that it is of sufficient importance,
national in scope, that our Government should not hesitate for a
moment to pay the expense of such a trip.
Mr. SINXOTT. Well, we think so ourselves, but we can not get the
vote- for that.
The CHAIKMAX. I concur with you. Governor, unqualifiedly in that
proposition that it is very desirable that we keep the cause of irriga-
tion nationalized all the time, not localized that is, I prefer to have
the General Government, the National Government, represent the
DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES. 9
cau.se all the time and exercise supervision, as far as may be possible,
until projects shall have been fully developed, so as to have uniformity
and bring stability also, as you have suggested.
Are there any further questions, gentlemen ?
Mr. HAYDEX" I would like to ask the governor a question. Of
course you have no difficulty in agreeing among yourselves as gover-
nors of the Western States that a general policy of reclamation should
be adopted rather than to make appeals for specific appropriations
for particular projects in the several States". We likewise have no
difficulty here in securing an agreement among the western Members
of Congress that such a general reclamation policy should be adopted.
The difficulty is that we of the West are few as compared with the
total membership, particularly in the House. The strength of the
West is greater in the Senate" than it is in the House, because New
York and Pennsylvania and Arizona and Idaho are on an equality
in that body, but their voting strength is vastly different in the
House. In order to get any legislation passed, we must have assist-
ance of the Congressmen from the East, backed by eastern influence.
I would like to inquire what the western governors are doing to
secure that influence which is essential in getting reclamation legis-
lation enacted.
Gov. DAVIS. Well, we are carrying on an active campaign of cor-
respondence at this time through manufacturers, for instance, show-
ing endeavoring to show them the importance of reclamation of the
West from a commercial standpoint, and I think we are getting sup-
?ort in that particular. Just last Wednesday we were over at New
'ork, and Mr. Blanchard, of the reclamation'department the Inte-
rior Department who is the publicity man of the department, was
there and put on pictures of development in the West, showing the
sagebrush plains and the brush being removed, the dams being
built and the water distributed, and the crops being sown and har-
vested, and all that. I think we got a considerable amount of valu-
able publicity out of that.
Mr. HAYDEX. I made the inquiry, because I know how easy it is
for a governor or a Congressman or a Senator in any of the Western
States to call a meeting of his constituents and make them a speech
about the benefits of irrigation, with which they are all familiar and
to which they are all converted, all convinced, before anything is
said or done. The place where the propaganda must be carried on
if we are to use that much-abused term is in the eastern sections of
the country where they do not know anything about irrigation, and
where their Congressmen and Senators can best be converted by the
fact that their constituents have become interested in reclamation as
a national question.
There is one other powerful source of influence which can help us
to secure the enactment of reclamation legislation, and that is the
active aid and assistance of the President of the United States.
I understand that the western governors have recently visited the
President and would like to know what he had to say about this
question.
Gov. DAVIS. I don't wish to quote the President, but we called on
the President yesterday in a body and had a most satisfactory
conference with him. I don't think you need to fear at all not having
sympathy and cooperation there.
10 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
The CHAIRMAN. My understanding is that the President when a
candidate was all right on the proposition, and I think he will fulfill
his pledges.
Mr. HUDSPETH. Will he give out a statement to that effect (
The CHAIRMAN. I have an idea that he would have no objection to
expressing himself very decidedly in favor of the cause; the question
is how much money you are going to get.
Mr. HAYDEN. The way that the original reclamation law was
secured was first, that Mr. Roosevelt, as President of the United
States, met with the western Senators and Congressmen and
agreed upon a general policy of reclamation, and then sent a message
to Congress favoring the enactment of that particular policy. Every-
body pulled together and the law was enacted. When the time came
to extend the period of payment of construction charges on reclama-
tion projects from 10 to' 20 years, the western Congressmen and
Senators and the then Secretary of the Interior, Secretary Lane.
again agreed upon a general policy which was backed by President
Wilson, and put across. The same thing must be done this time.
It is utterly futile to imagine that the Members of the House and the
Senators from the States of the West, looking merely to advancement
and growth of their own localities, can get anywhere. It must be
done as a matter of national benefit, and the man who speaks for the
Nation is the President of the United States. He must agree with us
upon a reclamation policy and give it his hearty support before it
can be enacted into law. There is no dispute "about that. I am
glad indeed that the governors have conferred with the President
and found him sympathetic.
The CHAIRMAN. I am sure that will be very helpful.
Gov. DAVIS. I believe your committee remembers when we were
here a year ago the Western States put on a campaign of education
along this line as having both of the old parties indorse reclamation
in their platforms. We wrote personal letters to every delegate that
was elected to each of these conventions, and when they met we had
no trouble having a good strong plank put into the platform. Each
candidate for President committed himself unconditionally for recla-
mation, both in writing and in public speeches. Yesterday the
President reiterated to us he said to us, >My whole heart is : with
you," and just the thing that you speak of here I think will be forth-
coming without a doubt. I would not say that it would come in
this special session of Congress, because you are crowded for time
and you are very busy. I think it would please him very much,
however, if it would pass at this Congress, but I would not feel that
you could depend upon having such a thing as a special message
and so on.
Mr. LITTLE. How is that ?
Gov. DAVIS. I don't think you could figure on a special message
during this short session, because you are so busy and there is so
much before Congress.
Mr. LITTLE. In which House do you think the attempt should be
made first to pass the bill I
Gov. DAVIS. I haven't given that any thought.
Mr. LITTLE. Don't you think that is a very important point?
Gov. DAVIS. I have gained the impression here that the bill might
come from the Senate with perhaps more ease that it would from the
House.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 11
Mr. SINNOTT. They have held extensive hearings in the Senate.
Goy. DAVIS. And it might pass the Senate easier than it would up
here in the House.
Mr. SINNOTT. They have already held extensive hearings on this
bill.
Gov. DAVIS. Yes; they have.
The CHAIRMAN. If there are no other questions, gentlemen, we will
hear Gov. Campbell of Arizona.
STATEMENT OF HON. THOMAS E. CAMPBELL, GOVERNOR OF
ARIZONA.
Gov. CAMPBELL. Mr. Chairman, I think that Gov. Davis has cov-
ered the points of the various States in the West very fully, and any-
thing that I might add would simply be a reiteration of what he has
stated. I don't think it would be well to take up the time of this
committee simply rehashing the statements that he has made. We
are all in very happy and earnest accord with the position taken by
Gov. Davis, as representing the Western State Reclamation Asso-
ciation.
The CHAIRMAN. We will all take judicial notice that Arizona is in
favor of irrigation anyhow.
Gov. CAMPBELL. Yes, indeed.
Mr. SINNOTT. Actual notice, too.
The CHAIRMAN. We are pleased to have your practical suggestions,
Governor, as well as any theories that you may have to place before
the committee.
Gov. CAMPBELL. Well, it is very good of you to ask me for sugges-
tions, but I don't know of any that I can present to this body that
would illuminate it any. My presence here is to subscribe to the
principle of reclamation. W T e know what it has done for the West;
we want more of it; and the particular thing in our being here is to
show to the Congress the unanimity of opinion and desire on the part
of the arid and semiarid States toward the general policy of this
composite bill known as the Smith-McNary bill. In our conference
at Denver here last week we unanimously adopted a resolution cover-
ing the principles of this bill that was then discussed before that
conference.
The CHAIRMAN. And I suppose you will admit, Governor, that
Arizona has one of the greatest projects under the national reclama-
tion law of any State, and possibly you would admit that it is the
greatest of any ?
Gov. CAMPBELL. I would admit that. [Laughter.]
Mr. ARENTZ. And the people under this project are great spenders.
In other words, the thing that has to be impressed upon the eastern
man is the fact that irrigationists buy automobiles, all kinds of clothes,
good clothes, good shoes, all kinds of supplies that are made in the
East, and for every farm that is taken up in the West, the East is
benefited, and it is not a selfish motive that we assume, but it is a
motive that this is something to help the whole country.
Gov. CAMPBELL. There is no question about that, Mr. Congress-
man. Some times I fear they spend too much for their own good.
In a town of 30,000, Phoenix, being the center of the Salt River
project to which the chairman referred, we have no less than 10,000
automobiles.
12 DEVELOPMENT OF AGRICULTURE IX THE UXITKD STATES.
Mr. AREXTZ. That will answer my question. That is what I
mean.
Mr. HERRICK. Mr. Chairman, may I ask the gentleman a question?
When are you gentlemen going to leave Washington ?
Gov. CAMPBELL. I wish I could answer that question.
Mr. HERRICK. Will you be here Monday I
Gov. CAMPBELL. I will be very glad to be here.
Mr. HERRICK. What I want to get at is that I come from a district
in which we have, not every year, but as a general thing, too much
rain in the early spring months, April and May. and practically none
sometimes during June, July, and August, and generally always
during July and August. Our crops start out very nicely through
the spring season, unless they suffer from too much rain.' and they
generally burn up during August; therefore in my district we have
ample and an abundant surplus of water in the spring, if it could be
impounded, and none during the time when crops arc making, and
I have an inclination to either offer some amendment to this bilf when
it comes up for passage or to introduce a different bill that is, not in
conflict with this bill, of course.
The CHAIRMAN. Will the gentleman from Oklahoma yield just a
moment ? There are several gentlemen here to be heard" and we do
not want to take up that question now.
Mr. HERRICK. No; but what I want to get at is whether these
gentlemen are willing to come to my office on Monday or some other
da3 T next week and confer on this matter and give me some more
information on it ?
The CHAIRMAN. I am satisfied that they will make some arrange-
ments with you, but you can see about that after the hearing con-
cludes.
Gov. CAMPBELL. I am quite sure we will be very glad to make an
engagement with the Congressman and discuss the features of that
proposition.
Mr. HERRICK. I would like to see you on whatever day that is
convenient.
Gov. DAVIS. Gov. Campbell, I might suggest I did not make it
quite clear a moment ago about the President expressing himself,
his pleasure, if this special session should see fit to act favorably on
this measure. I didn't bring that out clearlv.
Gov. CAMPBELL. Down in our country we have developed only one
diplomat, and that is Representative Hayden. I don't know how far
one could go and not be guilty of lese majeste here is Washington.
The governor of Idaho stated almost exactly what the President
slated yesterday. However, I think that we should know the bal-
ance, and if we arc put under arrest we won't mind it. The President
stated that this was an extraordinary session called primarily for the
purpose of tax and tariff legislation, and that while he was in hearty
accord witli the spirit of reclamation, he hoped that this would not
embarrass the purposes for the call of this Congress, but that if this
measure could be passed at this Congress without interfering with the
purposes of the call for this session, he would be pleased. I think that
is substantially correct, is it not, Gov. Ma boy '.
Gov. MABEY. Yes.
Gov. DAVIS. That is the point I did n6t state quite clearly.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 13
Mr. SMITH. I think it is quite true that the President has so inti-
mated to quite a number of western Members of Congress since the
inauguration, that he was friendly to the reclamation of arid lands,
and of a wider and more comprehensive policy along that line.
The CHAIRMAX. Now, Gov. Mabey, the committee will be pleased
to hear you.
STATEMENT OF HON. CHARLES R. MABEY, GOVERNOR OF
UTAH.
Gov. MABEY. Mr. Chairman and gentlemen, I have nothing further
to add to what has already been said except to state that Utah
heartily indorses this movement. We agree exactly with what the
other States are doing. I think we know something about irrigation.
We like to boast of what we have done.
The CHAIRMAX. You started the initial irrigation system, I believe.
Gov. MABEY. We like to boast of having been the first State to
initiate irrigation in this country.
I was pleased to hear Gov. Davis state that irrigation has outgrown
the power of private capital, and that is the reason why we are here.
We need the capital of the Government of the United States behind
us for further development. As you gentlemen all know, in the
earlier history of irrigation the farmer took his water out from the
small streams that cost him practically nothing to develop his land,
and with the growth of the States, larger bodies or streams of water
were taken out until now it is impossible for us to cope with the
situation without help from the outside.
Mr. WILLIAMSON. Right there, Governor, have you any difficulty in
your State by reason of conflict arising between your national recla-
mation projects and your private irrigation projects ?
Gov. MABEY. None whatever.
Mr. WILLIAMSON. You have no controversies over rights to water?
Gov. MABEY. No, sir.
Mr. WILLIAMSON. It occurred to me that there might be cases, while
the chairman stated there was no conflict between the Senate bill
and the House bill, that it might result in conflict later on in attempt-
ing to secure water for these private projects and for the national
projects, that it would be better to have one policy only, namely, a
national one and discard the other. I would like the opinion of the
governors on that question.
The CHAIRMAN. I would just say to the gentleman from South
Dakota that so far wherever the Government has developed a project
under the national reclamation law and has found projects already
in operation, they have generally taken them over, and the private
projects have been glad to be put under the control of the General
Government. They unified the operation, and it has been helpful in
every instance to the private projects. It has been a boon to the
private projects that a Government project has been developed in
the same locality. It always has been a benefit to private projects,
and the Government reservoirs have been 'furnishing them with water
in times of stress. We passed an act for the selling of water to
private projects, so that there has been no conflict at all, but, on the
contrary, the General Government, the operation of the General
14 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Government, has developed a policy for the development of projects
under the reclamation law that has been very beneficial to the private
projects, and harmony has existed wherever I have heard anything
about it in each instance.
Gov. MABEY. I might say, gentlemen, in connection with this, that
we have had under consideration in Utah the storage of the head-
waters of what are known as the Wever and Provo Rivers. It is a
project that would be entirel}* too big for any of our capital to handle.
Now, the lines which would come under this project are already
partly developed through irrigation, but I know it is the sentiment
of the people there that they would be glad to have the Federal
Government come in and take over the proposition and work out a
big scheme that would redeem hundreds of thousands more acres of
land.
Mr. SINNOTT. Isn't it also true that the Government can not obtain
any water rights without securing those rights under the laws of the
particular States ?
Gov. MABEY. That is my understanding; yes, sir.
There is one matter that I have heard discussed considerably since
coming to the governor's conference and since coming here, and that
is the objection that Central States might have I mean the Missis-
sippi Valley States might have to this because of the increase in the
output of farm products. To me the so-called objection is puerile.
We are growing so rapidly in population in our cities that we can
hardly take care of markets, and besides the Pacific coast has grown
so quickly, so rapidly in population in the last few years, that we in
Utah are sending most of our products, such as our wheat, to the Pacific
coast, and there is a very large market developed in China and Japan.
So to me the objection,' if there is such you may not have heard it
here does not amount to anything at all.
Mr. SIXNOTT. That same objection was urged for 30 years against
the passage of the original homestead act.
Gov. MABEY. Yes, sir. There is another feature connected with
this particular Stttith-McNary bill that hasn't been brought out, and
that is ref erring to taking care of the ox-service man in some way.
This bill, as I understand it, takes care of him not for one vear or two
vears but for good. As an ex-ser\ ice man that feature of it particu-
larlv appeals to me.
Now, gentlemen. L don't know that 1 have anything further to add.
Mr. HUDSPETH. Let me ask you this: A number of representatives
and Senators met with the Western Irrigation Congress here about
two months ago. 1 believe your predecessor was then chairman, Gov.
Spry. You gentlemen are part of that congress, are you (
Gov. MABEY. Yes.
Mr. Hrnsi-KTH. Will you have a committee here during the ses-
sions, this session, representative of your congress '.
Gov. MABEY. Yes, sir: we have Mr. l>laine. who will be here all the
time.
Mr. HrDSPETii. So that we may confer?
Gov. MVBEY. Yes, sir.
Mr. AKKNTZ. May 1 ask one question? This is'not exactly apropos
to this question, but it has to do with irrigation. There is a time
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 15
coming when you are going to dam the Green River above Jensen
near Vernal in Uintah County, Utah.
Gov. MABEY. Yes, sir.
Mr. ARENTZ. Now, has the question come up to your mind relative
to the international question involved in the storage of the water of
the Green River and the disposition of that water on soils outside of
Mexico, and don't you think it would be a good scheme to start that
now. so you will get an answer to that question, so that when it does
come up in 5 or 10 vears from now we will know what we are going
to do ?
Mr. LITTLE. That has been pretty well settled, I think.
Mr. ARENTZ. No, that has not been settled yet. That was the
bone of contention the other day when we called on Secretary Fall.
Mr. LITTLE. The Supreme Court of the United States held on that,
you know, in the New Mexico and Texas and Mexican case.
Mr. ARENTZ. You get my idea ?
Gov. MABEY. I understand you thoroughly, I think, and since this
matter was discussed at some length during our meeting at Denver,
wherein seven States were represented in what is called the League
of the Southwest, Gov. Campbell being president of that league. I
think perhaps it would be better for him to answer that than for me,
and with your permission I will withdraw and let Gov. Campbell make
that statement.
Gov. CAMPBELL. Appreciating the difficulty that would ensue
sooner or later on this interstate and international question of the
use of the waters of the Colorado River, which, as you know, is a
tremendous stream in its flow, embracing some 244.000 square
miles, covering extensively seven States of Wyoming, Colorado.
Utah, Nevada. New Mexico. California, and Arizona, we a year and
a half ago met and discussed the problems of the Colorado River in
its various angles. Finally at Denver last August we agreed that it
would be necessary to enter into a compact or treaty among the
States themselves and the Federal Government, to the'end that the
rights of the use of the water of the Colorado River and its tribu-
taries would be adjudicated and adjusted before any big scheme,
such as will probably come about in the matter of reclamation,
should be entered into.
Mr. SIXNOTT. There is a case now pending in the Supreme Court,
isn't there, to determine that matter as between two States (
Gov. CAMPBELL. Yes: but we want to keep out of the courts. Mr.
Sinnott: we want to build dams and power plants.
Mr. SIXNOTT. I thought probably that decision when it is handed
down would determine the rights as between the respective States.
Gov. CAMPBELL. Yes; there is no question about that; but there
is a provision in the Constitution of the United States whereby
States may enter into treaties with each other.
Mr. SINNOTT. Provided the treaties are ratified by Congress.
Gov. MABEY. That decision, however, would not decide just what
each State under the Colorado River is entitled to.
Gov. CAMPBELL. Oh, no; it would just be a legal point.
Mr. SINNOTT. It would decide the general legal question (
Gov. CAMPBELL. Yes. Answering your question, all of the legis-
latures in the various Southern States referred to have now arranged
16 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
the first legislative step to enter into this treaty this compact -
and we have come on here and a bill will be introduced, I think,
to-day or to-morrow requesting the Federal Government to join us
in arranging for this committee to do just that work.
Mr. LITTLE. Mr. Chairman. I thinK there is a little misunder-
standing there. Gov. Campbell talked about "treaties" between
the States. I think Ms view is certainly a good one. The gentle-
man from Nevada spoke primarily, as I understood him, of the
Mexican difficulty. I think the Supreme Court of the United States
has disposed of the Mexican question. The other one, of course, is
different proposition, and the governor has presented the right view.
I would like to have Kansas get in on that treaty, too. Colorado
has been eating us up on that.
Gov. CAMPBELL. If I may answer that, after this plan was evolved
and got well underway, a number of the other States made the same
suggestions, but we did not think it would be a good thing to attempt
to legislate matters out of court. The Colorado at the present time
has none of the difficulties that you are experiencing with the Ar-
kansas, and for that reason we were desirous of seeing if this would
not work out, adjudicate these things before and not after we got
into court, and we are hopeful that if it does work out, then there
will be a similar compact and treaty between Colorado and Kansas
and Wyoming and Nebraska and Oregon and Washington and
Montana.
Mr. LITTLE. We haven't found the courts take just the right view
of that. I am in favor of that treaty.
The CHAIRMAN. Now we have the representatives of some other
governors here.
Gov. DAVIS. Mr. Chairman, the attorney general of Colorado is
here, and he might have something to say.
The CHAIRMAN. We will be glad to hear the attorney general of
Colorado.
STATEMENT OF HON. VICTOR E. KEYES, ATTORNEY GENERAL
OF COLORADO.
Mr. KEYES. Mr. Chairman, I really have nothing to add to what
has already been said on the various questions. The "Western
States, of course, are interested in the general cause of irrigation.
We hope for some general reclamation project, sufficient in scope
to take in the various States, and especially perhaps are we thinking
of the Colorado River project, which at present is largely undeveloped.
Along the line that Gov. Campbell spoke of. the various States are
endeavoring at least to negotiate these treaties among themselves so
the States will be enabled to keep out of litigstion. To this end all
the States in the Colorado basin have appointed a so-called river
commissioner, and it is hoped that these river commissioners may
work in harmony with the general reclamation act so that there will
not be this conflict if interest among the vatious States.
The CiiAiKMA.x. Let me ask right there, have you passed has
your legislature passed any laws authorizing the appointmentof
commissioners for that purpose '.
Mr. KF.YK.S. Yes, *ir.
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 17
The CHAIRMAN. Commissioners from the States to be bound by
their agreements (
Mr. KEYES. I think all of the States in the Colorado River Basin now
have passed laws the legislatures have enacted laws authorizing
the governor to appoint a commissioner to negotiate treaties pertain-
ing to the waters, for instance, of the Colorado. These commissioners
then are to report back to the legislatures. It is also asked that the
Federal Government likewise appoint a commissioner or commis-
sioners to cooperate with the commissioners of the various States.
It is believed that in this way the Federal Government and the States
may work in harmony, so there will not be this conflict of interest.
I might say. with reference to Kansas, Mr. Congressman, that I
received word a few days ago from Attorney General Hopkins, ol
Kansas, to the effect that Gov. Allen, he thought, would appoint
such a commissioner. That would be subject, however, to legis-
lative enactment, but if the report of the commissioner were reported
back and adopted by the legislature I presume it would be binding in
the same way as though it were authorized originally by legislative
action.
Mr. SIXXOTT. Have you any idea of the prospect of a decision of
that Wyoming and Colorado case ?
Mr. KEYES. It has been argued and has been ready for decision for
a long time. I have thought that we should have a decision every
montn, but it may be years before a decision is secured.
Mr. SIXXOTT. It is likely that that decision will solve some of these
legal question between respective States.
Mr. KEYES. It may, but the Colorado-Kansas case did not solve
very much, because they went off on another point. So it is rather
difficult to say just what the effect will be, but, as Gov. Campbell has
so well pointed out, so far at least as the waters of the Colorado are
concerned, it is a new project, and if we can arrange these matters
beforehand we can keep out of litigation. Litigation is expensive;
it is costly: and usually does not do very much good. Colorado has
been sued by, I think, most of the States all around here. We are
anxious to keep out of litigation, if possible.
Gov. CAMPBELL. Mr. Chairman, I think it would be well for the
benefit of your record to have this brief resolution read into it on
this particular point.
The CHAIRMAN. Very well, you may read it, if you will.
Gov. CAMPBELL (reading) :
"Whereas the States of Arizona, California, Colorado, Nevada, New Mexico, Utah, and
Wyoming have by appropriate legislation authorized the governors of said States
to appoint commissioners representing said States for the purpose of entering into
a compact or agreement between said States and between said States and the United
States respecting the future utilization and disposition of the waters of the Colorado
River and the streams tributary thereto-; and
"Whereas the governors of said several States have named and appointed the commis-
sioners contemplated by the legislative acts aforesaid: Now therefore be it
Resolved, That the Congress of the United States be, and it is hereby, requested to
provide for the appointment of commissioners on behalf of the United States to act
as members of said commission ; and be it further
Resolved, That the proposed draft of a bill for presentation to Congress, a copy of
which is hereto attached, be offered as a suggestion for legislation for the purposes
aforesaid; and be it further
5666421 2
18 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Resolved, That Gov. Thomas E. Campbell, of Arizona, and the governors of the other
States in the Colorado River Basin, or such representatives as they may severally
designate, be, and they hereby are. authorized to present this resolution to the Presi-
dent and to the Congress of the United States.
We. the undersigned, do hereby certify that the foregoing resolution was adopted
by unanimous vote at a meeting of the governors of Arizona, California, Colorado,
Nevada. New Mexico, Utah, and Wyoming, held at the capitol at Denver, in the
State of Colorado, on'.the 10th day of May, 1921.
THOMAS E. CAMPBELL,
Governor of Arizona.
WM. D. STEPHENS,
Governor of California.
By W. F. MCCLURE,
State Engineer.
OLIVER H. SHOUP,
Governor of Colorado.
EMMET D. BOYLE,
Governor of Xevada*
MERRITT C. MECHEM,
Governor of Xen: Mexico.
CHAS. R. MABEY.
Governor of Utah.
ROBERT D. CAREY,
Governor o
Mr. SIXXOTT. Have 3*011 a copy of the proposed bill ?
Gov. CAMPBELL. Yes, sir.
The CHAIRMAN. That is certainly a verv constructive proposition.
Mr. SIXXOTT. I would like to have tho bill read.
Gov. CAMPBELL. The proposed bill accompanying the resolution
just read is as follows:
A BILL To provide for a compact commission between the States of Arizona, California, Colorado,
Nevada, Xew Mexico, Utah, and Wyoming and between said States and the United States respecting
the disposition and utilization of the waters of the Colorado River for irrigation and other uses, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America
in Congress assembled, That a joint commission, to be composed of representatives of
the States of Arizona, California, Colorado, Nevada, New Mexico, Utah, and Wyo-
ming, and of two representatives of the United States of America, to be appointed by
the President of the United States, is hereby authorized and constituted for the pur-
pose of negotiating and entering into an arrangement, compact, or agreement between
the said States and the United States respecting the further utilization and the dispo-
sition of the waters of the Colorado River and streams tributary thereto and tixing
and determining the rights of said States and of the United States in and to the use,
benefit, and disposition of the waters of said streams: Proiidtd, That any arrangement,
compact, or agreement so entered into by representatives of said States and of the
United States shall not be binding or obligatory upon any of the parties thereto unless
and until the same shall have l^een ratified and approved by the legislature of each
of said States and by the Congress of the United States.
The CHAIRMAN. That would be a very complete legal arrangement.
Mr. UERRICK. Would the chairman allow me to ask just one ques-
tion ? Would you gentlemen representing these States object to an
amendment something like this, that any other State affected thereby
would be admitted into this sort of a whatever you choose to call
it, whether you choose to call it an agreement of States, or whatever
other name might eventually be adopted would you object to an
amendment to the effect that any other State affected thereby might
be admitted (
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 19
GOT. CAMPBELL. There is no other State affected along the Colorado
River basin.
Mr. HERKICK. Xo; but this will become a matter of general scope,
applicable to all streams originating in one State and running into
another.
Gov. CAMPBELL. In my opinion I don't see any particular objection
if an amendment could be brought about and inserted in this bill
allowing other States to come in as a general proposition.
Mr. HERRICK. Well, if the chairman will permit me just two or
three brief words, 'I will explain what is in my mind.
You see the State of Mexico for one, they have the following
rivers originating in their State and running into my State: the
South Canadian, Beaver River, and the Cimarron River, partly in
New Mexico and partly in Colorado. Those three rivers originate
beyond our State and'flow into our State, which gives us a very
similar, analogous case to the Colorado and Kansas case. No con-
troversy has been raised so far, but there is no telling when one
might be.
The CHAIRMAN. That would be a good example precedent or
whatever you might call it for New Mexico and Oklahoma to emu-
late, you see. it is a good pattern for them to go by.
Mr. HERRICK. That is what I am driving at.
The CHAIRMAN. Nobody could have any objection to that at all.
Gov. CAMPBELL. No; the question of treaties between States is
no new thing, although the matter of adjudication of waters in a
stream of this sort is. Just the other day a treaty was entered into
between the States of New York and New Jersey in the matter of
the utilization of the harbor of New York. We have the boundary
cases between Kentucky and Tennessee. So that matter could follow
after this becomes workable, which we hope it will.
Mr. SIXXOTT. Oregon and Washington have entered into an agree-
ment regarding the fishing on the Columbia River.
Gov. CAMPBELL. Yes, sir.
The CHAIRMAN. We would like to hear you now, Mr. Ely.
STATEMENT OF MR. SIMS ELY, SECRETARY RESOURCE
BOARD AND MEMBER EXECUTIVE COMMITTEE, WEST-
ERN STATE RECLAMATION ASSOCIATION, PHOENIX,
ARIZ.
Mr. ELY. As Gov. Davis stated a few moments ago. a resolution
was adopted at Denver approving in principle the Smith-McNary
bill, and that is the resolution, as I understand it, that you would
like to have filed here ?
The CHAIRMAN. Yes; we wish to have that filed, and would like to
have you send it.
Mr. ELY. I will furnish it to your secretary.
The CHAIRMAN. Very well, it will be filed then and incorporated
in the record.
20 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
(The paper referred to follows:)
RESOLUTION' ADOPTED AT THE CONFERENCE OF THE GOVERNORS REPRESENTING THE
STATES CONSTITUTING THE WESTERN STATES RECLAMATION ASSOCIATION AT DENVER,
MAY 11, 1921.
Be it resolved by the governors of the States of the Western Stages Reclamation Associa-
in conference assemblt n <\> !/< m<r. Coin., this ll>h fhi>i of linn. l't_'l. Th.it the prin-
ciples expressed in the bills now pending before Conure-s and introdur-ed in the
House of Representatives by Mr. Smith of Idaho and in the Senate by Mr. McXary
of Oregon, providing for the appropriation of $250.000.000 for. reclamation pun
have the approval of this conference and the governors here assembled recommend
favorable consideration of said measures by Conm
THOMAS E. CAMPBELL.
Governor of Arizona.
WILLIAM D. STEI B
Governor of California.
By W. F. MC.-CI.URE,
Slab
OLIVER SHCUP,
'/" Colorado.
D. W. DAVIS.
Governor of Idaho.
EMMET D. BOYLE.
i n\(>r of Xeiada.
MERRITT ('. MECHEM.
Governor of A
BEN W. OLCOTT,
Governor of Oregon.
By WM. J. HANLEY.
CHARLES R. MABEY,
Governor of Utah.
S. R. McKELVIE.
Gorernor of X(bru*!.-u.
By ROBT. H. WILLIS.
ROBERT D. CAREY.
"ing.
By FRANK C. EMERSON.
Louis F. HART.
d'ofifnor of }\~<i*J<ington.
The CHAIRMAN. Have you anvone else, governor ?
Gov. DAVIS. I think that is all. Gov. Hart, for some reason, is not
here. He perhaps missed the hour or the room.
The CHAIRMAN. Now, Mr. Blaine is going to be here during the
session, I believe.
Gov. DAVIS. Yes, Mr. Chairman; for your aid and assistance, Mr.
Blaine will be here, representing the Western States, also Mr. Brown,
of Idaho, is here, and Mr. Sims Ely is going to remain in the city for a
while to cooperate and lend every assistance to Members of Congress
that they possibly can. We wilTnave from two to three men here for
some time.
I was very glad to hear Gov. Mabey bring out the fact that this bill
would go on perpetually for many years to come, anyway, taking care
of the soldiers. That brought to my mind one point, and that was
that the House of Representatives went on record a year ago favoring
some appropriation amounting to something like $250,000,000 for
soldier bonus. It seems to me that this would take its place in a very
substantial manner, and vet we overlooked stating that we had in our
delegation Secretary Fall, the Commissioner of the General Land
Office, former Gov. Spry, when we called on the President, and we had
a very fine meeting, indeed.
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 21
The CHAIRMAN*. And they are in sympathy Secretary Fall and
Gov. Spry in full sympathy with the cause you governors are repre-
senting here ?
Gov. DAVIS. Yes. sir.
The CHAIRMAN*. It will soon be time for the House to convene, and
if there is nothing further the committee will adjourn, and I wish to
say that we arc very grateful to the governors for coming here, and to*
the representatives of the governors, and to Mr. Blaine, for the
valuable assistance you are rendering us here for the cause in behalf
of irrigation.
Mr. SMITH. Mr. Chairman, there are several witnesses of importance
appearing before the Senate Committee on Irrigation, notably the
president of the Northern Pacific Railroad, and I think we should, if
possible, adjust the time of the hearings here so as to accommodate
those witnesses who are appearing before the other committee.
The CHAIRMAN*. The chairman of the committee will try, if possible,
to accommodate those witnesses, with the assistance which I assume
we will have from the members of the committee.
Mr. SIXXOTT. I think it will be very important to have him before
the committee the president of the Northern Pacific.
The CHAIRMAN. Yes, indeed.
Mr. SMITH. At the next meeting I wish it might be arranged that
Mr. Blaine, who represents the Western States Reclamation Asso-
ciation here might discuss the details of the bill so that the committee
will understand it more fully.
The CHAIRMAN*. Yes; and we want to hear Mr. Blaine very soon.
The committee now stands adjourned.
(Whereupon, at 11.45 O'clock, the committee adjourned.)
COMMITTEE ox IRRJGATIOX OF ARID LANDS,
HOUSE OF REPRESENTATIVES,
Monday, May 23, 1921.
The committee met at 10.30 o'clock a. m., Hon. M. P. Kinkaid
(chairman) presiding.
The CHAIRMAN*. The committee will come to order. Gentlemen,
this meeting was called expressly to hear Mr. Blaine, representing
the governors' organization in behalf of reclamation, in support of
H. R. 2913, introduced by Mr. Smith, and we will hear Mr. Blaine
now. Mr. Blaine. will you give the reporter your name, residence,
and whom you represent here ?
STATEMENT OF MR. E. F. BLAINE, SEATTLE, WASH., OF THE
LEGISLATIVE EDUCATIONAL COMMITTEE OF THE WESTERN
STATES RECLAMATION ASSOCIATION.
Mr. BLAIXE. Mr. Chairman and gentlemen, I am down here as a
member of the Legislative Educational Committee of the Western
States Reclamation Association. The Western States Reclamation
Association is an organization something like two years old. It was
formed in Salt Lake City, and at the meeting at which it was formed
there were present from various Western States 168 persons, every
one of the Western States and semiarid States being represented.
22 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
The form, of organization effected was a president, secretary and
treasurer, and an executive committee of 13, the executive com-
mittee consisting of one person from each of the 13 States interested
in this movement. At Salt Lake City I was present to represent the
State of Washington as a member of the executive committee, and
I am still functioning in that capacity as well as being one of the
members of this special committee on legislation and education.
Gov. Spry, now Commissioner of the General Land Office', came
to this city in January, and we have been here since, of course work-
ing together until he was chosen Commissioner of the General Land
Office. Since then I have been working in conjunction with Mr.
Brown, the secretary of the organization. We have had something
to do with the drafting of the Smith-McXary bill, and have sought
to have a bill presented here which in our judgment would not only
work for this year and next year and for a few years and then cease,
but we sought a plan here by which all the lands of the West sus-
ceptible of reclamation can be reclaimed.
This bill contemplates cooperation between a State or States, the
subdivision or subdivisions of a State or States, and the Federal
Government in reclamation. If a State or States or subdivision or
subdivisions of a State wish to cooperate with the Federal Govern-
ment under the provisions of this bill, a petition is addressed to the
Secretary of the Interior, setting forth what is desired. The first
thing that is presented is a map showing a district, the lands to be
reclaimed, and there is also presented with the map plans, estimates
and a description of the project.
Upon receipt of such a petition the Secretary- of the Interior
makes his investigation, and if he finds that the project is feasible,
and if he also finds that the lands to be reclaimed are of such a
character as ought to be reclaimed, and if reclaimed there will be
settlement of the lands, .and if he further finds that a district has
been organized in conformity with the laws of the State in which
the project is situated and that it has power to enter into a contract
with the Secretary of the Interior for the building of the project, has
power to issue bonds to pay for the cost of the project, then upon
that, and further if he shairfind that the laws of the State authorize
the contract, and also that the laws of the State authorize a levy of
assessment to pay the bonds, and further authorizes the levying of
assessments or taxes to keep the project a going concern in serving
the people under it; if he further finds that the organization of the
district and the validity of the bonds have been passed upon by a
court in the form of a confirmation, or in the absence of that, that
such time has elapsed as to put the question at rest.; also that the
owners of the excess lands shall have agreed with the Secretary to
sell their excess holdings at prices and terms and conditions agreed
upon, then he may, if satisfied with these things, enter into a contract
to build the project.
Mr. SUMMERS. What do you mean by "excess holdings," may I
ask?
Mr. BLAIXE. That is explained further on in the bill, Dr. Summers,
but I can explain it now.
Mr. SIXXOTT. That is the same as is provided for in the present
reclamation law?
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 23
Mr. BLAINE. Yes, sir; but you have asked the question and I can
answer it now as well as at any other time.
It has always been the policy of the reclamation service not to
spend the Government's money in reclaiming too large an acreage
for any one holder of land. The policy of the Government as now
announced is not to reclaim for any one man to put up the money
to reclaim for any one man.an amount of land exceeding 160 acres, but
in several of the western projects the farm units have been fixed by
the Secretary of the Interior at 40 acres, in other instances 60 and
80. So before the Secretary under this law will approve a project
he will fix a maximum farm unit, that is, the amount of land that
any one person can own and have it reclaimed. Now if anyone
owns more land than that within a district, he must agree to sur-
render the excess for the general benefit of the project, and the
price that he is to receive for that land and the terms and condi-
tions of the sale are to be fixed or agreed upon by the Secretary and
the landowner. Now. in my judgment, this is one of the most impor-
tant provisions in this bill. I have had considerable experience in
the reclamation of arid lands of the West. I have been engaged in
that work for nearly 20 years; I am practically out of that work at
the present time, and I have no purpose of reentering the field.
Mr. WILLIAMSON. Does that mean, Mr. Blaine, that after they
come within the project and reduce their projects to 160 acres, that
they are not thereafter to acquire any more land 2
Mr. BLAINE. They can acquire by purchase: yi^.
Mr. WILLIAMSON. That is, they can extend their area after they
have come into the project?
Mr. BLAINE. Yes, if they can buy of somebody that has authority
to sell, that is true. There is nothing in this law to prohibit that, or
under the old law to prohibit that.
Mr. SINNOTT. There is a certain limitation under the old law about
buying afterwards.
Mr. BLAINE. After the title has fully passed, Mr. Sinnott, they
can sell to whoever they please, and in years to come under any of
these projects a man might acquire a great deal of land by purchase.
Mr. HAYDEN. But, as a matter of fact> the tendency is exactly the
other way.
Mr. BLAINE. Very much so.
Mr. HAYDEN. Regardless of the law, the history of every irrigation
project is that the average number of acres owned by individual
water users is less to-day than it was at the time the project started.
In other words, to successfully carry on farming under irrigation
conditions, it is more profitable to intensively farm a small -area than
to attempt to cultivate a large one.
Mr. BLAINE. There is no profit, in my judgment, in seeking to farm
too large an area of reclaimed lands in the West.
The CHAIRMAN. And as a rule, is it not true that it had better be
cultivated by the owner than by any other person, than by a tenant,
and that it is not profitable to have too large a holding I
Mr. BLAINE. You are absolutely right, Mr. Chairman. In the
projects in which I have been interested we have sold considerable
property to the people living in the cities, in Seattle, Tacoma, who
lived across the mountain from the Yakinia Valley and the Okanogan
country, but those people to whom we sold land' did not seem to
24 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
make a success of it. Farming at arms length is an impracticable
matter and generally results in disaster, and the people who hav?
made a success of farming irrigated lands in the State of Washington
are the people who live on it arid own it.
Mr. LEATHERWOOD. I understand, Mr. Blame, that if a man owns
practically half a section may have owned it for years under this
proposed act, he would he required to reduce down to the minimum
that is, to resell his land ?
Mr. BLAIXE. To agree to reduce to the maximum allowed.
Mr. LEATHERWOOD. Is there any standard, or has it been contem-
plated upon what basis the Government then will fix the price I
Mr. ELAINE. I was just going to read that. Of course it is my own
opinion, and this law is to be administered by the Secretary of the
Interior through the Reclamation Service, but I was going to say this,
that so far as my experience goes in the State of Washington and the
Northwest, where substantial areas have been passed on to the pur-
chasers or settlers at reasonable prices, those projects have succeeded;
on the other hand, where the company that owned the land, or who-
ever was the prior owner, had passed the title on to the purchasers or
settlers at prices considerably more than the land was worth, seeking
to get all the equity possible out of it, those projects have failed.
Now, if we are going to succeed under this bill here, in my opinion
the Secretary of the Interior ought to keep the price of this sagebrush
land in the West down, because in my judgment the value is added
to it by bringing the water to it.
Mr. LEATHERWOOD. Somewhere near the basis at which the various
States are selling their land, raw land.
Mr. BLAINE. Well, each project will probably have to be deter-
mined by itself. There are a great many factors that enter into it.
Some of the land that is close to old projects, certain old projects, close
to transportation, and so forth, will have a value much higher than
land lying away out in the desert, and those values have continued
there for years, but still there is what we call a "speculative value."
That speculative value ought to be eliminated, so that when the
soldier or settler goes upon land and the water comes to the soil and
there is a sudden increase in price, that increment should go to the
settlers, and if it does go there they will all have the courage to go
ahead and function and make a splendid community. I have known
instances in my State where they have tried to sell raw land, with the
water rights, for two to three hundred dollars an acre, and those cases
have been failures.
So, in the administration of this law, if it is going to work I think
that the Secretary of the Interior must see that the land is disposed of
at a reasonable figure to settlers.
The CHAIRMAN. Wliat number is that?
Mr. BLAINE. That is under section 2.
The CHAIRMAN. Now, let me ask a question there, Mr. Blaine. The
purpose of that clause, the subdivision, is to prevent having the
wnter user or farmer start on too high a cost basis?
Mr. BLAINE. Yes. sir.
The CHAIRMAN. You want to avoid that very thing.
Mr. BLAINE. Yes.
The CHAIRMAN. And to start on a cost basis which is too high,
which would mean allowing speculators to unload this land on to
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 25
these people by some means or other at a speculative price, it would
make it very difficult it does make it very difficult where that
occurs, as observation has shown, for the farmer or water user to
succeed ?
Mr. BLAINE. Yes, sir.
The CHAIRMAN. And he is always contending with the obstacle. of
having commenced on a high cost basis, on the same principle as
watered stock in railways and other corporations being required to
pay a dividend on a high-cost basis.
Mr. BLAINE. That is right.
The CHAIRMAN. A fictitious basis.
Mr. BLAINE. Yes, sir. Now, I think that fact ought to be deter-
mined; the price should be agreed upon, the terms and conditions
agreed upon, at the time of the formation of the district, the entering
into a contract with the Secretary and not leave the price open to
the owner so that he may get as big a price as he can.
The CHAIRMAN. It is my understanding that is the case under the
present reclamation law, and my attention has just been brought to
one case in which the value of the lands has risen ver}^ greatly since
the agreement was made, since the owners of the private lands
signed up their contracts with the Secretary of the Interior.
Mr. BLAINE. Yes: it is.
Mr. HAYDEN. Has that contract been passed upon by the courts ?
Mr. BLAINE. It has not been passed upon by the courts.
Mr. HAYDEN. It is very important in carrying out the terms of
this provision that an iron-clad contract between the landowner
and the Secretary of the Interior be entered into so that there can
be no possible ground for dispute or misconstruction. They must
agree on a price that the landowner shall get, and he must agree to
deliver a deed whenever he obtains his price, and everything in the
way of increased value of the land should go to the settler.
Mr. BLAINE. I agree with that thoroughly.
The CHAIRMAN. Otherwise, you take away the incentive to the
settlers and to home building. We will have to make this proposi-
tion very plain, as one of the fundamentals of the bill, that that be
done, and that it will make it a genuine home-building bill.
Mr. BLAINE. And that is very necessary when we are trying to do
something under this bill for the ex-service men.
The CHAIRMAN. Yes.
Mr. WILLIAMSON. Wouldn't it be better to ask the Government to
take over these excess lands at the time the project is organized, and
then sell it directly to the proposed settlers, in place of leaving it to
be purchased from the original owners?
Mr. BLAINE. Well, that would take more money, and there has
been no great difficulty, so far as I know, in the settler buying of the
original owner and paying him for it, where the Reclamation Service
has had an understanding with the owners of excess land.
Mr. SMITH. If the owner is required to enter into an agreement
before the project is started, there would really be on occasion for the
Government putting up any money to get control of the land.
Mr. SUMMERS. There would be very great opposition on the floor
to the Government buying these lands, but it seems to me that if
this bill does not, it should definitely state the size of the unit, and that
it should definitely determine the fact that the price must be fixed
before the Government ever enters into the project.
26 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. ARENTZ. Of course there are quite a number of objections that
could be raised against the placing of a limit on the acreage to star
with in this bill, for this reason, that in certain sections of the West
it is strictly alfalfa land. Xow. a man can not make a success, in
some sections of the country, on 80 acres of alfalfa. In other words,
he has to have pasture; he has to have a small acreage for potatoes,
and he has to have a certain amount also of alfalfa, but in other
sections of the country you take it down in the Salt River Valley,
in the Imperial Valley, in the Palo Verde Valley, on the Colorado
River in Riverside County, California, and you have a condition
down there where you have varied crops; you have melons, cotton,
seeds of all sorts, and where 40 acres would do in one place it might
require 160 acres in another place.
Mr. ELAINE. That is provided for in section 13, that the maxi-
mum area shall not exceed 160 acres.
Mr. ARENTZ. I would say that that was fair, 160 acres.
Mr. BLAINE. But of course the Secretary of the Interior may
reduce it even below 40 acres. I might say to you that in the State
of Washington, under the Sunnyside Canal, the average size of the
farms is 22 acres, and they are going down, not going up in size.
There is, for example, in my State over in Dr. Summers's district,
one of the greatest wheat counties in the world, and they tell me
that the size of the farms there is now approximately 300 acres,
against 22 acres in the Yakima Valley under irrigation.
The CHAIRMAN. Is it not true that the smaller the farms are
made the better the yield per acre '(
Mr. BLAIXE. Much better. It means intensive cultivation. I
have traveled in Egypt, I have traveled in China and Japan, and in
Egypt they have something like 5,000,000 acres of cultivated land
supporting a population pretty close to 13,000,000 people, and I
think it is every two acres that has some sort of an animal upon it
other than a human being.
The CHAIRMAN. That is all due to intensive farming.
Mr. BLAIXE. It is very intensive. In China and Japan it is the
same way. There they have intensive cultivation.
The CHAIRMAN*. It has been suggested that we permit Mr. Blaine
now to finish his statement and men ask him questions, if we have
time, afterwards.
Mr. HUDSPETH. Are you taking the bill by sections ?
Mr. BLAIXE. Yes, I was starting with section 1. Now section 3
has already been covered.
In section 4 it is provided that the bonds to be issued shall be
ample in amount to cover the estimated cost of the project, and that
amount may include, in the discretion of the Secretary of the In-
terior, the interest that would accrue during the period of construc-
tion. I am inclined to think that that is a very wise provision,
because we of the West realize that the trying time in reclamation
is when the farmer first goes on his land, the first few first years of
his efforts. That land has nothing upon it but sagebrush and a
little bunch of grass. It will produce very little if any grain. The
farmer goes into the desert and he builds from the sagebrush roots
up, and he must have all the money he can get hold of in order to
carry him through until he has got a productive farm. Xow, just
as soon as those farms commence producing, they produce so a bun-
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 27
dantly that the farmer from that time on thrives, and what he is
able to do thereafter is well known to the western prople. So dur-
ing this period of construction the bond interest should be capital-
ized, and under this bill it can be capitalized. There is a provision
in here for adding 2 per cent to the estimated cost of the project
for commission on the sale of the bonds.
Mr. SUMMERS. There is just this, Mr. Elaine: You say, "The
balance of the 2 per cent, if ^ny, to be placed to the credit of the
reclamation fund." Do you mean in that particular district? You
mean the local reclamation fund, do you not ?
Mr. BLAIXE. No, I do not. I mean that there are big districts
and little districts, and in some cases it will take more than 2 per
cent to effect a favorable sale of bonds; in another district it might
take less than 2 per cent. So I think 2 per cent on all the bond
issues would create a sufficient fund that we would have a very
favorable sale of the bonds of these districts.
Mr. SUMMERS. Your idea is that this should be cooperative with
all of these new districts I
Mr. BLAIXE. Yes, sir.
Mr. SUMMERS. But when you put it into the reclamation fund,
then wouldn't it go also to the old districts as well ?
Mr. BLAIXE. No, it would be in the new districts, the new enter-
prises.
Mr. SUMMERS. But when you put it into the reclamation fund, how
would you limit it to new districts ?
Mr. BLAIXE. Well, in a sense the money might be used in old
districts but I doubt whether it would go that way.
Mr. SUMMERS. I think it ought to be specific as to where it is
to go.
Mr. BLAIXE. Well, it is to go to the credit of the reclamation fund.
Of course it can be used, and we suppose it is going to be used, in
other projects; and 2 per cent, as I say, may be a little large in some
instances and not large in other instances, and so I think the per
<;ent should be fixed and not leave that to the Secretary of the Inte-
rior. If there is any surplus left in the reclamation fund it will help
out on other projects.
These bonds of the district are not turned over to the Secretary
of the Interior, but they are turned over to the Federal Farm Loan
Board to be held by that board.
Mr. HAYDEX. Have you consulted with the Federal Farm Loan
Board to ascertain whether they are willing to perform the duty
imposed by this section I
Mr. BLAIXE. No, I didn't think that was necessary, because they
are a creature of legislation and if the burden is conferred upon them
they must perform the duties.
Mr. HAYDEX. But it is customary, nevertheless, where legislation
is enacted affecting the powers or duties of any branch of the Govern-
ment, that the department or bureau be consulted before the law is
passed.
Mr. SMITH. I may say, though, at the last session of Congress when
we had similar legislation up, we had a conference with Mr. Lever
of the Federal Farm Loan Board, who was very deeply interested in
the legislation, and he indicated that he was perfectly willing to
come before the committee and discuss the measure.
28 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. HAYDEX. The way to ascertain that is. first, to have this bill
referred to the Federal Farm Laon Board formally by the chairman
of the committee for report; and second, to have some one authorized
to speak for the board to appear before this committee and express
their views on the measure.
Mr. ELAINE. I judge now that you want 'to find out from them
whether in their opinion this is workable (
Mr. HAYDEX. Exactly.
Mr. BLAIXE. Well, yes: in that sense they ought to be conferred
with, but I caught your question in the other form. But as far as
conferring with them to see whether this is a workable provision, I
heartily agree with you.
The CHAIRMAN-. VVell. we will have plenty of time to confer with
them and give them a hearing.
Mr. BLAIXE. Now this bill further provides that in case -
Mr. SIXNOTT (interposing). What section are you on I
Mr. BLAJNE. I am down now in the latter part of section 4. page 4.
Mr. SIXXOTT. Before you leave what you were talking about, I
want to call your attention to the language in section 4, lines 14 and
15, ''and the project and contract or contracts shall have been exe-
cuted by the parties, the district or districts shall, pursuant to such
contract or contracts, deposit the bonds with the Federal Farm Loan
Board," and so forth. Who are those parties referred to, and what
is the contract or contracts referred to ?
Mr. ELAINE. Well, you see. he may have a project where it extends
into two States, so that there might be two contracts as to that one
project. Districts might be parts of two States, subdivisions of two
States.
Mr. SIXNOTT. Does your word "parties" embrace districts ?
Mr. BLAIXE. Parties means districts: yes. sir.
Mr. SINNOTT. That ought to be made clear, because this section
4 what has gone before it presupposes a contract already entered
into by the Secretary, and I wondered why you repeat that and what
that '' contract " referred to ? There seems to be sort of a gap or
hiatus in there, so some ambiguity that I don't just understand.
Mr. BLAIXE. Well, it goes back to the contracts -
Mr. SIXXOTT (interposing). It says in the first of the section." That
when the district shall have authorized the issuance of bonds to be
approved by the Secretary.'' and so on, and before it presupposes the
contract having been entered into: then you seem to run into another
contract down here that I don't understand.
Mr. BLAINE. There may be some unnecessary language in there.
Mr. SMITH. What line is that '(
Mr. SIXXOTT. That is lines 14 and 15.
Mr. HAYDEX. The same is true about the term '' project" in line 15,
" and the project shall have been executed by the parties." It is not
clear as to what that term means.
Mr. SINNOTT. You say '* contract or contracts shall have been exe-
cuted by the parties." You use the word here, Mr. Elaine, as a
minor subdivision; then you seem to jump to a district: then you
seem to jump to a project. It seems to me that ought to be cleared
up. Of course I know, colloquially speaking, what you mean by a
''subdivision" or "minor subdivision" of a State, but I don't know
whether that is a legal term of not. Of course, we all know what an
DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES. 29
irrigation district is, and wherever you use the word " district " in
this bill I assume you mean an irrigation district I
Mr. BLAIXE. An irrigation district, yes.
Mr. SIXXOTT. It ought to be changed to that, and we ought to avoid
any ambiguity, such as a phrase "minor subdivision."
Mr. BLAIXE. I suppose vou will have an executive session of the
committee that will take that up.
Mr. SIXXOTT. I did not know but what you had some particular
object in using that phraseology.
Mr. BLAIXE. Xo; I think it is just an unnecessary use of the term;
in fact, there has been some repetition here.
The CHAIKMAX. I think it needs some clearing up, but as Mr.
Elaine suggests, we can take that up in executive session.
Mr. SIXXOTT. I just wanted to get his ideas as we go along, because
he may have had something in mind that we don't grasp.
Mr. BLAIXE. Yes; but what was in my mind all the way through
here in every instance was that it is going to be an irrigation district.
The CHAIRMAN. Let me suggest, there is a meeting, I understand,
of the Public Lands Committee to-morrow, Mr. Sinnott?
Mr. SIXXOTT. Yes.
The CHAIRMAN. And we want to afford Mr. Blame an opportunity
to go over this whole bill this morning. We may have to call him
again, and we can not tell him how often, but I think we should get
over it in a general way this morning, and I just suggest, Mr. Blaine,
that you so gauge yourself on these different sections that you can
cover this by noon.
Mr. BLAIXE. Yes: I think I can do that.
Mr. SIXXOTT. I had some questions that I wanted to ask him on
the various sections as he came to them.
Mr. HAYDEX. I think it is important, Mr. Chairman, that as we go
along we clear up any ambiguity that may exist, so that we can begin
where we left off when the next' hearing is held.
Mr. BLAIXE. Xow the bill shows that the Secretary shall call for
bonds in ample amounts to cover the estimated cost of the project.
Mr. SIXXOTT. Are you on section 4 ?
Mr. BLAIXE. I am' still in the latter portion of section 4, page 4,
where on the completion of projects, if there is found to be an excess
of bonds issued, the bonds in excess of the bonds necessary to cover
the projects are to be turned back or to be canceled, and in case of a
deficiency the district may be called upon to issue additional bonds,
or, at the discretion of the Secretary of the Interior, the deficiencies
shall be made up by an extra assessment upon the project.
Mr. SIXXOTT. Right there "at the option of the Secretary, be
added to the tax or assessment roll."
Xow. the question occurs to me whether there is a complementary
statute in most States that will make that workable, because you
give the Secretary the option to have that added to the tax or assess-
ment roll, and I wonder if the State taxes are broad enough to permit
that.
Mr. BLAIXE. I am satisfied, Mr. Sinnott, that under the provisions
of this bill some of the States will have to modify their present recla-
mation district laws, because in several of the States the general
power of taxation is not yet vested in irrigation districts. In my
State it is an open question. It has not been passed upon by the
30 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
supreme court. But if this bill goes through and becomes a law. I
am inclined to think the supreme court of my State will hold that
the irrigation districts have the general power of taxation, because
the State interest would be back of such a decision. Xow. in some
States I doubt whether you have any broad, comprehensive district
laws that will cover that.
Mr. SIXXOTT. I think in most of the Western States they have
pretty broad laws contemplating cooperation with the National Gov-
ernment, but I didn't know whether the laws were broad enough to
embrace this option that is vested in the Secretary.
Mr. BLAIXE. If not, we will have to amend our State laws to con-
form with it, unless you wish to cut that clause out and say it shall
be covered by additional bond issues.
Mr. SIXXOTT. I didn't know whether you had in mind some State
statutes and how far they have gone along that line.
Mr. BLAINE. No; but I am laboring under the impression that in
pretty nearly every one of our States we will have to have some addi-
tional legislation, or if not additional legislation, we will have to have
friendly interpretation of the existing laws by our courts.
Mr. SINNOTT. You know some States Western States have in
their constitutions a restriction that no law shall be passed the taking
effect of which shall be made to depend upon any authority except
as provided in the constitution of the State.
Mr. BLAIXE. Will you repeat that (
Mr. SINNOTT. I say that some States have a constitutional restric-
tion that no law shall be passed the taking effect of which shall be
made to depend upon any authority except as provided in the State
constitution.
Mr. HAYDEX. That is, the legislature could not delegate to a muni-
cipal corporation, such as an irrigation district, the power to tax *
Mr. SIXXOTT. No: to delegate to any authority, except as pro-
vided in the State constitution, to say when the law shall take effect.
Mr. STMMERS. That is in the constitutions, you say '(
Mr. SIXXOTT. Yes.
Mr. LEATHERWOOD. Why wouldn't it be simpler, to save time, to
cover the deficiency by bonds than it would be to try to get seven or
eight States to straighten out their State lav.
Mr. SIXXOTT. It reads that no act shall be passed the taking effect
of which shall be made to depend on any other body, either inside
or outside the State, except as provided in the State constitution.
The CHAIRMAX. That is against the delegation of legislative power.
Mr. SIXNOTT. Yes.
Mr. HUDSPETH. That is in the constitution of Texas.
Mi - . LITTLE. Does that mean that if the State made a law, nobody
outside of that State could make a law controlling that subject '.
Mr. SINNOTT. No; I am not clear just how far it goes, but it
seems to me that the wording of that constitutional restriction might
place some embarrassment upon the Secretary in adding this to the
tax roll.
Mr. LITTLE. Where is that constitution in force \
Mr. SIXXOTT. In Oregon; and I think possibly in the State of
Washington, too.
Mr. LITTLE. The State of Washington's constitution can not
govern any other State's laws.
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 31
Mr. SIXXOTT. Oh, no; but then there would probably be land in
Oregon that would probably want to come under the provisions of
this bill.
Mr. BLAIXE. If the power didn't exist to add it to the tax roll,
then it would have to issue bonds.
Mr. SIXXOTT. Well, you could make that alternative, but here the
option is in the Secretary. You could make it alternative instead of
optional.
Mr. BLAIXE. Yes. Now, section 5 is only as to the denomination
of the bonds.
Mr. SIXXOTT. You think that bond interest is high enough, not
exceeding 5 per cent ?
Mr. BLAIXE. Yes: I think that interest is high enough. Under
this bill a total of 250,000,000 will be appropriated 820,000,000 the
first year, 835,000,000 the second year. 845,000,000 the third year,
and 850,000,000 each year thereafter till the total 8250,000,000 has
been used and we will be some time spending the $250,000.000.
Xow. it is probable that it will be four or five years before there will
be any sale of these district bonds, before the projects are completed,
and I am of the opinion and I think it is the consensus of opinion
in the United States that interest within the next five years will
drop.
Mr. SIXXOTT. But most of the bonds in irrigation districts have
been sold at 6 per cent in the past and at a great discount.
Mr. BLAIXE. Very true; but in that instance, Mr. Sinnott, the
security had not been created. Money was loaned to create a secur-
ity: in this instance, before these bonds are sold, the property within
the district must have twice the value of the outstanding bonds.
So, I believe that as between a security in existence and one that is
to be created by the money loaned, that 1 per cent difference in the
rate of interest would be reasonable. That is only a matter of judg-
ment, and that is my judgment.
Mr. SMITH. It is important to keep the interest as low as possible*
in order not to burden the settler too much.
Mr. BLAIXE. Yes: you must not burden him too much.
Mr. SMITH. We must offer every encouragement to the man to go
on the land.
Mr. BLAIXE. Yes, sir.
Mr. SUMMERS. It is possible State pride might enter in, in helping
to dispose of bonds that would mean development within certain
States.
Mr. BLAIXE. That is true; and we have allowed 2 per cent on sales.
It costs money to sell bonds. That is provided for in this bill. So
that really adds to the rate of interest.
Mr. HUDSPETH. It would make the rate of interest 7 per cent, then ?
Mr. BLAIXE. Xo; it is only 2 per cent on the gross amount. The
interest runs throughout the years, and this is calculated on the
gross amount.
Mr. HUDSPETH. It would be 7 per cent the first year.
Mr. BLAIXE. Yes; if you want to calculate it that way.
Mr. SIXXOTT. What do you think of semiannual interest ? A num-
ber of districts issue bonds with interest payable semiannually.
32 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. ELAINE. My experience in collecting money on contract* in
the State of Washington is that they always want to put off their
payments until they have sold their crops.
Mr. SINNOTT. You think it is best to have it coincident with the
sale of crops ?
Mr. ELAINE. I would; if I were regulating the bonds I would have
the interest payable after the crops are marketed, a certain time in
December the latter part of December or the 1st of January.
Section 6 is in regard to the sale of bonds. When the Secretary of
the Interior is satisfied that the property has twice the value oAhe
then outstanding bonds, he requests the Federal Farm Loan Board
to make an investigation to determine that fact, and if the Federal
Farm Loan Board upon such investigation finds that the property
within the district has twice the value of the outstanding bonds,
then the bonds are to be sold in the open market and the proceeds
of those bonds are to go into the reclamation fund to be used over
again. This bill is quite different from other bills in this regard,
most all of the other bills that have been drawn, so far as I have
observed them, have a provision for the sale of the bonds, the money
to go back into the General Treasury, but here we provide for this
money to go into the reclamation fund to be used over again.
The CHAIRMAN. In other words, you w r ant to preserve the reclama-
tion fund intact ?
Mr. BLAINE. Yes.
The CHAIRMAN. Then the money that is used for reclamation
keep it in a revolving fund ?
Mr. BLAINE. Yes. In other words, we are asking the Government
to help the reclamation in the West with a capital sum of 8250,000,000;
leave that capital sum for 20 years before it asks any of it back.
The CHAIRMAN. You wish that to supplement the present relama-
tion fund ?
Mr. BLAINE. Yes, sir.
The CHAIRMAN. And to become commingled with it, and old
projects as they pay into the fund: it all goes together in a ir.;
Mr. BLAINE.' Yes.
Mr. SINNOTT. Have you made any provision in the bill for using
the proceeds of these bonds that have been turned into the reclama-
tion fund ?
Mr. BLAINE. It tm at the end of that section ''to be used on
further projects." It is to go into that fund, and if it goes into that
fund, of course the fund can be used. There is provision in regard to
paying back the money to the Federal Treasury commencing in 1942.
Mr. SINNOTT. But you do not in this bill make any provision for
the reuse of the proceeds of the bond sales that have gone into the
reclamation fund, do you (
Mr. SMITH. In lines' 21. 22, and 23 it provides that it shall go into
the fund, and it would be apportioned under the general law.
Mr. SINNOTT. That is what I had in mind, whether you were
relying upon the general law to use this fund over again under the
general law. or whether you make a specific provision in the bill.
Mr. BLAINE. Well. I have been laboring under this impression,
that directing it to be covered into the reclamation fund, it can be
used when covered into that fund unless there is a limitation upon it.
Mr. SINNOTT. Then you are depending upon the general law lor the
use of that money ?
DEVELOPMENT OF AGEICULTUEE IN THE UNITED STATES. 33
Mr. BLAIXE. Yes, upon the general law. I may be wrong in regard
to that, but that is my idea.
Mr. SINNOTT. The question occurred to me whether it was necessary
to have a specific provision here.
Mr. BLAINE. If you would add a word of that kind, it would not be
amiss.
Now, prior to the sale of these bonds the interest will accumulate,
and whether paid or whether capitalized, that interest of course will
belong to the Government, but that interest will go into the reclama-
tion fund to swell the reclamation fund.
Mr. SINNOTT. You say here, " Prior to the sale of bonds the board
shall collect all maturing principal and interest." That is not
exactly clear to me. Is a district to pay the interest on the bonds
during construction ?
Mr. BLAINE. Yes, the district. There might be a case where you
would capitalize the interest during the course of construction.
Mr. SINNOTT. What do you mean by "capitalize the interest?"
Mr. BLAINE. Add it to the cost of the project.
Mr. SINNOTT. But this says that they shall "collect all maturing
principal and interest."
Now, I take that to mean, and all interest on the bonds that have
been put up to the Federal Board, that will not be sold in the ordinary
course of events for five years.
Mr. BLAINE. Yes.
Mr. SINXOTT. But there will be an annual interest on them ?
Mr. BLAINE. Yes; might be.
Mr. SINNOTT. Well, there probably will be, won't there ?
Mr. BLAINE. If it is capitalized during the course of construction?
Mr. SINNOTT. How are you going to get around that annual
interest '(
Mr. BLAINE. Well, if it is added to the principal, then there will
be no collection of interest during the course of construction, but
these bonds might be held after the period of construction.
Mr. SINXOTT. Section 5 provides for annual interest. I was
wondering how these two provisions harmonized.
Mr. SMITH. There would be no interest paid until after the bonds
are sold, as the interest due prior to that time would be added to
the original cost.
Mr. SINNOTT. There would be interest maturing each year.
Mr. BLAINE. Yes; it is capitalized during the period of construc-
tion; now your construction is finished; your interest then is running,
and it should be paid annually by the district to the Federal Farm
Loan Boards, and they should account for it.
Mr. AREXTZ. Up in your own district, Mr. Smith, the project
when completed in other words, when the dam was completed and
the water stored there were people close in on the best land that was
then in cultivation, but the project necessarily was not worth twice
the value of the bonds. Now, all those people who had their lands
under cultivation and were using water up to the time the value of
the land was twice the value of the bonds would have to pay interest,
so there may be a thousand or more who are paying interest for
two or three or four years up to the time the value of the land was
twice the value of the bonds, and that would be paid into the recla-
5666421 3
34 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
mation fund. Now, suppose that investigation and report to the
Secretary does not disclose that the land is worth twice the amount
of the bonds, what becomes of the bonds, are they still held as the
property of the Government ?
Mr. SMITH. The bonds are not offered for sale.
Mr. ELAINE. Yes: they are the property of the Government. The
Government takes the bonds in payment for the work, and the Gov-
ernment owns the bonds, and this sale here is a sale of Government
bonds I mean of Government-owned bonds.
Mr. SINXOTT. I am afraid we might be subject to a little criticism,
and I just want to develop this idea. Now, unless the board finds the
land is worth double the value of the bonds, the Government will be
holding the bonds and holding the sack. Is that right ? Is that
criticism valid ?
Mr. SMITH. You will be collecting the interest.
Mr. ELAINE. You would be collecting the annual interest. The
annual interest would be paid to the Government by the district .
Mr. LITTLE. How long will the interest be paid out of these bonds ?
Mr. ELAINE. During the period of construction.
Mr. LITTLE. For how long will they pay the interest out of the bond
capital >
Mr. ELAINE. During the period of construction.
Mr. SMITH. About three years generally.
Mr. LITTLE. Did you ever hear of any other transaction in which
they paid the interest on the bonds out of the sale of the bonds ?
Mr. ELAINE. Yes, sir.
Mr. SMITH. They are not paying it out of the sale of bonds; they
figure up the interest that would be due during the period of con-
struction and add it to the original cost.
Mr. LITTLE. They pay the interest on the bonds from the proceeds
of the sale of the bonds.
Mr. ELAINE. No.
Mr. LITTLE. Oh, yes; they do. That is what it amounts to. The
interest on these bonds is estimated to be paid out of the proceeds of
the sale of the bonds. Don't you think there would be some criticism
of that ? Irrigation is not popular in the House, and some fellow will
be sure to get up and make that statement, and how are you going
to answer it ?
Mr. ELAINE. Well, there are loans made on private enterprises
where the interest during the period of construction is capitalized.
Mr. LITTLE. Where ? Name them.
Mr. ELAINE. yVe\\, there are building loans of that character.
Mr. LITTLE. Where ( Name one of them.
Mr. ELAINE. I don't know as I could name one of them now.
Mr. LITTLE. Well, if I were defending this proposition I would want
you to supply me with some such incidents. If some one asked that
question I would like to be fixed to answer it.
Mr. ELAINE. I can get you that information, Judge Little, in a very
definite form.
Mr. LITTLE. I wish you would; something that will enable us to
protect you on the floor.
What does this mean I It says when the validity of such bond
issues shall be confirmed or shall be acceptable to the Secretary.
Confirmed by whom ?
Mr. ELAINE. Confirmed bv the courts.
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 35
Mr. SINNOTT. Most State laws, Col. Little, have a provision for the
confirmation of irrigation district bonds,
Mr. LITTLE. How do we know that that is what that means ? Page
4 says: ''When the validity of such bond issue shall have been
confirmed or shall be acceptable to the Secretary." If that means
by some local court, and if the decision of the court would have to be
confirmed on appeal to the State supreme court, hadn't you better
put a sentence in there covering that (
Mr. BLAINE. If I may read a section from page 3:
That the validity of the organization of the district and of the bonds through a
confrmation by the court has been determined, or the time limit in which the
validity of such aistrict and bonds can be assailed has expired.
Mr. LITTLE. How long is that in one State and how long is it in
another ?
Mr. BLAINE. It is fixed by State statute.
Mr. LITTLE. Each State fixes it? I don't think you are very clear
in your statement. If a person reading that didn't know anything
about it, any more than I did when I came in, it wouldn't mean any-
thing to him. I think in 3 and 4 you ought to have a little arrange-
ment there that simply says in effect that when the thing has been
confirmed by the court under the laws of the respective States
some phrase'like that.
Mr. BLAINE. I see. Have you drainage laws in your State ?
Mr. LITTLE. Yes.
Mr. BLAINE. Haven't you got a provision of that kind in your
drainage district law ?
Mr. LITTLE. I don't think so. No.
Mr. BLAINE. A provision confirming the bonds if no objection is
raised within a certain time ? That provision is found in a great
many drainage laws.
Mr. LITTLE. Not in purs.
Mr. HUDSPETH. It is valid in my State, Mr. Elaine, when the
attorney general approves the bonds. That is the law there.
Mr. LEATHERWOOD. The legality is not susceptible of attack after
that?
Mr. HUDSPETH. No, sir; not after the attorney general of the
State approves the bonds. I suppose that would mean a confirma-
tion under this law.
Mr. BLAINE. Probably, although this says, "By the court" in
here.
Mr. LITTLE. I should be a little afraid that any confirmation of
that kind would be a little bit open to attack. It might be that it
would legislate a man out of some rights, possibly.
Mr. BLAINE. We find that a very wise provision in the issuance of
district bonds.
Mr. HAYDEN. There was a decision about a year ago by the Su-
preme Court of the State of California on this very point, that it
would be well for you to examine. The provision of the California
law, as I remember it, was that someone representing the irrigation
district could take the case up to the supreme court, and the supreme
court was expected to pass on it, when really he was not a party in
opposition to the bond issue but was favorable to it. As I remember
the case, the court held that they would not pass judgment in ad-
vance on such a case but that somebodv who had an adverse interest
36 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
had to bring the suit, and then there would really be an issue that
the court could decide.
Mr. SINXOTT. In other words, it was a moot case.
Mr. HAYDEX. Yes.
Mr. LITTLE. You could not make a law in any State that would
estop any man from asserting any right he has had in the courts.
Mr. SINXOTT. They have a statute of limitations in most of these
States.
Mr. LITTLE. You can not keep a man from having his day in
court.
Mr. SINXOTT. This act provides for both the reviewing by the
court and for the statute 01 limitations to have run.
The CHAIRMAN. Remember that the confirmation is provided and
that the Secretary is to be satisfied. I should say the Secretary
should be satisfied when it was confirmed, when the court settles it.
You should not be required to go further than that.
Mr. SIXXOTT. Now section 2, paragraph F.
Mr. BLAIXE. I just read that. I think it has been practically
upheld there is a statute of limitations in every State.
Mr. SINXOTT. Well, that can be cleared up.
Mr. LITTLE. I think you ought to be prepared to meet that ques-
tion on the floor.
Mr. BLAIXE. I think you are right.
The CHAIRMAN. While we are talking about it, hi section 4, line
14, the language is, "been confirmed or shall be acceptable to the
Secretary." I think that ought to be cleared up.
Mr. LITTLE. That is what I called attention to.
The CHAIRMAN. I did not get your idea to start with. I noticed
that some time ago.
Mr. BLAIXE. That would seem to be a little bit out of harmony
with the other, unless we interpret that in this way, that he shall be
satisfied the statute of limitations has run. That would make it
acceptable, probably. I think confirmation is the best thing.
Mr. SMITH. On page 4, line 4, after the word "confirmed," if you
will put in the words "by the court."
The CHAIRMAN. Yes; that would be all right.
Mr. LITTLE. I don't believe that phrase would entirely cover it.
Mr. LEATHERWOOD. Would you strike out then "acceptable to the
Secretary?"
Mr. BLAIXE. In a good many States there is no provision for the
confirmation, and it might be some time before laws could be passed,
I believe leaving it to be acceptable to the Secretary would broaden
the pro visions of the act.
Mr. LEATHERWOOD. Do I understand that in some cases the issue
without any confirmation would be acceptable ?
Mr. BLAINE. By lapse of time. There might be a provision in the
law that the validity of the bonds in question would be deemed to be
a binding obligation on the district after a certain length of time.
We have that in the law of our State. The law provides for confirma-
tion in court, but if nobody asks confirmation in court after a certain
length of time the validity of the bonds can not be questioned. That
has been upheld as proper legislation.
Mr. SIXXOTT. Do you think it wise to tie the Government in the
disposal of the bonds to the time when the land is worth double the
value of the bonds ?
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 37
Mr. ELAINE. I do.
Mr. SLNXOTT. Why restrict the Government in the sale of bonds ?
Mr. BLAIXE. I don't believe that the Government ought to make
the mistake of selling a bond issue and the bonds not be readily paid
by the district. I wouldn't want a fall down in the prompt payment
of these bonds after they have been sold by the Government. The
board might be able to sell them before the property in the district
was worth twice their* value, sell them in flush times, and then dull
times might set in and there might be a default, and it would give a
black eye, so to speak, to the sale of further bonds.
Mr. SINNOTT. In the meantime the Government's money has been
paid out and it has not been reimbursed.
Mr. BLAINE. Yes, but while the Government doesn't in any way
back these bonds that is. the Government doesn't guarantee the
bonds -I think the conduct of the Government should be such that
there would be no danger of the bond buyer losing a cent, because the
bond buyer will rely more or less upon the faith he has in the public
officials, the Federal officials.
Mr. HERRICK. Mr. Chairman, I would like to ask, are we going to
hold another hearing or. two on this bill before it is reported out.
The CHAIRMAN. Yes.
Mr. HERRICK. In that event, I would like permission to go now,
because I think I would like to be heard on the bill at the next
meeting.
The CHAIRMAN. We will have several hearings on the bill.
Mr. HERRICK. Then I would like to be heard at the next time.
Mr. SIXNOTT. We are taking up the sections seriatum on the bill
now.
Mr. BLAIXE. Now, section 7 merely extends the authority of the
Federal farm loan act, an act amendatory, supplementary thereto
this act here. Now, this bill has been passed upon by several lawyers
more or less familiar with that other act, and they seem to think this
provision is satisfactory.
Mr. SINNOTT. I want to know in relation to this just how that is
workable and what provisions of the farm loan act you contemplate
invoking by virtue of section 7.
Mr. BLAINE. I prefer that you hear from Judge King on that
matter.
Mr. SIXNOTT. I spoke to the judge the other day, and I told him
the committee would want to know that, because somebody has got
to explain that on the floor.
Mr. LITTLE. Mr. Blaine, most of the confusion in the interpreta-
tion of the laws of the United States is such legislation as that section
there. The law is going to be the same as it was somewhere else and
"acts amendatory of or supplementary thereto." It seems to me if
I were handling it I would just put in 'there what it is that you want
to say.
Mr. BLAINE. That might be the better way of doing it, but on that
section I would rather you would listen to Judge King than to me.
Mr. HAYDEN. I am very much inclined to agree with Mr. Little.
To say that all the authority contained in the Federal farm loan act
and ''acts amendatory thereof and supplementary thereto" is hereby
extended for what purpose ? To provide for the discharge of the
duties of the Federal Farm Loan Board as specified herein. It
38 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
would be much better to say directly that the Federal Farm Loan
Board is authorized to perform any and all acts necessary to carry
out the provisions of this act, and stop right there.
Mr. BLAINE. Now. section 8 provides "that all balances of money
received under provisions of this act not otherwise disposed of shall
be covered into the reclamation fund." That is only a grab-net
clause to provide for any funds that might come into the fund.
Mr. SINNOTT. What do you mean by the word " balances" ?
Mr. BLAINE. We have used that as a general term, or we might use
the phraise "all moneys received under the provisions of this act."
We might strike out the word "balances" and make it " all moneys. "
I don't see any necessity for using the word "balances."
Mr. SINNOTT. You think you might strike out the word " balances " ?
Mr. BLAIXE. Yes, sir; and say " all moneys."
Section 9 provides that when the indebtedness due to the United
States has been discharged, unless otherwise provided, the control
of the district shall pass into the hands of the district.
Mr. HAYDEN. What is meant by the words "provided therein"?
To what does "therein" refer ?
Mr. LITTLE. Now, that word "contract," why don't you put that
expression at the end of the section instead of where it is ? That
should read: "When the indebtedness of the United States under the
contract for construction has been discharged the management shall
vest in the district, unless otherwise provided in the said contract."
That is what you are trying to say; why don't you say it?
Mr. BLAINE. Well, we can do tbiat.
Mr. SINNOTT. If you give the Secretary any more authority to
"otherwise" provide in the contract, you don't set forth the terms of
the contract between the Secretary and the district, do you ?
Mr. BLAINE. Unless there is something in the contract that would
withhold the possession, it would go to the landowners under this
provision.
Mr. SINNOTT. Now where is the provision as to the terms of the
contract the Secretary may enter into ? What could he do in that
contract ?
Mr. BLAINE. I think under the section here he would have power
to provide that it should be turned over. There might be some reason
why it should not be turned over when it is paid for.
Mr. SINNOTT. Where is the provision in the bill authorizing the
Secretary to make the contract ?
Mr. BLAINE. That goes way back to the first part of the bill. But
it is not specifically mentioned that he shall hold possession after the
bonds are paid 9r sold by the Government, rather.
Mr. SINNOTT. In section 2 it says: "may enter into a contract with
a district as herein provided." May entermto a contract to do what ?
Is there something tied into that ?
Mr. BLAIXE. I don't think specifically as to withholding possession
of the project after the Government has sold the bonds.
Mr. SINNOTT. I think you ought to provide what that contract is
that the Secretary is going to enter into.
Mr. BLAINE. I don't think specifically as to withholding possession
of the project after the Government has sold the bonds.
Mr. SINNOTT. I think you ought to provide what that contract is
that the Secretary is going to enter into.
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 39
Mr. BLAIXE. Of course, he is authorized to approve the contract.
Mr. SIXXOTT. He has authority to enter into a contract with the
district for its construction, and that is all. He is not authorized
to retain the management or control, or anything of that kind. Of
course, under the reclamation act he is.
Mr. BLAIXE. And we bring the reclamation provisions of the
reclamation act into this law, so far as it is not inconsistent with the
provisions of this bill. Now, Judge Little may think that that ought
to be cleared up.
Mr. LITTLE. I did not catch what you said there.
Mr. BLAIXE. I say, we refer later on to the provisions of the
reclamation act, as we have to the Farm Loan Board.
Mr. LITTLE. Yes, I find that there is an immense amount of
trouble and confusion in those things, when you could just as well
repeat the language. Now, take this section 10, have you said
what you want to say, " That upon default of the payment of principal
and interest" to mean "or interest," don't you?
Mr. BLAIXE. Yes, that is a misprint. It should be "principal
or interest."
Mr. SIXXOTT. You think that section 9 should be cleared up,
then ? I want to make a check on it.
Mr. BLAIXE. Yes.
Mr. HAYDEX. I think that we had better follow the form con-
tained in the reclamation law on this subject, then we are on safe
ground.
Mr. SIXXOTT. I think so, too.
Mr. BLAIXE. Now, section 19, do you think that adds anything to
the authority of the Secretary of tlie Interior ?
Mr. SIXXOTT. That is an omnibus provision that is in all bills.
Mr. BLATXE. I just wondered whether that would not strengthen
it?
Mr. SIXXOTT. He would not have authority to enter into any
other kind of contract than the contract he is permitted to enter
into under this bill.
Mr. BLAIXE. That can be cleared up very easily.
Mr. SIXXOTT. You say in section 18 that the money shall be
expended under the terms and provisions of the act, of the reclama-
tion act, but that is a pretty restrictive authorization. It merely
relates to the expenditure of the money.
Mr. BLAIXE. Section 10 provides that in case of default in inter-
est that ought to be "principal or interest" in that case the
board may declare a default the Federal Farm Loan Board may
declare a default.
Mr. LITTLE. Is the Federal Farm Loan Board in the same position
as this board is here, that is, they don't ever foreclose any of theirs;
does the Farm Loan Board ever foreclose ?
Mr. BLAIXE. Do they ever foreclose?
Mr. LITTLE. They have millions of dollars of irrigation water
claims out, and they have told us several times that they have not
foreclosed any of them, that they have never done anything about
it. What does the Farm Loan Board do about it?
Mr. WILLLA.MSOX. They foreclose the same as any other mortgage
holder.
Mr. LITTLE. They really do it, do they ? Do they go into the State
courts ?
40 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. WILLIAMSON. They usually foreclose in the State courts.
Mr. LITTLE. What do they do about cost bonds?
Mr. WILLIAMSON. I don't know about that.
Mr. SUMMERS. It provides that any owner of bonds may take pro-
ceedings for collection if the board doesn't act.
Mr. SIXNOTT. After default.
Mr. ELAINE. The Federal Farm Loan Board has power to declare
a default.
Mr. LYON. Is it your idea to make every man's land responsible for
the payments due by every other man's land ?
Mr. BLAINE. Yes. sir. These bonds, as somebody has stated, "will
reach the last faithful acre."
Mr. LITTLE. Are you going to sell one man's property to pay
another man's debts ?
Mr. BLAINE. That is done all the time.
Mr. WILLIAMSON. They sign an agreement before they go in.
Mr. LITTLE. It can't be done.
Mr. HAYDEN. It can be done.
Mr. LITTLE. The Supreme Court of the United States has held the
other way.
Mr. SMITH of Idaho. It is done in the case of a municipality, is
it not ?
Mr. LITTLE. They can't do it.
Mr. BLAINE. The law comes in.
Mr. LITTLE. That doesn't make any difference, you can't take a
man's property if he waives right to his land, of course you can.
Mr. SIXXOTT. Before they enter into a contract to build the project
they put up bonds, and the bonds are a lien upon all the lands in the
district.
Mr. LITTLE. That can be decided at the proper time, but that is
the difficulty in all this legislation. Does this apply only to new
projects (
Mr. HAYDEN. Entirely to new projects.
Mr. LITTLE. Well, that might be all right.
Mr. HAYDEN. This provision in section 10 is a general provision.
My recollection was that in the original bill you had a more detailed
and specific method of action in cases of default: that is, you required
the authorities of the State to levy the tax; if they did not levy it,
that the United States might step in and force them to do it through
some proceeding in the Federal Court or otherwise. In modifying
this in these general terms, do you think you still accomplish every-
thing you want to do ?
Mr. BLAINE. I might say to you that Mr. Hamele of the Reclama-
tion Service, has a provision for foreclosure in the Federal Courts.
He will probably present his clause here.
Mr. SIXXOTT. He has what ?
Mr. BLAINE. He has a clause for foreclosure in the Federal courts.
Mr. SIXXOTT. He has an amendment for th>> (
Mr. BLAINE. Yes at least, in talking with him he seemed to think
that should be provided for. That was in the old bill and probably
came from Mr. Hamele before, did it not, Mr. Smith?
Mr. SMITH. No; I think that came from Judge King. I do not
think Mr. Hamele was here at that time.
Mr. LITTLE. Mr. Sinnott, where is that provision about a man
signing up* before he comes in ?
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 41
Mr. SINNOTT. That is the district.
Mr. LITTLE. Which provision is it, where a man signs away his
rights ?
Mr. BLAINE. Eight in the first section.
Mr. SINXOTT. The district puts up its bonds.
Mr. LITTLE. Where is it?
Mr. SINNOTT. Section 4 and following on. They put up their
bonds first.
Mr. BLAINE. You have in mind, Judge Little, that a given number
of people or landowners can force a district organization and include
in it the land of some man who doesn't want to go in ?
Mr. SINNOTT. On page 4, section 4, it provides: "When the bonds
shall have been deposited and the funds made available as herein
provided the Secretary shall be authorized to proceed with the con-
struction of the project."
The district can put up its bonds; that is all right, but you can't
bind any man to pay another man's debts. He has got to bind
himself.
Mr. SIXXOTT. All the land in the district is bound to pay the bonds
of the district.
Mr. LYOX. The farm loan act, as I understand it, is that way.
Each man signs up, and every man's property is responsible for the
other man's debts.
Mr. HAYDEX. Let me give you another illustration, Judge Little:
Take the case where a special road district is organized in the State
of Kansas to build a particular section of road. On petition of a
majority of the owners of the abutting land the local authorities
authorize them to organize a district and issue bonds, and they com-
pel the minority, who are opposed to the construction of the road, to
bear their share of the burden of construction. Exactly the same
principle is applicable here. It is done over and over again on
roads, street improvements, drainage districts, and irrigation districts
Mr. SINNOTT. Probably this is what Judge Little has in mind:
Now, suppose there is a bond issue of a million dollars on a district, a
road district, or any kind of a district, and I own 160 acres of land;
my- assessment for this year, say, is $100; I pay that. John Doe,
living alongside of me, does not pay it; his land is sold for $50, say;
how are you going to get the balance of the $50 ? Is that what you
have in mind ?
Mr. LITTLE. Yes; the same proposition that I have been arguing
here for three or four years. These bonds, though, merely go to
make the general project, don't they?
Mr. SIXXOTT. Yes.
Mr. LITTLE. I believe you have gotten by my objection here.
Mr. HAYDEN. For comparison, I would like to have inserted in the
record section 6 of a bill that was introduced in the last Congress to
provide for the establishing of irrigation districts, which covers this
question of default. It reads as follows :
SEC. 6. That upon default of any installment of the principal or interest of any bond
deposited with the Secretary of the Treasury in accordance with the terms of this
act, the said Secretary may declare the entire amount of such bond issue in default
and thereupon he shall call upon the State under the authority of which said bonds
were issued, through any of its authorized agencies or officers, to levy and enforce the
payment of any taxes, forced contributions, or special assessments 'necessary to pay
42 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
the sums due to the United States, and upon failure of the State authorities so to do
the Secretary of the Treasury shall cause suit to be instituted in the name of the United
States, and take such legal action as may be necessary to enforce the assessment and
collection of such taxes for the payment of the amount of principal and interest in
default or the entire amount of such bond issue, principal and interest. It shall be
the duty of the Attorney General to prosecute such suit, and any United States dis-
trict court for the district in which the lands affected by this act.' or any part thereof,
are situated, is hereby vested with jurisdiction to enforce the provisions of this ac .
The CHAIRMAN. We will have to adjourn now, gentlemen.
Mr. SINNOTT. When are we going to hear Mr. Elaine ?
The CHAIRMAN. We can not tell certainly. There is another bill
in particular that there is a great demand for, that we want to dis-
pose of, but we will give Mr. Elaine further hearing as soon as we
can.
Mr. ELAINE. Mr. Chairman, probably next Friday President Gray
of the Union Pacific and some of his officials will be down here to
testify before the Senate committee, and could you arrange a hearing
soon after that Senate hearing, so that they can be heard I
The CHAIRMAN. Yes; we will arrange that just as quickly as
possible.
Mr. SINNOTT. I suppose what he wants to be heard on is the
general merits of the proposition, not the bill.
Mr. ELAINE. The points we are asking Mr. Gray to testify on is
the lack of uniformity in density of traffic along these transconti-
nental roads, and the character of the products produced in the
West and where they are marketed.
Mr. SINNOTT. I would like to get through with Mr. Elaine on the
phraseology of the bill, so that if we discover anything that should
be amended, we can take it up with the department.
You haven't asked for a report on the bill, have you. judge?
The CHAIRMAN. Yes; we asked for a report a good while ago and
have not received it.
Mr. SIXNOTT. I would like to have here the statements complete,
so that we could present some of these matters to the department
and clear them up.
The CHAIRMAN. When the report comes I anticipate it will make
some pretty valuable suggestions on that line, and then our dis-
cussions here will bring out others.
The committee will now stand adjourned, and we are very much
obliged to you, Mr. Elaine.
(Whereupon, at 12.05 o'clock p. m., the committee adjourned.)
COMMITTEE ON IRRIGATION OF ARID LANDS,
HOUSE OF REPRESENTATIVES,
Wednesday, May 25, 1921.
The committee met at 10.30 o'clock a. m., Hon. M. P. Kinkaid
(chairman) presiding.
The CHAIRMAN. The committee will come to order. Mr. Elaine,
you may proceed with your statement.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 43
STATEMENT OF MR. E. F. ELAINE Resumed.
Mr. BLAIXE. I will call attention to section 11 of this proposed
bill, which provides that the unentered and unpatented lands of the
United States which may fall within a district are to be sold.
Since going over this bill I might call attention to one matter that
has been discovered, and that is that under the law of 1916 we can
not put Government lands within a district unless 50 per cent of all
the land is privately owned. So it is probable that this section ought
to be amended in some way so that any amount of publicly owned
land may be thrown into a district. I know of no reason why a solid
block of Government-owned land should not be thrown into a district
and bonds be issued and the bonds become a lien upon the property,
because the property would be sold and be made subject to the lien
of the bonds.
Mr. HAYDEX. We might amend that act of August 11, 1916, to
provide that any public land included within an irrigation district
shall be subject to this act, notwithstanding that the district may
contain more than a majority acreage of public lands.
Mr. BLAIXE. Yes; it might be amended, or a provision could be
thrown into this act, just as might be thought advisable.
Mr. HAYDEX. I mean to amend section 11 of this bill to that
effect.
Mr. BLATNE. Yes; by a specific provision.
Mr. AREXTZ. Of course, you would have to change the wording
here, because there wouldn't be any contract between unpatented
land and the United States Government.
Mr. HAYDEX. The theory of the act of August 11, 1916, was that
where an irrigation district was created and there was included in it
certain tracts of public land, that the action taken by the owners of
the private lands in forming the district would be binding on any
en try man who afterwards entered the public land. In other words,
the entryman did not have to make an entry unless he wanted to,
but when he did, he would be aware of the fact that the land was in
an irrigation district and he must assume the same obligation as the
owners of private lands who originally formed the irrigation district.
Mr. WILLIAMSOX. There would be difficulty should you get too
much Government land in any irrigated district as there wouldn't
be privately owned land there sufficient to make the project feasible.
Mr. BLAIXE. It would be sold to settlers, and all of these lands the
settlers have got to go upon them, because there are very few settlers
upon the sagebrush lands of the far West and the Mountain States.
Mr. WILLIAMSOX. I think it was done on the assumption that the
Government might not be able to dispose of enough of the Govern-
ment lands in order to make the project feasible. That is why it was
made 50 per cent, I suppose.
Mr. BLAIXE. Probably that is true, but if this was enlarged it
would be up to the Secretary of the Interior whether to undertake
any project or not.
Mr. WILLIAMSOX. It would be better, I think.
Mr. BLAIXE. Now, this section also limits the farm unit, the
maximum farm unit, to 160 acres or less, if the Secretary shall so
desire, under approved regulations as to residence and cultivation,
with a view to carrying out the purpose of making the land the
permanent home of a settler.
44 DEVELOPMENT OF AGRICULTURE IX THE UNITED ST.V:
Under the provisions of this bill the settlers are given 20 years in
which to pay for the lands purchased of the Government. There has
been a suggestion made that this period be limited to 10 years. The
price at which these public lands would be offered to settlers should
be generally very low, so on a small purchase price extending the
period over 20 years has been thought by a public official to be
rather against public policy and there probably will be an amend-
ment offered to change that from 20 years to 10 years. I just call
that to the attention of the committee at the present time.
Now, the other provisions there are similar to the provisions in the
present law in regard to default in payment and forfeiture, and also
in relation to the effect that no transfer by mortgage or lease shall be
valid without approval of the Secretary of the Interior. In other
words, the alienation of the land is controlled by the Secretary of
the Interior. Probably if we look into this we will see that to a
certain extent it will benefit the soldier.
There ought to be a little latitude, because we might get a soldier
on a piece of land and he would prove his unfitness as a farmer, and
it would be known that he was unfit, and probably the Secretary of
the Interior would confer a benefit upon him and upon the general
project by granting him leave to sell. But that is under, I believe,
existing law and probably will not be changed much.
Mr. HERRICK. Well, I don't wish to unduly butt in here where
there are so many gentlemen and every one wanting to say something,
but it might be tnat I could make a suggestion that might be of
value, and that would be this, that we put a clause in this act at an
appropriate place something like this now, I am only suggesting
the idea and leaving it to you gentlemen to perfect it, but a clause
to the effect that none of this land be sold to a man who is wholly
inexperienced; that is, for instance, if I want to buy some of this
land I have got to demonstrate before it will be sold to me that I
have had a certain amount of experience; in other words, that I
just didn't merely come out of an office somewhere where I have
been handling a typewriter or a pen all my life, courting absolute
failure from tne start-
Mr. AREXTZ. Those are the people that make the best farmers, Mr.
Herrick. Contrary to what you may think, the best farmers in the
West, the apple growers and fruit growers of ah 1 kinds, come right
out of the offices.
Mr. HERRICK. My experience has not been so. I took a man out
of the Wilson packing plant and financed him to the tune of S250
and lost every penny of it.
Mr. AREXTZ. Your man was an exception. Of course, it would be
absurd to make any such exception as that, because the city-bred
man makes a very good farmer.
The CHAIRMAN. We will dispose of those questions in executive
session. Proceed, Mr. Elaine.
Mr. BLAIXE. Now. section 12 refers to the Secretary receiving land
by gift, deed of trust, etc. There may be some well disposed people
that want to help the soldiers or others out and make a gift. There
may not be many cases of that kind, but a clause of this kind will
not be harmful, so that the Secretary will have- the power.
Mr. WILLIAM ->:,'. Mr. Blaine, I notice a provision in both section
11 and section 13 which seems to me to be a duplication. I was
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 45
wondering whether one can not be eliminated. You will observe
that in section 1 1 there is this provision :
Xo transfer, mortiao-e. or lease of any rijrht, title, or interest under a contract of sale
shall be valid v.ithout the approval of the Secretary.
I find the same provision over here in section 13 :
Xo contract affecting; the land made during a period of five years from the date of
sale shall be valid without the approval of the Secretary, unless full payment cf the
purchase price of such land shall have been made.
Mr. SIXXOTT. One refers to excess lands and the other refers to the
public lands.
Mr. ELAINE. One is Government lands and the other excess lands.
Under section 13 the Secretary may enter into a contract with a
district to construct a project, making the maximum area to receive
a water right to any one person not to exceed 160 acres, and the excess
acreage to be sold in farm units " of a size as will, in the opinion of the
Secretary, support a family, at prices and on terms and conditions as
contained in the contract with the district."
The farm unit will vary in different localities. In my State I am
satisfied the farm unit will be fixed at a very low maximum. Per-
sonally I would like to see it fixed below 40 acres. I realize that
more money has been made out of small holdings in the State of
Washington than has been made out of the large holdings. In the
fruit district in that State the holdings do not equal 10 acres, and the
fruit orchards in the Yakima Valley, where there are some fourteen
or fifteen thousand acres in fruit, I doubt whether fruit orchards
average 10 acres. Xo one man can take care of even a 10-acre fruit
orchard without help, and in that line of work the greatest profit
comes out of the farmer doing his own work. There we get the best
results; there we get the family unit at its best in those small tracts
and we get community life at its best. You can not conceive a
higher civilization than we have in the fruit districts of the Pacific
coast, and so I would be exceedingly pleased if the unit is held down.
I realize, however, in the mountain districts, the outlying districts,
where the land is to be given over to general farming purposes,
maybe wheat, oats, barley, corn, and alfalfa, that the acreage snould
be larger.
The CHAIRMAN. The fruit that is grown in your State is mostly
apples, is it not ?
Mr. ELAINE. Apples, pears, cherries mixed fruits. Apples pre-
dominate.
Mr. HAYDEN. In lines 15 and 16 you say, u No contract affecting
the land." '"Affecting" is a very broad term.
Mr. ELAINE. I believe that means directly affecting the land. It
would not necessarily be indirectly affecting the land.
Mr. HAYDEN. Eut suppose a landowner made a lease contract;
that would affect his land.
Mr. ELAINE. That would depend upon the period largely, would it
not ?
Mr. HAYDEN. It struck me as rather broad terms.
Mr. ELAINE. A temporary lease probably for a year would not
affect the title.
Mr. HAYDEN. Why do you limit this provision to a period of five
years ?
46 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. ELAINE. Well, I suppose that is a fair try out. A man should'
have some time to make a fair trial and that would eliminate specu-
lation. Pie ought to show good faith and not be allowed to come in
there purely to speculate.
Mr. WILLIAMSON. I don't believe that a lease contract can be
drawn under that provision, because that would be clearly a contract
affecting the land
Mr. HAYDEN. It seems to me the act should state the nature of the
contract that must have the secretary's approval.
Mr. SINNOTT. You would not want to prohibit the holder of the
excess acreage, who has sold it, from transferring his security.
Mr. ELAINE. No; that is true.
Mr. HAYDEN. We can look into this question a little further and
probably clarify it.
Mr. ELAINE. I think it is subject to investigation and probably
criticism.
Mr. SINNOTT. He could make no contract disposing of the lands.
The CHAIRMAN. He could make no contract affecting the title, I
should say.
Mr. ELAINE. Affecting the title, I should say; yes. Using the
words " affecting the title" probably would be the best.
Mr. SINNOTT. What kind of a contract do you contemplate be-
tween the holder of the excess acreage and his purchaser ? Have you
worked that out as to his retention of a lien for security of the land ?'
Mr. ELAINE. Well, yes.
Mr. SINNOTT. Do you know how they do that under the present
reclamation land law ?
Mr. ELAINE. So far as I know under the present reclamation law
each man sells his own land on such terms and conditions as he
sees fit.
Mr. HAYDEN. There was a provision in a contract for the sale of
certain lands under the Umatilla project, I believe, where the excess
areas were turned over to the Secretary of the Interior for disposal.
When the Secretary found a purchaser at the agreed price, the
owner of the land was obligated to issue a deed and take a mortgage
for the unpaid portion of the purchase price. That plan was worked
out in detail and seems to be feasible.
Mr. ELAINE. Yes; I sold a ditch one time to the Government and
retained the water rights to the unsold land. We sold our unsold
lands we disposed of them on such terms and conditions as we saw
fit, and we just followed out our old system of contract under a
five-year plan, or really a six-year plan, one-fifth down, one-fifth in
two years, and one-fifth each year thereafter. That was considered
proper under the present law.
Mr. SINNOTT. Was that under the present law ?
Mr. ELAINE. Under the present law; yes, sir.
Mr. SINNOTT. You took a mortgage, did you ?
Mr. ELAINE. No; we just had our contract, a six-year contract,
one-fifth down and one-fifth in two years, and one-fifth each year
thereafter with deferred payments at 6 per cent.
Mr. SINNOTT. You retained title until full payment was made ?
Mr. ELAINE. Yes; and in case of forfeiture.
Mr. SINNOTT. You see the present law is that the Secretary of the
Interior shall require the owners of private lands thereunder to agree
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 47
to dispose of all lands in excess of the area, and so on, upon such
terms and not to exceed such price as the Secretary of the Interior
may designate.
Mr. BLAIXE. I don't believe that I would make that too unyielding.
If you lay down a fixed rule it may not work in all cases.
Mr. HAYDEX. But it is absolutely essential that the price of the
excess areas be agreed upon before the project is undertaken, so that
the new settlers will obtain what is called the " unearned increment."
Mr. ELAINE. Yes; that is a thing that wants to be fixed.
Mr. SIXXOTT. That is fixed in the first part of the bill, page 3, as
a condition precedent to the Secretary entering into a contract that
the owners of excess lands shall have agreed with the Secretary upon
the price, terms, and conditions upon which they will sell their
excess holdings to settlers.
Mr. HAYDEN. That is a condition precedent to the authorization
of the project, but the Secretary should be authorized by law to
enter into such a contract.
Mr. SINXOTT. Authorized by law to make them sell?
Mr. HAYDEX. Authorized to enter into an agreement with the
owners of the land as to the price that he will receive for it when the
Secretary sells it to new settlers.
Mr. WILLIAMSOX. I think that covers it.
Mr. LEATHERWOOD. That will come a little later, Mr. Hayden.
Mr. HAYDEX. Congress should adopt about the same rule as was
laid down in the reclamation extension act, so there can not be any
question about the disposal of excess areas. If we do not do that, if
we leave any latitude, what is going to happen is that there will be
loose contracts drawn whereby the original owner of the land will be
in position to cancel the settler out of his equity and sell the land to
somebody else for a higher price.
Mr. SIXXOTT. You mean that the terms shall be fixed in the bill ?
Mr. HAYDEX. No; the authority to make such an agreement with
the owners of excess areas must be specifically granted to the Sec-
retary. The Secretary can only do such things as are authorized
by law.
Mr. BLAIXE. Well, it says under section 19:
That the Secretary of the Interior is hereby authorized to perform any and all acts
and to make such rules and regulations as "in his discretion may be necessary for
carrying the pro-visions of this act into full force and effect.
Mr. HAYDEX. That is the general covering-in clause, which we have
used a number of times, but it is better to say just what the Secretary
of the Interior can do and make it perfectly clear.
Mr. BLAIXE. You mean he shall be authorized to enter into all the
contracts contemplated by this act ?
Mr. WILLIAMSOX. I think it is better to leave it the way it is rather
than to make it too definite, because you tie him up then. I think
this provision is broad enough to enable him to enter into contracts
of the character made by him in the past.
Mr. HAYDEX. We want to be sure about that.
Mr. BLAIXE. Yes; we ought to be sure about it.
Mr. SIXXOTT. Of course, it is implied in here that the Secretary
may enter into a contract with the district when he shall be satisfied;
then it itemizes the things he must be satisfied of, among them that
the owners of excess lands shall have agreed with the Secretary upon
the price, terms, and conditions.
48 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. UAYDEX. But would it not be better to say that the Secretary
of the Interior is authorized to enter into contracts with the owners of
excess lands as to the price, terms, and conditions for the sale of such
lands than to handle it by implication ?
Mr. SINXOTT. Yes; it would be better legislation.
Mr. WILLIAMSOX. "Is authorized and required." You might put
it that way. Where would you put that in 2
Mr. HAYDEX. I think it should go right here in section 13. We
should compare that section with the reclamation law when we get
to it.
Mr. BLAIXE. Xow, the Secretary is not to enter into a contract with
the district unless 80 per cent of all holdings consent to the maximum
area established by the Secretary. Eighty per cent is certainly, in
my judgment, low' enough, but probably is~ about as good a figure as
it can be fixed at. The owner of these excess areas must grant a
power of attorney, irrevocable in nature, to the Secretary of the
Interior to sell their excess lands, and whenever he may doom it for
the best interests of the project and shall sell all remaining lands
unsold at the expiration of five years at public auction. It has been
suggested that all excess lands' shall be sold within one year after
water is available for such lands, instead of live years after the com-
pletion of the project, and I am inclined to think there is a good deal
x)f force in that suggestion.
The CHAIRMAN. Well, meanwhile, if that is not done, what would
the excess lands be devoted to, or who would be using them ? Would
the owner be enjoying the use of them and getting water ?
Mr. BLAIXE. According to the power of attorney. There is a
power of attorney to be irrevocable to the Secretary of the Interior to
sell these lands, but if he does not sell them
The CHAIRMAX (interposing). After five years.
Mr. BLAINE. He can sell them at any time within five years. He
can sell them within 30 days after the opening of the project, but
maybe five years is a long tune to wait before he can put the balance
of the lands up at public auction. It might be just as well to sell
them one year after the water is available for the land, not to leave
those outstanding lands too long.
Mr. LEATHERWOOD. Why is tiiis power irrevocable ?
Mr. BLAIXE. Because it ought not to be a power that can be
revoked at the will of the landowner.
The CHAIRMAX. I just suggest that allowing it to continue for
five years unsold, allowing the holder to continue for five years.
brings up a question of injustice perhaps in this on the matter of
unearned increment. You see during these five years the land is not
being sold and the value presumably rises somewhat and values
would be doubled say; now are you going to sell to a latter-day comer,
an eleventh-hour comer, at the same price that you sold to the man
who came at the beginning ? Say you sell to a man that comes at the
end of five years, or four years, you sell to him at the same price that
you sell to the man who comes the first year (
Mr. BLAIXE. I beg your pardon, Mr. Chairman; I did not get that.
The CHAIRMAX. lou sell to the purchaser that applies and makes
a purchase at the end of four years at the same price per acre that
you sold to some one who came at the end of one year, you see. Now,
.the man who came at the end of one year and bought and went on
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 49
and helped improve it, he has been helping to create this unearned
increment on the lands that remained unsold for four years, and he
takes his chances as to whether there will be any unearned increment,
whether there will be any rise in value of these lands; but here comes
this man who waits for four years and sees that the land has doubled
in value; he takes no chances; he comes along and buys it at the same
price that the man did who bought it at the end of the first year,
and he hasn't done anything in the way of public spirit or helped in
the improvement of the lands or helped the community to advance
it in any way, and you are fixed down to a certain price there; you
are going to have tne Secretary sell the lands at precisely the same
figure. He has a maximum now above which he can not sell these
lands, you see, and that maximum holds just the same during all
these four years, yet the land has become twice as valuable in four
years as it was in one year.
Mr. HAYDEX. Pardon me, Mr. Chairman, but let us consider the
other side of the case. Do you propose that the owner of this excess
land, who has done nothing himself but hold it and allow the Govern-
ment to spend money and create values are you going to let the
present owner get that unearned increment ?
The CHAIRMAN. No; I say it raises the question of injustice, both
as to the owner of the land and as to the first purchasers, those who
purchased in one year, for instance; they pay the maximum, say, and
here come these others at the end of three years or at the end of four
years, on most of these projects in three or four years it will be ap-
parent whether they are going to be a big success; they know whether
the values are going to rise, they know other people are going to come
in, and that the values will come up, and here is a man that waits for
four years until times are better, say, and capital is more plentiful;
he knows what is going to take place and he can \)uy at the same
price at the end of four or five years that he could have bought at the
end of one year, and it doesn't cost him a cent; he hasn't put up an
earnest option or anything else.
Mr. HAYDEN. He has taken a chance that somebody else will buy
it in the meantime.
The CHAIRMAN. There I think is a little problem, something that
deserves consideration.
Mr. SUMMERS. In other words, in justice to all, all ought to purchase
at about the same time.
The CHAIRMAN. Yes; they ought to take equal chances, equal risks
and equal burdens and equal responsibilities in making this project
a success.
Mr. HAYDEN. But there is no known way, Mr. Chairman, of com-
pelling anybody to buy anything unless he wants to.
Mr. SUMMERS. No; but you have a sale at public auction. If it
has not been sold at private sale you finish up by public auction.
Mr. HAYDEN. That is the chief virtue of the amendment which
Mr. Elaine has suggested, that instead of making it five years, let the
bill provide that the land may be sold within one year after water is
.available, at public auction.
The CHAIRMAN. That is what I am addressing myself to, that very
point, the wisdom of that. I know a case just Tike this. I have had
one big object lesson presented to me, and the owners feel that they
5666421 4
50 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
ought to have the benefit of the rise due to causes other than re-
clamation. I mentioned it here the other day. at the last sitting,
perhaps. They feel that they ought to have a'share in the rise, you
see, and it seems to me very clear that the man who stands back,
say for four years, whether it is not unfair to let him have all that
four years to observe conditions while the others take hold right at
the start in the first year and develop the project, add to the value,
improve it so that the values of all the lands are enhanced, and then
he comes along and buys, buys maybe when he has doubled his
money before ne invests anything, doubles his money before he
invests a dollar. That is what it means. I think that ought to be
taken care of, and I think the suggestion there of Mr. Elaine's and
this bears on that very question should be considered.
Mr. WILLIAMSON*. That is, you would shorten the time '.
The CHAIRMAN. I would shorten the time, because it is going to
work a great injustice and the water users are going to complain of it.
Mr. LYON. But on the other hand, Judge, wouldn't prospective
purchasers hold off, waiting for the sale at public auction, expecting
to get the land cheaper than at a private sale I
The CHAIRMAN. They would hold back as long as somebody else
was taking all the risk, going on with development, and they would
get the unearned increment. It tends to encourage them 'to hold
off.
Mr. LYON. But if they knew there was going to be a sale at public
auction within 12 months they wouldn't buy at a private sale, it
strikes me. They would try to buy it as cheap as possible.
Mr. SUMMERS. The}' would wait for this auction, if it was coming
within 12 months.
Mr. WILLIAMSON. You could safeguard that by saying it could
not be sold for less than a certain price in the beginning.
Mr. SINXOTT. It will be the Secretary's purpose to sell that land as
cheaply as possible, because the main burden is not going to be the
purchase price, but the water rights that will be put on top of the
purchase price.
Mr. SUMMERS. What is the provision in case these lands sell at
public auction for more than the price agreed upon with the original
holder ?
Mr. BLAIXE. I doubt if it will sell for more. Why wouldn't they
buy it beforehand, then?
Mr. I).v\ KiiEAi). Mr. Blaine. let me ask you one question. Un-
fortunately I did not know about the hearing on Monday.
Does your bill propose for the evential repayment to the Govern-
ment of' the amount of these appropriations?
Mr. BLAIXE. Yes, sir.
Mr. SINXOTT. How is that, Mr. Bankhead ?
Mr. BAXKHEAD. Does this bill provide for the eventual repayment
to the Government of the amount of these appropriations that are
made in this bill ?
Mr. BLAIXE. Yes, that comes later on in the bill.
Mr. BAXKHEAD. Wouldn't it be a good idea in determining this
question whether or not these lands might bring a bigger price than
the amount agreed upon by the owners, to look to the protection of
the fund, the repayment to the fund out of that excess purchase
price? Because the owners of the land have bonded their property
under this bill.
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 51
Mr. WILLIAMSON. It would go into the reclamation fund anyway,
if there is any excess.
Mr. SINNOTT. That comes under section 16, Mr. Bankhead.
Mr. BAXKIIEAD. Very well, I thought it might be pertinent in
connection with, this discussion of the chairman.
Mr. HERRICK. Isn't it a fact that the Government is acting in the
capacity of promoter, broker, and receiver in these projects to a
certain 'extent?
Mr. BLAIXE. Xo, not quite as broad as that.
Mr. HERRICK. Doesn't it amount to the fact that the Govern-
ment itself is undertaking to do the work under Government super-
vision ? Isn't that the fact ?
Mr. ELAINE. The Government does the work.
Mr. HERRICK. Under Government supervision ?
Mr. ELAINE. Yes, sir.
Mr. HERRICK. And at the same time the Government is under-
taking to arrange the disposal of it. Is not that a fact ?
Mr. ELAINE. Yes.
Mr. HERRICK. Well, now, that being a fact, why wouldn't it be
possible, just as soon as one of these projects is officially determined
upon, that it will be built and earned out. just like if you were going
to decide to erect a building on a lot here in Washington, why wouldn't
it be proper to ascertain the price at which the surplus land could
be sold, make it a fixed price and then sell it at an opening on a cer-
tain day and get it disposed of at once ?
Mr. BLAIXE. That is what this bill does. The project is thrown
open for settlement; the preference right to settle on these excess
areas is given to soldiers, and they have six months in which to make
their investigation.
Mr. HERRICK. In that event, I anticipate that there should be no
difficulty in having more applicants than there is really land for.
Mr. BLAIXE. I "think you are right. The lands tliat will not be
sold within a short time will be the poorer lands, and ultimately you
will have them put up at public auction. They may bring less man
what they have been put in the district at. I am not looking for
the good land to go begging.
Mr. LYON. Then who pays the landowner the difference between
the contract price and the sale price 2
Mr. BLAIXE. He only gets what is realized at the public auction.
Mr. LYON. In his original contract then he just agrees to sell at a
certain price, provided the land brings that price?
Mr. BLAIXE. Yes. sir.
Mr. SINNOTT. It is not contemplated that he gets what is realized
at public auction, necessarily; he enters into a contract with the
Secretary that the land shall be sold at a certain price. That is
before the Secretary approves of the district. The object is not to
let the landowner get a big price but to have this land disposed of
at some reasonable price in its natural state.
Mr. BLAIXE. The object is to pay the landowner what his land is
reasonably worth at the time of the formation of the district. He
gets nothing beyond that. But I don't think the bill contemplates
that the Government shall get any profit out of the land; the idea is
to get the land into the hands of the settler at as low a price as pos-
sible.
52 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. SINXOTT. Because he is going to have the burden of paying for
the water right.
Mr. BLAINE. Yes, sir.
Mr. SUMMERS. But if you put them up at public auction, then you
have to get the most you can get out of them, and if that exceeds
the price fixed which it probably will not do but if it should bring
a higher price, then it seems to me it ought to be specified that this
shall go into the reclamation fund.
Mr. SINNOTT. It is so provided.
Mr. SUMMERS. I don't see it. It would add strength to the bill; it
would show that there was no land speculation under any circum-
stances.
Mr. HUDSPETH. Pardon me, Mr. Blaine, I would like to ask the
judge I don't know whether I followed you very closely a while ago
if there is no fixed price upon this land and the Secretary can charge
whatever he thinks proper, and it is put up at auction, what incentive
would there be for a purchaser to hold off ? For instance, if the im-
provements that you make upon land enhance the value, and I have
to pay that additional, what incentive would there be to me to hold
off on a purchase '.
Mr. HAYDEX. I believe that you misunderstood the chairman.
Mr. HUDSPETH. Probably I did. That is what I was trying to
clear up.
Mr. HAYDEX. As I understand it, there is to be a fixed price. The
Secretary of the Interior is to agree with the owners of excess areas of
land that he will sell the excess at a fair price, agreed upon in advance.
When the Secretary declares the project open, all such lands will be
subject to sale and settlement, first by ex-soldiers.
Mr. HUDSPETH. He doesn't fix a price, though?
Mr. HAYDEX. The Secretary fixes a price as agreed upon with the
landowner. After the project is completed and the water is available,
if there are certain tracts, as there are under every project, where the
land is rough and will require leveling, that the returned soldiers have
not taken, the Secretary will offer such tracts for sale at auction, and
whatever the land brings at that sale the original owner must accept,
even though it be less than the price agreed upon. If the land should
sell for more than the agreed price, as Dr. hummers has suggested,
through competition at the auction although I do not see how that
could happen, because everyone would have the option of buying from
time to time -but if there was any excess realized, Congress might
provide, as we did in the case of the auxiliary projects on the Yuma
Mesa, that where tracts are offered for sale ana bring more than the
appraised price, that the excess shall go to the credit of the project
and help reduce the construction charge.
Mr. SUMMERS. Mr. Sinnott has now called my attention to section
8, which says that all moneys received under the provisions of this
act, not otherwise disposed of, shall be covered into the reclamation
fund.
Mr. HAYDEX. My idea is that rather than go to the credit of the fund
as a whole it ought to go to the credit of the project.
Mr. HUDSPETH. I agree with you.
The CHAIRMAX. What I have in mind was that there would be cases
where the same quality of land, land of the same productive capacity
and desirability, would remain unsold at the end of four years, as
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 53
was purchased at the start, and that the purchaser at the end of
four years would be deriving the benefit of the unearned increment.
Mr. HUDSPETH, I see your point, and it is well taken.
The CHAIRMAN. Without having invested a dollar.
Mr. HUDSPETH. I see your point.
The CHAIRMAN. And that the option comes at the end of five years,
and it ought to come earlier.
Mr. HUDSPETH. I agree with you.
Mr. HERRICK. I would like to ask a question or two of you, judge.
Was it the intention of the committee to try to complete the con-
sideration of this bill to-day?
The CHAIRMAN. Oh, no.
Mr. HERRICK. The reason I asked that question, judge, is this,
that before the completion of this hearing I am contemplating an
amendment, and I would not undertake to take up the time of the
committee if it was not intended to complete to-day, because there
are some matters that I would rather look up first, and it is just
possible that I might like to see whether I could get the committee
to agree to an additional section.
The CHAIRMAN. We will wait for that for executive session, after
we get through with the witnesses.
Mr. BLAINE. The latter part of this section, section 13, at the top
of page 9, provides in regard to State owned lands or minor sub-
divisions of the State owning lands, that those shall be disposed of,
excess areas disposed of as excess areas, etc. That will depend, of
course, upon the laws of the different States, and probably the
States will, in order to take full advantage of this law, authorize the
proper officers to agree to the disposition of excess areas. I am
quite sure that all the States will have to show a willingness to
cooperate under this act in order to get the full benefit of it.
Mr. HAYDEN. Your idea is that school sections and tracts of
State land are sure to be found in all of the projects?
Mr. BLAINE. Yes; college lands, and all that sorts of land.
Section 14 grants a preference right of entry for the period of six
months to soldiers of different wars, and that gives them a period of
six months after the opening of a project within which they have
this preference right of entry for the purchase of public lands within
the project, and also the excess lands. It is thought that under the
provisions of this act, taking one project with another, that the
ex-service men and women would receive practically 50 per cent of
all lands reclaimed. Personally I think that is true.
Mr. SINNOTT. Now, this would cover the veterans of the Civil W T ar,
too?
Mr. BLAINE. Yes.
Mr. SINNOTT. Do you think that is wise ? Are many of these men
physically able to do much work upon a project?
Mr. LYON. Some of the widows may be.
Mr. WILLIAMSON. I don't believe there would be enough of them
to make any difference.
Mr. SINNOTT. It might lead to speculation.
Mr. BLAINE. Well, will you limit it to those who have not hereto-
fore exercised the rights of homesteading ?
Mr. SINNOTT. The present law limits it to soldiers of the last war.
54 DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES.
Mr. ELAINE. Well, it is those who served on the American border
and the Spanish War veterans. It seems to me you might limit it to
those wars.
Mr. SMITH. I do not think it would be wise to discriminate against
the Union soldiers in any legislation. That is what we would be
doing.
Mr. SINXOTT. You are not discriminating. You are merely recog-
nizing the fact that many of these men are old and decrepit, and
could not perform the necessary physical labor to cultivate their
farms.
Mr. SMITH. But they probably would not want to go onto a
homestead.
Mr. SIXXOTT. Very few of them could do the actual physical
labor necessary. We are not discriminating against them at all,
but simply recognizing that fact.
Mr. SMITH. It will be three or four years before any of these projects
are opened, and by that time there will be very few of the veterans
who will be inclined toward going on them.
Mr. AREXTZ. And during these three or four years, Mr. Smith,
it will be necessary for them to make their payments of two or three
hundred dollars a year in order to carry them by, improve their
lands, and they will be up against it to make these payments.
Mr. BAXKHEAD. They don't have to make any payments until
the project is completed, do they I
Mr. AREXTZ. Yes: they make yearly payments.
Mr. HUDSPETH. I understand our chairman would be eligible. He
is hale and hearty, and I wouldn't want to exclude him.
The CHAIRMAX. I haven't had military service, however.
Mr. HAYDEX. The present law provides for a preference right of
60 days.
Mr. HERRICK. Gentlemen, I think we can dispose of this point of
controversy very easily by ignoring it. It is a fact that most of these
old veterans are so old and out of the running, as you might say, to
use a slang term that is used in horse races, that there won't be any
danger of any of them butting in, unless they are financially able to
hire or they have some funds or other relatives to do the work. I
think that^ disposes of the question automatically, and I don't
believe it would be wise to slap them in the face by putting a dis-
crimination in there.
Mr. HAYDEX. Now, as to the period of six months, the present
law provides a preference right of 60 days, which the Public Lands
Committee recommended be extended to 90 days. Why should
there be any difference between this bill and the existing law on that
subject ?
Mr. BLAIXE. The only object of that is to give them a little longer
time for investigation, and I don't know that it is necessary; they
may investigate prior to the opening of the project.
the CHAIRMAN. That would hold back a good while six months.
Mr. SIXXOTT. The reclamation service aims to have its openings
sometime in the fall, and too long a period would extend the actual
entry of the lands over into the summer. They ought to be able
the time should be so arranged that they would start in in the spring.
Mr. BLAIXE. Of course there is a provision in here that projects
for the benefit of the soldiers can be thrown open prior to their com-
pletion, at the discretion of the Secretary of the Interior. That
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 55
would give the service men some extra opportunity to take advantage
of it.
The CHAIRMAN. It would help them out somewhat.
Mr. SIXXOTT. You say men, women, and widows of men who have
served in the Army. Isn't that broad enough to permit the widow
of a man who has taken up one of these units, in case of his death,
taking another one ?
Mr. BLAINE. I think there ought to be a clause put in here that
this should be limited to soldiers who have not availed themselves
of land under the present laws.
Mr. SIXXOTT. ^ ou mean widows of men who have not taken an
entry ? That could be fixed.
Mr. HERRICK. That would be a wise provision, I think.
Mr. HAYDEX. If you would say "who are otherwise qualified to
make entries under the homestead laws," that would cover the case.
Mr. BLAIXE. Yes; I think that would be a limitation that ought
to go in.
Mr. ARENTZ. What I meant by my statement, Mr. Bankhead, was
the fact that oftentimes these districts comprise four or five different
projects, units, and when one unit is completed, that land will be put
under cultivation, and it takes some time before the two or three or
four units will be completed.
Mr. WILLIAMSON. Mr. Sinnott, would you have it read something
like this: "In which men and women and the widows of men who
have served in the Army, Navy, Marine Corps of the United States,
and who are otherwise qualified under existing laws?"
Mr. SIXXOTT. No; I wouldn't have it that way, because that would
shut out men who served in the war, but have heretofore had a home-
stead 'entry and probably sold it. We don't want to shut them out
just because they may Have had a wild desert land homestead.
Mr. HAYDEX. We might follow what I understand to be the prac-
tice in Texas, where a man may acquire a homestead from the State
if he swears that he does not now own a home. Is that the present
Texas law ?
Mr. HUDSPETH. No.
Mr. SIXXOTT. We have a limitation here of 160 acres.
Mr. HUDSPETH. He can buy land up to eight sections in certain
districts in Texas, no matter if he owns the finest home in Fort Worth.
Mr. WILLIAMSON. Of course under the present homestead laws a
man can only own 160 acres, if he files on a homestead.
Mr. SIXXOTT. Well, you have a provision in here, haven't you, that
one can not take up any of these units if adding the unit to his present
holdings exceeds 160 acres?
Mr. BLAIXE. Yes; that is true as to his present holdings.
Now, section 15 is to enable the Secretary to carry on and complete
projects begun or approved, and for the investigation, commence-
ment, and completion of other projects as may be deemed feasible,
and the Secretary of the Treasury is authorized and directed, upon
request of the Secretary of the Interior, to transfer from time to time
to the credit of the reclamation fund such money as the Secretary
of the Interior may deem necessary. Then it provides that the
amount that may be transferred to the reclamation fund during the
fiscal year ending 1922 shall not exceed $20.000,000; for 1923, $35,000,
000; for 1924, $45,000,000, and for each year after that for four years
56 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
not to exceed 50. 000, 000. If all of these sums are appropriated
there will be a total of $250.000,000.
Now, this money, $250,000.000, if invested properly invested
and particularly if it is invested in small projects first, and these
small projects are completed within a short period of time, and if
the property within these smaller projects increases rapidly in value,
within tour or five years, or six years, probably, at the outside, there
ought to be a rapid turnover of the money that goes into these proj-
ects from the sale of the bonds of the district.
Now, I have made some calculations upon the theory that
20,000,000 will go in the first year, and $35,000,000 the second year,
and $45,000,000 the third year, and $50,000.000 each year thereafter,
and I have allowed 4 percent interest upon the moneys as they go
in. The district bonds call for 5 per cent, but I have calculated this
rate of interest at 4 per cent, because the money will not be in use
all the time. In other words, there will be a working capital on hand.
I don't think that ought to exceed 20 per cent, or, counting off 1 per
cent from 5, making it 4, gives a working capital of 20 per cent.
At the end of the sixth year our total sum of principal and inter-
est would be $282,556,000.
Mr. BAXKHEAD. Right there, Mr. Elaine, that is made up of your
original appropriation of $250,000,000 plus what ?
Mr. BLAIXE. Accumulative interest.
Mr. BANKHEAD. One per cent ?
Mr. BLAINE. Four per cent. The bonds draw 5 per cent, but all
the money will not be working all the time, so I allow 4 per cent
return average return although the bonds themselves draw 5 per
cent.
Mr. SINNOTT. That is accumulated interest on what ?
Mr. BLAIXE. Accumulated interest on the money advanced by
the Government, because it is being invested.
Mr. SIXXOTT. $20,000,000 for the year 1922.
Mr. BLAINE. That $20.000.000 would be drawing interest for six
years.
Mr. SMITH of Idaho. But that interest would not be available.
Mr. SINNOTT. At 4 per cent.
Mr. BLAIXE. At 4 per cent. I calculated an average of 4 per cent.
Mr. SIXXOTT. Drawing interest from whom ?
Mr. BLAIXE. From the districts.
Mr. SMITH of Idaho. But if you capitalize the interest, that money
would not be available.
Mr. BLAIXE. We are calculating it in the sale of bonds. It comes
back in time. We calculate the bonds in the smaller projects will
be available for sale, say, in six years. I am quite well satisfied that
a good many' small projects in the West can be completed and the
bonds sold within six years, or in time to have the funds available
for the seventh year.
Mr. SIXXOTT. ~Do you mean that $20,000,000 will be paid back to
the Government eventually with interest at the rate of 4 per cent >
Mr. BLAIXE. I believe all this fund will come back to the Govern-
ment with an average rate of interest of 4 per cent. The bonds will
draw 5 per cent, but there are rest periods. All the money is not all
the time working. In other words, we have a working capital. I am
allowing that 20 per cent to be on the safe side.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 57
The CHAIRMAN. When does the bill contemplate that the interest
will first commence to accrue ?
Mr. BLAINE. From the time the money is appropriated to the
projects.
Mr. SINNOTT. You do not mean that the Government will be neces-
sarily repaid this $20,000,000 with interest at the rate of 4 per cent
per annum during the time it is transferred from the Treasury ?
Mr. BLAINE. I mean this, that at the end of 20 years this fund will
have earned on an average 4 per cent per annum.
Mr. SIXXOTT. But you don't bind anyone to repay that $20,000,000
to the Government at the rate of 4 per cent per annum ?
Mr. BLAINE. No, sir; but all the interest that accumulates belongs
to the Government and ultimately will go to the Government; while
it is turned over in the meantime to the reclamation fund, it ulti-
mately, when all work is finished, goes back to the Government,
principal plus interest.
Mr. SINNOTT. The Government will only get what is earned.
Mr. BLAINE. What is actually earned; yes.
Mr. SINXOTT. They can not demand that $20,000,000 back with
interest at the rate of 4 per cent.
Mr. BLAINE. No, sir.
Mr. HERRICK. Now, suppose I buy one of these bonds ; these bonds
draw 5 per cent interest. I get that 5 per cent, don't I ?
Mr. BLAINE. Yes.
Mr. HERRICK. The Government hasn't anything to do with that?
Mr. BLAINE. The Government has nothing to do with it after you
have bought it.
Mr. SUMMERS. But in the meantime your 20 per cent is not active
and is not drawing interest in the Federal Treasury.
Mr. BLAINE. In the reclamation fund.
Mr. HAYDEX T . It would be in the general balances of the Treasury.
Mr. SUMMERS. In the general balances of the Treasury, so that they
are either drawing 5 per cent interest or else they hold the money.
So your deduction of 20 per cent, it seems to me, is rather strict in
the application of the bill.
Mr. BLAIXE. I am making this calculation here just to show what,
in my opinion, will be the maximum fund.
Mr. SUMMERS. That will actually occur?
Mr. BLATNE. Yes; the maximum fund in the reclamation fund.
Mr. SUMMERS. But I am endeavoring to point out the fact that
you are not quite playing fair with the bill when you deduct 20 per
cent, because if the money is not expended, then it is in the unex-
pended balances in the Federal Treasury, and they are either drawing
interest on this money that is advanced, or else they are holding
20 per cent of the money, we will say, that is not advanced.
Mr. BLAINE. Yes; that is true.
Mr. SUMMERS. So the Federal Treasury suffers no loss, practically.
Mr. BLAINE. You are right.
The CHAIRMAN*. The bonds are not to be sold they do not sell the
bonds until certain conditions exist, namely, that the land within the
project is more than double the value of the bonds, the bonded
indebtedness. Meanwhile the bonds are drawing interest; the bonds
are deposited with the Government and interest accrues after the
bonds are deposited with the Government, and that interest then
is paid in to the Government.
58 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
Mr. BLATXE. Into the reclamation fund.
The CHAIRMAN. For the reclamation fund right along.
Mr. ELAINE. Yes.
The CHAIRMAN. Pending the arrival of the time when the bonds
can be sold and put on the market ?
Mr. ELAINE. Yes, sir.
Mr. SINNOTT. Then it will be a matter of bookkeeping to ascertain
how much interest has accumulated.
Mr. HAYDEN. What Mr. Elaine is trying to do is just to give us his
anticipation.
Mr. ELAINE. Of how this bill is going to work out.
Mr. HAYDEN. I would like to hear the rest of his statement.
Mr. ELAINE. Now, at the end of the sixth year, if this money that
goes in, or that is appropriated according to the provisions of this
bill, is kept reasonably well invested, in my judgment the principal
and interest at the end of the first 6-year period would be
$286,856,000, and at the end of the second 6-year period it would be
$357,813,000, and at the end of the third 6-year period it would be
$452^633,000, or a grand total at the end of 18 years of $1,092,320,000.
Now, we have in the reclamation fund invested at the present time
a net amount of $122,000,000, and we have an income from the sale
of public lands, and from the leases on coal and oil lands, and coming
from the water power bill, which in all added together will give us
probably around a billion and a half dollars. That would be your
condition in about 18 years from now.
Mr. HAYDEN. How do you arrive at that billion and a half ? That
is a lot of money.
Mr. ELAINE. "Well, we get a whole lot of it out of this $250,000,000
and a large sum from present sources.
The CHAIRMAN. Are you figuring, Mr. Elaine, that you will derive
from the leasing law the same rate as we are now getting from the
leasing law ?
Mr. SUMMERS. That we are now estimating and not getting, should
not you say ?
The CHAIRMAN. Well, yes.
Mr. ELAINE. I will be fair with myself and fair with you. When
these figures were made up it was estimated that from the sale of
public lands, the coal and oil leasing bill, we would get in the neigh-
borhood of $15,000,000 a year, but I don't believe we are going to
get that sum.
The CHAIRMAN. That may last a few years and then dwindle very
materially.
Mr. ELAINE. Senator Smoot gave us some information in regard
to this matter of income. In his opinion, the oil shale deposits in
the mountains and the phosphate rocks, etc., out of which we are
going to derive a large revenue, I understand, will increase rather
than decrease in years to come. He may be right or he may be wrong.
Mr. SINNOTT. If they discover a good process for extracting oil
from shale it will increase very rapidly, but that has not been per-
fected vet. Do you know what it costs them per barrel ?
Mr. ELAINE. Under this process they use the shale, or the heat
from the shale, to operate the plant, and it is almost a continuous
operation.
Mr. SINNOTT. They distill it I
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 59
Mr. BLAINE. They distill it, yes. It is a heat process and they
have got the heat there.
Mr. SINNOTT. The papers from time to time carry news of new
discoveries and inventions for distilling oil from shale.
Mr. ARENTZ. Of course, we have been distilling oil shales in Scot-
land for a long time, but those shales are a little different than ours;
the origin of them is different, and these shales in America have been
so cracked by that I mean the hydrocarbon is locked up in a dif-
ferent way than the Scotch shales, so that it has taken a great deal
of time to work out the problem.
Mr. BANKHEAD. Mr. Blaine, have you finished your explanation
there ?
Mr. BLAINE. No.
Mr. BANKHEAD. I wanted to ask you, with the permission of the
chairman, one or two questions in connection with your financial
scheme.
Mr. BLAINE. Yes; but before I finish this I wish to say that what is
now in sight from the lease of coal and oil lands is not large and we
can not possibly rely upon that uncertain source to carry on the
projects that we already have undertaken that the Government has
already undertaken. It would be a mistake to rely upon that source
of income.
Mr. SUMMERS. And unless the receipts from the leasing bill were
very large, then the grand total mentioned by you would not be
reached, do I understand ?
Mr. BLAINE. The grand total will drop below what I have said, but
this $250,000,000 I don't believe will fall below my estimate, and
there will be the return of the $22,000,000 already invested, and there
will be also a return from the sale of public lands. This is, of course, a
mere matter of judgment. But, anyway, what I was reaching to is
this, that we ought to be able under the provisions of this bill to re-
claim a good many million acres of land in the West, anld if the
soldiers get one-half of it, there is no reason why we should not
accommodate within the next 20 years at least 150,000 soldiers on this
land in the West, and we all have unlimited faith in that land. In
my State I know the results of reclamation; I don't know how the
soldier could be better benefited than to give him a chance to pur-
chase a small piece of reclaimed land out in my State. I know that
is true of California, Idaho, and Oregon, and I am sure it is true of such
districts as Greeley, Colo., Rocky Ford, and places like that. I think
it is generally true in the West.
So, under the provisions of this bill, if carried out, I think we have
a chance here to accommodate 150,000 soldiers' families at least and
a large number of other settlers on reclaimed lands in the West.
Mr. HAYDEN. I believe that your estimate of half of the benefits
going to returned soldiers is exceedingly low, in view of the fact that
under every reclamation project opening thus far of course, the
areas have been small there have been 10 soldiers seeking a farm
where one could be given.
Mr. BLAINE. Ten to 50 to every farm, that is right. On the other
hand, I think it would be in line of good public policy not to put
solid blocks of soldiers by themselves. There would probably be
too many unmarried men out there on the land, but we should mix
them with the people with families.
60 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
The CHAIRMAN. How are you going to regulate that? How will
you arrange that, not contemplating too many soldiers in one block ?
Mr. BLAINE. Well, I think that this bill will work out fairly well.
It contemplates taking up privately owned lands, and if the soldiers
get 50 per cent of the lands, and' it is up to the Secretary of the
Interior whether he will undertake the project unless conditions are
right.
Mr. HAYDEN. There can be no question of public policy involved
in concentrating ex-soldiers on a reclamation project. If the returned
soldiers have the preference right of entry for any period of time
they are sure to select the best land that there is on 'the project.
Congress wants to give the best that there is to them on account of
their military service. Now, naturally the best land will be in con-
tiguous bodies and will be selected in that way. Whether they are
single men or married men does not make any difference. The
population in my State has been about 60 per cent men and 40 per
cent women, merely because adventurous young men did the
pioneering, but that condition is gradually changing, as it is all over
the West. They send for their relatives and friends and get married,
and ultimately there is no doubt but what the proportion of men and
women in Arizona will be the same as it is all over the United States.
Mr. HERRICK. I don't wish to inject any hilarity into tiiis meeting
but I might make the suggestion that if my friend thinks there is any
great danger of that conmtion arising of too many men being out there
and too few women, it is a well-known fact that in some of these
manufacturing towns up in Massachusetts there is about 20 per cent
more women than men working at starvation wages, and in view of
the fact that the Government maintains an employment agency and
such things, I don't think it would be a great additional burden if,
coupled with some of these employment agencies, they would under-
take a bureau of marriage or something like that and let- some of these
unattached soldiers that get out there, or any other bachelor of good
standing, make application and have the application sent over "hero
to Massachusetts somewhere where the congested female population
exists, and send them down into these States.
Mr. SMITH. You do not pose as an authority on matrimony, do
you. Mr. Herrick? [Laughter.]
Mr. HERRICK. No; I am merely making that suggestion. We
have in my State what we call an order of brotherhood laws. Any
bachelor over 25 years of age that has had one or more misfortunes is
eligible to membership in good standing, and I am a member mysc-lf.
The CHAIRMAN. Now, Mr. Blaine, have you finished your presenta-
tion here of this bill ?
Mr. BLAINE. I am through the bill, unless there are some questions
to be asked.
Mr. BANKHEAD. Mr. Chairman, in connection with this financial
scheme, which of course is very important for us to consider, I would
like to ask Mr. Blaine just a few questions.
As I understood you, Mr. Blaine, you say that under the theory
that you propose in this bill, the Government will ultimately be repaid
the investment with interest ?
Mr. BLAINE. Yes; that is provided for in here.
Mr. BANKHEAD. How long do you estimate it will take, under the
operations of your bill for the Government to be finally reimbursed ?
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 61
Mr. BLAIXE. At the end of in 1942 the bill provides that the
Government is to be paid back at the rate of $50,000,000 a year.
Mr. BAXKHEAD. How are you going to derive the funds to pay
back this appropriation with interest '?
Mr. BLAIXE. At the end of that time we won't need all the funds
to be accumulated by the sale of district bonds, the paying up of the
obligations.
Mr. BAXKHEAD. Your bill, then, does not contemplate the con-
tinuous process of new projects from the funds to be derived ?
Mr. BLAIXE. Xo; if we reclaim as much land as we think we can
under the provisions of this bill, we will have it all cleaned up in
about 25 years from now in the West.
Mr. BAXKHEAD. Well, now, Mr. Blaine. what is the total amount
that the owner of the property what is the total amount of interest
under your scheme that the owner of the property in the bond
districts will have to pay annually 1
Mr. BLAIXE. Five per cent.
Mr. BAXKHEAD. And you think you can make a work sheet, a trial
balance whereby, with the payment only of 5 per cent, you can pay
back this appropriation with interest by 1942 ?
Mr. BLAIXE. Xo: not all of it. We commence paying back in 1942.
Mr. BAXKHEAD. What proportion of this ultimate repayment do
you figure from outside sources, other than the interest on tne bonds ?
Mr. BLAIXE. Well, the principal will come back. You see you
clean up a good many of your'projects within short term of years.
They will be cleaned up, the bonds of the projects will be sold.
Mr. BAXKHEAD. You do not contemplate the payment of any part
of this advancement by the Government out of the receipts from oil
leases and other sources of revenue ?
Mr. BLAIXE. Xo; that is a special fund that is coming into the
reclamation fund, and we are not disturbing that by this bill. This
is an enlargement of that fund. This law is an extension of the
present reclamation law largely.
Mr. .SMITH. I think I can answer Mr. Bankhead.
Mr. SIXXOTT. Just a moment, if you please, Mr. Smith; he spoke
of "with interest." It is only earned interest that the Government
is repaying.
Mr. BLAIXE. That is all, only what interest is earned. If it doesn't
earn interest, the Government doesn't get interest; but I feel quite
confident that the Government will get the principal back plus 4
per cent interest.
Mr. SIXXOTT. Now, commencing in 1942, according to section 16,
you must have at that date in this fund $50,000,000 from the proceeds
of bond sales.
Mr. BLAIXE. Yes, sir.
Mr. SIXXOTT. Xow, I wish you would explain just how we are
going to have that much bond sales at that particular time.
Mr. BLAIXE. At that tune I should think we should have more,
because there will be so many projects completed several years prior
to 1942.
Mr. SIXXOTT. But the projects are not paying anything into the
fund.
Mr. BLAIXE. But the fund will be accumulating; the reclamation
.fund will be receiving the money.
62 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. SIXXOTT. You are not paring anything from the reclamation
fund proper, the present reclamation fund. That is left intact.
Mr. BLAIXE. That is left intact: res, sir.
Mr. SIXXOTT. But what I was trying to get at is, where are 3-011
going to get the $50.000,000 in this fund in the rear 1942 >
Mr. BLAIXE. All right, we start at the end of six rears, or seren
years; we hare expended our capital sum of $250, 000,000 in projects.
Now, that money six years from that time ought to be coming back
in; or before that .time we ought to be able to sell bonds.
Mr. SIXNOTT. That doesn't come back in; you only get the fund
enhanced from bond sales.
Mr. ELAINE. Yes; that is true, but let me illustrate. I will illus-
trate by my own State. I am quite familiar with conditions there.
We hare in the Yakima Valley two projects that hare been thor-
oughly inrestigated, and I think all the plans and specifications for
construction are out. One will cost &5, 000, 000 and 1 think the other
will cost $8,000,000 or $9,000,000. If this bill should become a law
I know of no reason why those projects could not be completed
within two years time, and at the end of the third rear I am sure the
property within each of those districts would have twice the ralue of
the outstanding bonds, at which time those bonds will be sold and
the proceeds turned into the reclamation fund. I am quite sure that
such conditions exist in other States of the West. So if that is true,
that money comes into the reclamation fund and swells the reclama-
tion fund. I am satisfied as the years go by that conditions will
improre rather than otherwise, and if it does, there should be no
trouble disposing of the bonds soon after each project is finished.
If that is true, at the end of 20 years we are orer the peak of our
efforts, and we ought to be receiring in from the sale of bonds at
least $50,000,000 a year.
Mr. SMITH. I think I can make an illustration. We hare expended,
Mr. Bankhead, about $125,000,000 in the construction of irrigation
projects.
Mr. BANKHEAD. Orer a period since 1902 ?
Mr. SMITH. Since 1902, yes; 18 years. There hare been ralues
created on those projects of about $600,000,000. If we were able to
capitalize those projects as proposed under this bill we could get
back from the sale of bonds half that amount at least, $300,000,000.
Unfortunately this plan can not be applied to these Gorernment
projects, because those settlers are not paring interest, but if they
were paying interest they would be just as willing to owe prirate
indiriduals who would buy the bonds as they would to be owing the
Gorernment. So it would be simply a matter of transferring the
mortgage on these lands from the Gorernment to prirate capital.
The proceeds from the sale of those bonds would repay all that the
Gorernment had advanced twice orer. and that is the same process
that we expect to apply to projects taken up under this legislation.
So that we would get back, if we spent $250,000,000 or $300,000,000
and created ralues to the amount of $1,000,000,000, it would be very
easy to pay back the money to the Gorernment at the end of 20
years at the rate suggested, of $50,000,000 annually.
Mr. AREXTZ. The statement was also made here the other day,
Mr. Smith, that no project would take longer than approximately
five years to complete; that on the completion of any project the land
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 63
would be worth twice the bond issue, or twice the cost of the project.
In other words, the security would be twice over enough to pay off
the bonds, and then it would be sold; so after the six-year period the
bonds could be sold for any given project. So if we started in 1922,
in 1929, at the very outside, the first project bonds would be sold,
the money returned to the Treasurer of the United States or to the
reclamation fund. Now, then, take any 6 or 7 year period over the
20-year period from now till 1942; we would have more money than
$50,000,000 at the end of 1942 to pay back the first payment of
$50,000,000, and each 6-year period we would have that much more.
Mr. BANKHEAD. Have you ever tried to work that out on paper?
Mr. AREXTZ. I have studied that out on paper; yes, sir.
Mr. BAXKHEAD. To see if it will evolve that big sum of money
actually ?
Mr. AREXTZ. No; I haven't done that, because all I have figured
on instead of compounding, I have simply said 4 per cent in 20 years
would be $500,000,000 instead of $50,000,000.
Mr. SMITH. At the end of 20 years we would owe the Government
$500,000,000, including the interest. If we would pay it back at the
rate of $50,000,000 a year over a period of 10 years, the Government
would be entirely reimbursed.
Mr. BLAIXE. You take interest at 4 per cent and compute it
annually and add it or compound it, and it will double in 18 or 19
years.
I would like to call attention here to a letter received from Carlsbad,
N. Mex., which is in one sense away off by itself. The letter is from
the chamber of commerce. It gives the assessed valuation of the
farms, of the town, and the public utilities. The farms have an
assessed valuation of $1,423.960; the town has an assessed valuation
of $2,000,000; the public utilities, $300,000; total, $3,723,000. A
district will necessarily include the towns that will grow up in it.
You can see how fast the town property will add to the value of these
securities, because the power of general taxation must exist to pay
these bonds. Each one of these districts must have general power of
taxation.
Mr. SIXXOTT. Is the town property subject to taxation ?
Mr. BLAIXE. It would be if it falls within the district.
Mr. SIXXOTT. For the debts of the district ?
Mr. BLAIXE. Yes; all lands within the district, and if the town
falls within the district or a new town springs up within the district,
it doesn't make any difference which, the property is liable.
Mr. SIXXOTT. Theoretically, but in the practical operation of the
irrigation district laws are the lands in the towns subject to taxation
for the benefit of the district ?
Mr. BLAIXE. If it is within the district and is part of the property
to receive water.
Mr. SIXXOTT. We provide here that only lands benefited shall be
taxed.
Mr. BLAIXE. That is true; but, for instance, within the district a
town springs up and they are bound to spring up under all these
projects the land within the town is liable to the tax.
The CHAIRMAX. Take operation and maintenance; a town lot
gets no benefit from operation and maintenance. It might receive
some benefit possibly, indirectly, but I don't think it would receive
64 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
any direct benefit, like deriving water for irrigation. The town lot
in the district, the irrigation district, gets no water for irrigation
purposes, say, and for the operation and maintenance in the district
they have an annual charge.
Mr. ELAINE. But towns do get water for irrigation purposes.
The CHAIRMAN. They may get it for lawns, and so on.
Mr. ELAINE. Yes: but they get it just as much for the garden as
the farmer gets it for the farm.
Mr. HERRICK. I want to ask right here, too: Suppose a town
springs up in this district, where is it going to get its water for fire
protection if not from the project ?
Mr. ELAINE. It may get it from wells, if it is not too large a town;
but it would probably get a whole lot of it from the pumps connected
with the water supply. But the difficulty of that is that in winter
the supply is short, and generally they rely upon wells and springs.
The CHAIRMAN. The time has arrived for adjournment. Are you
through, Mr. Blaine ?
Mr. BLAINE. Yes; I am through.
Mr. SINNOTT. I wanted to ask some questions on section 18. I
wish you would explain section 18, Mr. Blaine.
Mr! ELAINE. I wish you would hear Judge King in regard to that
matter also.
Mr. SINNOTT. We would like to hear him, too. We would like to
hear you also on that, as to the meaning of section 18.
Mr. ELAINE. As far as the extension of those laws is concerned, I
will leave that to Judge King.
Mr. SINNOTT. I should like your explanation in regard to the pro-
viso, "that all projects or units thereof, upon which actual construc-
tion work shall be commenced after the passage of this act, shall be
organized in the manner provided herein, and all payments made
from the reclamation fund, and all such work shall be repaid to such
fund with interest in the manner herein provided," out in the West
in quite a good many places which I have personal knowledge of, a
general project has already been undertaken, but units within that
project have not been undertaken.
I mean under the present reclamation law.
Mr. ELAINE. Uncler the present reclamation law; yes. Now,
where a unit has not been undertaken as yet, I see no reaso'n why that
unit should not be constructed with the money that we are providing
here and made to pay the interest charge.
Mr. SINNOTT. Tnen, you mean that tney shall be organized in the
manner provided herein?
Mr. ELAINE. Yes.
Mr. SINNOTT. Well, that seems to me indefinite. There is nothing
here provided for the organization of anything, except to say before
they can secure any money they have to present a petition to the
Secretary, the petition of a* district.
Mr. ELAINE. Yes.
Mr. SINNOTT. You mean that they must organize an irrigation
district?
Mr. BI.ATXK. An irrigation district; yes.
Mr. SINNOTT. And tney can only get money from the reclamation
fund under the provisions of this ac
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 65
Mr. BLAIXE. I think where there is a unit where the work has
not been undertaken that they should not get money except that
they organize under the provisions of this act.
Mr. SIXXOTT. Then, you are modifying the old reclamation laws,
and I don't look very favorably, I will tell you frankly, upon the
provisions in this section, because we could not build another irriga-
tion project under the reclamation law unless somebody presented
this petition to the Secretary of the Interior. We would be practically
abolishing and repealing the reclamation law.
Mr. HAYDE*. I am sure that Mr Elaine had no intention of doing
thir (
Mr. BLAINE. Xo: we had no idea of doing that.
Mr. SIXXOTT. I think you are going a whole lot further here than
you ever intended to.
Mr. BLAIXE. Well, I think it will work out all right. There are
quite a good many units that have not been undertaken. Xmv. if
those units are undertaken under the provisions of this act, it will
leave a large sum of money coming in from the regular sources to
complete unfinished project-.
Mr. HAYDEX. There is one feature of the bill that I would like to
discuss with Mr. Blaine when we have time, and that is the necessity
for mingling the funds to be raised under the terms of this act with
the existing reclamation funds. I am not convinced that it is abso-
lutely necessary to do so in order to carry out the plan proposed in
this bill. When we meet again. I would like to take up that question
with you and Judge King and other friends of this bill to see whether
it is not advisable to create a separate- fund in the Treasury, to be
repaid by the sale of bonds, as provided in the act, apart from the
existing reclamation fund. It seems to me that if the two funds are
not kept separate we may be led into much difficulty. This is a
fundamental question which we will have to determine.
Mr. SIXXOTT. On this matter of future projects getting money from
the reclamation fund, and they paying interest, that would lead to
the grossest discrimination as between States. There already exists
a great disparity in the allotment of the reclamation funds among
the different States. Xow. I don't want to make any invidious
comparisons, but to get my ideas clear on the record, California has
been allotted about 82,000.000 from the reclamation fund, Nebraska
lias been allotted about $13,000,000, Nevada about 88,000,000, Ore-
gon about $8,000,000. Washington about 14,000,000, Utah a little
over 3.000,000, Oklahoma 883^000, South Dakota about 84.000,000,
Idaho about 824,000,000.
Xow. we will take just one comparison. Take California, which
has received 2.000,000. Idaho has received 824.000,000. Now, the
difference between the two and the twenty-four is 822,000,000.
Idaho gets its 22,000,000 without paying any interest, and we hope
some day that the matter will be evened up among the other States;
and California, when it catches up with Idaho and gets 22,000,000,
will have to pay interest on the 22,000.000. The same would apply
between Nevada and Idaho; Nevada will have to pav interest on
$16,000,000 that Idaho is not paying interest on now; Oregon would
have to pay interest on $16,000,000, which Idaho does not pay, and the
comparison will continue on down the line, and therefore I don't think
5GGG4 21 5
66 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
wo should mix the reclamation fund with this fund and make these
other States pay interest, when an adjoining State probably is not
paying interest on a large amount of money.
Mr. ELAINE. Let me ask you a question there, Mr. Sinnott. Do
you think the money will come in fast enough from the present
sources in order to equalize that ?
Mr. SINNOTT. What is that I
Mr. ELAINE. Do you think the money will come in fast enough
from the present sources to equalize that?
Mr. SINNOTT. Well, that would not change the argument any.
Mr. ELAINE. What is your idea, then ?
Mr. SINNOTT. My idea is to keep this fund that we are raising
under this bill wholly separate from the reclamation fund, as far as
the interest-bearing proposition is concerned.
Mr. ELAINE. I know. Then, if you used it -in your State and paid
the interest
Mr. SINNOTT (interposing). If we want to come in under if some
of our projects want to come in under this act and pay interest, that
is well and good; let them do it, but let that be optional with them,
and should they get money from the reclamation fund, don't make
them pay interest. That is the hardest fight that we have had since
I have been in Congress to prevent the charging of interest on the
allotments from the reclamation fund.
Mr. HERRICK. I beg pardon for interrupting you, but I think that
if we want to get anywhere with this matter when we get on the
floor of the House we are going to have to make each reclamation
project, to at least a certain extent, stand on its own feet, or we are
going to meet a lot of opposition. Am I right ?
Mr. SINNOTT. Certainly.
Mr. HAYDEN. Before we adjourn, I want to submit for the record
the following resolutions adopted by the Chamber of Commerce of the
United States at a recent meeting in Atlantic City.
(The resolution referred to above follows:)
Resolutions adopted by the Chamber of Commerce of the United States at its
ninth annual meeting, held in Atlantic City. X. J., April 27-29, 1921, on the subjects
of "Disabled veterans" and "Soldiers, sailors, and marines:"
DISABLED VETERANS.
The conditions surrounding the hospitalization, compensation, and rehabilitation
of the disabled veterans of the World War have not been adequately met. The
chief source of difficulty has been lack of governmental consolidation and centralized
authority. This defect should be remedied through consolidation in one depart-
ment of the Bureau of War Risk Insurance, the Rehabilitation Section of the Board
for Vocational Education, and the part of the Public Health Service which has to do
with the care and treatment of disabled veterans. Moreover, Congress should ap-
propriate the funds necessary for a continuing and adequate hospital-building pro-
gram.
SOLDIERS, SAILORS, AND MARINES.
The chamber deplores any tardiness in generous treatment for all who served in
the armed forces amd who became disabled or sick in consequence of their service,
and for the widows and orphans of those who lost their lives while serving in the
armed forces. The chamber approves such constructive measures as may be di-
rectly calculated to enable ex-service men to cultivate the soil, build homes, or
obtain vocational education.
For the purpose of affording ex-service men an opportunity to cultivate the soil,
we favor a national system for reclamation of waste areas. Such a system initiated
through adequate Federal appropriations can be made a means which, while pro-
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 67
viding opportunities directly for former members of the armed forces, will advance
the national interest.
The chamber, however, calls attention to the fact that a general cash bonus, or its
equivalent in certificates, would mean a very heavy increase in the burden upon the
entire community. For this reason the chamber favors forms of assistance other
than a cash bonus.
The CHAIRMAN. I will submit for the record at this point a letter
from the Western States Reclamation Association dated May 23,
1921, addressed to me as chairman of the committee:
WESTERN STATES RECLAMATION ASSOCIATION-.
Washington, D. C., May >.], 1921.
Hon. MOSES KINKAID,
Chairman Irrigation of Arid Lands Committee.
House Office Building, Washington. D. C.
MY DEAR JUDOE KINKAID: The following telegram has just been received by
Gov. D. W. Davis, of Idaho:
WALLA WALLA. WASH.
A resolution has just been adopted by the Interstate Realty Association, Pacific
Northwest.
Whereas irrigation of 17,000.000 acres of arid lands, for which water is available, is
contemplated: Beit
Resolved, That we indorse the object and efforts of the governors of the Western
States now in session and pledge them our loyalty and support in the important and
inspiring work of reclaiming the waste lands of Oregon, Idaho, Montana, and Wyoming,
the States represented by this association.
IRA E. HIGH,
President.
FRED O. BROCKMAX,
Secretary.
ARTHUR D. JONES,
FRANK McCuLLis,
JAMES WATKINS,
Committee.
Yours, very truly,
FRANK W. BROWN.
We will stand adjourned to meet on call of the chairman.
(Whereupon, at 12.10 o'clock p. m., the committee adjourned.)
COMMITTEE ON IRRIGATION OF ARID LANDS,
HOUSE OF REPRESENTATIVES,
Thursday, May 26, 1921.
The committee met at 10.30 o'clock a. m., Hon. M. P. Kinkaid
(chairman) presiding.
The CHAIRMAN. The committee will come to order.
Mr. BANKHEAD. Mr. Chairman, I want to make a little preliminary
statement, which I trust as a new member I can make with all due
modesty here. I requested the chairman of the committee to call
this special meeting in order that we might have the benefit of Mr.
Ross's testimony on this land settlement proposition. He is a
gentleman who has had wide experience and also a great deal of
personal observation and has made quite a profound study of this
whole problem, and I have pending before the committee a bill
(6048). I do not claim any pride of authorship in it at all. The
truth is that it was prepared very largely by Mr. Ross himself.
The new bill which I have introduced includes some features for
making short loans to soldiers that were not included in the original
68 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
bill that I introduced. This hill essentially is the same as the Mc-
Xarv-Smith bill in part of its machinery, but 6048, instead of provid-
ing that the appropriation shall be used exclusively for States in the
West, the arid lana States, provides a national policy, and I wanted
to have Mr. Ross to testify before the committee, explaining the
bill and especially differentiating the features of this bill from the
one that we have had under consideration and about which Mr.
Elaine has testified before the committee. I am sure that he will be
able to furnish a good deal of information that will be of value to the
committee on the whole general proposition.
The CHAIRMAN. I might add that Mr. Smith joined very heartily
in the request for the meeting for the express purpose of hearing Mr.
Ross. Do you wish to make any statement. Mr. Smith ?
Mr. SMITH. I wish to make a statement with reference to Mr.
Ross, especially for the information of the new members of the
committee. Mr. Ross formerly resided in Idaho and was the rep-
resentative of the Reclamation Service in undertaking the great
reclamation projects out in that country, and wa- witli the service
up until about 10 years ago. He is a professional engineer and since
his separation from the service has been practicing his profession
with headquarters at San Francisco, he also lias been making in-
vestigations with reference to available land in other sections of the
country that might be made available for settlement to a compara-
tively smaller extent. So I think we are forunate in having him be-
fore the committee, as he is well versed in this legislation and also
in land settlement problems.
The CHAIRMAN*. The committee will be glad to hear you. Mr. Ross.
Give your residence and occupation, please.
STATEMENT OF MR. D. W. ROSS, BERKELEY, CALIF., CON-
SULTING ENGINEER.
Mr. Ross. My residence is Berkeley, Calif. I am a consulting
engineer, with special relation to irrigation and drainage problems.
I might state for the benefit of the committee that my experience
covers a period of about thirty years, during which time I have been
quite activelv connected with the reclamation and settlement of lands,
chiefly in the West.
The CHAIRMAN. How much of that time were you in the employ
of the Government, in the Reclamation Servic4l
Mr. Ross. Six vears, from the initiation of the reclamation work
until 1908, and four years prior to my service with the Government
I was State engineer of Idaho, and in 1908 I resigned from the Rec-
lamation Service to become consulting engineer for a group of
eastern bankers that were very largely interested in reclamation
projects in the West. I was with them for several years, and from
1916 until 1920 I was a member of the State Irrigation Board of
California. So that much of my time during the past - _M years has
been occupied in public service where I have become particularly
interested in irrigation law and irrigation practice, the construction
of large works, and consideration of the human and financial pro-
blems in connection with land reclamation.
During the past three years I have been especially interested in
land reclamation in the South. In 1918, a short time before the
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 69
armistice, I had charge for the Reclamation Service of investigation of
cut-over and other reclaimable lands in a group of the southern States,
with headquarters at New Orleans.
The CHAIRMAN. Was that by direction of Secretary Lane ''.
Mr. Ross. Yes: it was in connection with Secretary Lane's plan
for providing homes for returned soldiers and sailors, and I had
occasion to investigate lands of various kinds that were susceptible
of reclamation in six or seven of the southern States, and I reported
on something over 10.000,000 acres of such lands.
The CHAIRMAN. Are you acquainted with the bill (H. R. 6048) ?
Mr. Ross. Yes: I am pretty well acquainted with it. In fact, I
have been very deeply interested in this and other proposed reclama-
tion legislation that has been before Congress for the past four or
five years. Having known Mr. Smith for many years in Idaho, I very
naturally followed with a good deal of interest the bills that he pro-
posed from time to time, and he was kind enough to refer those bills
to me, although I was not a citizen of his State at the time, and we
had a good many conferences in connection with them, and I became
very well acquainted with what is popularly known as the Smith-
Chamberlain bill, the Smith-Fletcher bill, and the Smith-McNary
bill, one of the measures now pending. Those bills are very closely
related that is, there is a common financial plan running through all
of them. This bill, 6048, introduced by Mr. Bankhead, is verv similar
to the McNary bill.
The CHAIRMAN. It is similar to the McXarv bill, which means it is
the same as H. R. 2913, the Smith bill here '(
Mr. Ross. I haven't a copy of the Smith bill. It is the same, how-
ever. I have Senator McXary's bill, 536, which I understand is
identical.
The CHAIRMAN. That is the same bill as H. R. 2913, the Smith bill.
Mr. Ross. There are two chief differences between Mr. Bankhead's
bill and Mr. Smith's bill. Mr. Smith's bill is limited in its operations
to the West, inasmuch as it provides only for the reclamation of lands
by irrigation. The Bankhead bill that is. bill 6048 provides for the
reclamation of land by all methods of reclamation. Hence it would
have general application throughout the United States.
The CHAIRMAN. While you are speaking of those bills, other than
6048, I deem it proper to call to your attention, or inquire of you,
whether you became acquainted with the Smoot bill which passed
the Senate in the last Congress and was favorably reported by this
committee and came to the House, and we had a brief hearing or two
in the House, but never were accorded time to secure a final vote on
the bill. That bill, anyhow, provides for reclamation in several re-
spects reclamation by surface irrigation, reclamation by drainage
of swamp lands, the clearing of cut-over lands, refertilization of worn-
out lands, and reclamation in general. Did you become acquainted
with that bill which was reintroduced in this Congress, the same
measure, now H. R. 3728? Did you ever become acquainted with
that bill known as the Smoot bill ?'
Mr. Ross. Yes, I followed that bill with a good deal of interest.
I made a pretty careful study of its provisions.
The CHAIRMAN. That provides for reclamation in general.
Mr. Ross. Well, as I understand the Smoot bill, the United States
will simply assume a supervisory relation to the work.
70 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
The CHAIRMAN. Yes.
Mr. Ross. The projects will have to be financed privately.
The CHAIRMAN. That is right. That is the distinguishing feature.
Mr. Ross. It has not very much connection with tliese two schemes
that are now under consideration, the Smith bill and the Bankhead
bill.
Mr. BANKHEAD. What is your opinion of the merits of the Smoot
bill ? I would like to get your expression on it, as far as reporting a
definite and substantial scheme of reclamation.
Mr. Ross. While I believe much will be accomplished under its
provisions, I do not think it will lay the foundation for what we
think of and speak of as a national reclamation policy. I don't
know that any other government in the world has adopted such
means for carrying on work of this kind. As I said before, the
United States is authorized under its provisions to supervise work
that will have to be financed through the ordinary agencies.
Mr. HUDSPETH. The Smoot bill, Mr. Ross, is chiefly in aid of
private corporations, is it ?
The CHAIRMAN. Private lands.
Mr. Ross. Yes, it would be private lands. The fact of the case is,
we have been engaged in the West, as in other parts ot the country,
chiefly in the reclamation of private lands, practically all private
lands. There are not so very many Government lands any more
that are reclaimabje: they are nearly all in private ownership.
The CHAIRMAN. Well, suppose. Mr. Ross, there should be a demand
by private landowners, a considerable demand, for the assistance
merely of the Federal Government, supervision by the Federal Gov-
ernment, on account of the Government having experienced reclama-
tion engineers, in the development of irrigation lands to which the
title has passed, land which belongs to individuals, and that the
National Government is not disposed to furnish money by which to
carrv on such development or such reclamation, what would you
think of the Smoot bill for that purpose ?
Mr. Ross. Well, in theory it is all right: in practice I have always
had serious doubts of many communities or corporations calling
upon the Government for supervision of the expenditure of their
funds.
Mr. HERRICK. I would like to ask a question right there.
Mr. Ross. And I am taking the practical view of it in the light of
my experience.
The CHAIRMAN. But here the Government has made a success
under the national irrigation law. and that success now is due the
success attained is due to the efficiency of the skill of the experienced
engineers, so that the national reclamation projects have a standing
with the public: whereas, you are aware of the fact, I feel confident
that the private projects which were developed years ago, developed
by private enterprise, the engineering was not, as a rule, so successful
as that under the Government reclamation law. and the bonds which
were issued and placed upon the market in some instances -a. good
many. 1 should say failed. So that those private projects, de-
veloped by private capital and having no assistance from the Govern-
ment whatever, were not, as a rule, successful.
Mr. Ross. I will agree with you. Mr. Chairman, that your observa-
tions would apply, say, to the conditions 20 years ago, and perhaps
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 71
within more recent times, but to-day practically all of the Western
States have amended their irrigation laws and have safeguarded the
standing of the bonds, so that in several States the bonds are selling
right now at a premium and have been for some time past irrigation
district bonds and in most of the Southern States, as far as I have
observed, those bonds have been selling at par.
The CHAIRMAN. You say irrigation bonds in some of the States ?
Mr. Ross. No; I mean drainage district bonds. Such districts
operate under laws very similar to the irrigation district laws, drainage
districts have practically the same powers. My observation is, too,
that there are fewer mistakes being made by engineers to-day than
there were a few years ago. I think it is largely due to the splendid
examples that have been set by the Reclamation Service. They
have adopted a much higher standard of engineering than was
practiced 20 or 25 years ago. Of course, as a consequence of this
works are to-day costing very much more; reclamation by every
means is costing more to-day 'than it did 20 years ago, because the
work is being done better, better plans are followed and more perma-
nent works are being constructed.
The CHAIRMAN. It is worth more because it is being done better?
Mr. Ross. Yes, sir.
Mr. SINNOTT. I desire to ask Mr. Ross one question in relation to
the sale of the bonds at par.
Is it your observation that the bonds are sold by the district at
par, or do you mean they are sold by the promoter or the first pur-
chaser of the bonds to the public at par?
Mr. Ross. You refer to district bonds ?
Mr. SINNOTT. Yes; irrigation district bonds. My observation is
that they are not sold by the district at par, but the bond house
generally buys them up at a discount and then the bond house some
times sells them at par, and in some cases at a premium. That has
been my observation.
Mr. Ross. In California during the last five years several districts
have sold their bonds at par and some at a premium.
Mr. SINNOTT. Irrigation districts (
Mr. Ross. Irrigation districts bonds; yes. Under the present
policy the State of Oregon, where the State has guaranteed the
interest on bonds, I think for the first five years, those bonds, I under-
stand, are to-day selling at a premium at'least they are selling at par.
The CHAIRMAN. Bearing what rate of interest ?
Mr. Ross. I think they are 6 per cent.
Mr. SINNOTT. Six per cent bonds ?
Mr. Ross.. The California bonds are all 6 per cent bonds.
Mr. SINNOTT. I know where they have been sold by the bond
houses at a premium, but not by the district. The district did not get
a premium or in a majoritv of cases did not even get par.
Mr. BANKHEAD. Now, if it is agreeable, I would like for Mr. Ross
to have the privilege for a while of explaining the differences between
these two measures.
Mr. CHAIRMAN. That is what I was going to ask Mr. Ross to go
right ahead m his own wav on Mr. Bankhead's bill and Mr. Smith's
bill.
Mr. Ross. In the Bankhead bill an effort has been made to take the
fullest advantage of existing land credit devices that have been pro-
72 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
vided by national and State legislation. The land credit device that
relates particularly to work contemplated under the provisions of this
bill that is. provided by State legislation is the irrigation or drain-
age district, with power to incur indebtedness, issue bonds, and levy
taxes for the repayment of its bonds. The land credit device that is
provided by Federal law is the Federal land bank. That is made use
of in the repayment of loans, the loans which are provided in connec-
tion with the settlement of veterans on the land.
In order to make the fullest use of the district, the Bankhead bill
provides for a bond that shall be paid under an amortization plan
over a period not exceeding 40 years. Now, by providing for that
kind of a bond the landowner is enabled to pay the cost of reclama-
tion through the payment of a minimum annual installment. A 5
per cent bond will be issued under the provisions of this bill, and by
the payment of 1 per cent for the amortization of the debt the bonds
can be repaid over a period of about 35 years: that is. by the pay-
ment of a total of 6 per cent each year.
Mr. SIXXOTT. Six per cent of the principal ?
Mr. Ross. Of the principal each year.
Mr. SIXXOTT. That includes the interest ?
Mr. Ross. Yes: that will include the interest.
Mr. SINXOTT. In how many years will that pay off ?
Mr. Ross. In about 35 years. Then, in order that the repay-
ment
Mr. HUDSPETH (interposing). Pardon me, right there. Mr. Ross.
That is the same plan as the joint-stock land banks loan their
money on.
Mr. Ross. It is practically the same basis for repayment of the
cost of reclamation as the farmer repays his loan from the Federal
land bank.
Mr. HUDSPETH. That is paid in 33 years.
Mr. Ross. Yes. Then in order that the scheme for the repayment
of the appropriation may dovetail with the repayment of the district
bonds, so there will be absolutely no question about the repayment
of whatever advances may he made for the construction of works in
any district that is organized, the payment of such advances shall
begin 10 years after the completion of the work.
Mr. SIN : XOTT. You mean the repayment to the Government '(
Mr. Ross. Yes: the repayment to the Government. And that also
is repaid under an amortization plan, and the Bankhead bill pro-
vides for the repayment of such debt over a period of about 40 years
with 4 per cent interest. And provision is also made for the pay-
ment of such interest as might accrue from the date of all advances
until the district begins the payment of these annual installments.
This is done by adding 1 per cent to the installment, which will begin
about the fifteenth year, or 10 years after construction is completed.
So, upon the payment annually by the district of 6 per cent, which
will be 4 per cent interest and 1 per cent for amortization, and 1 per
cent to include such accrued interest, the debt will be liquidated in
about 40 years.
Mr. SIXXOTT. What is that total now of the principal when you
get on to that period, 7 per cent each year (
Mr. Ross. Xo: the district will pay into the fund for the repay-
ment of its bonds, 6 per cent, 5 per cent interest and 1 per cent
DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES. 73
amortization. The fund will repay the appropriation upon the
payment of 1 per cent for amortization, 1 per cent to include the
accrued interest and 4 per cent interest. So, upon the payment of
6 per cent on whatever advances might have been made to a project,
beginning about the fifteenth year and continuing for about 40 years,
the appropriation will be repaid.
Mr. BAXKHEAD._ With interest (
Mr. Ross. With interest.
Mr. SIXXOTT. Will that also take care of the bonds ?
Mr. Ross. Xo: that is a matter separate from the bonds.
Xow if you will let me explain how this fund is to be turned over
and used for the reclamation of other lands. The bill provides that
the estimates of the cost of construction shall include the interest
which would accrue during the period of construction. If we assume
that the period of construction will average about four years, then
the interest that would accrue during that period would be about
10 per cent that is, it would be about 5 per cent interest on the
entire amount of the advance for two years; then bonds would be
issued by the district for an amount equal to 110 per cent of the
money actually advanced on construction. For each $100 of money
actually advanced the district would issue bonds amounting to SI 10.
The $100 would be available for sale
Mr. SIXXOTT (interposing). Is that what you call capitalizing the
interest (
Mr. Ross. Yes. The 8100 would be available for sale, the $10
being retained in the fund. The payments on the SI 00 would be
paid to the purchasers of such bonds: while the payments on the $10,
which the fund would retain, would be paid into the fund. Xow
then, a further fund is provided to insure the repayment of the appro-
priation by levying an annual assessment of 1 per cent upon the total
cost of the works of each district. This 1 per cent would be levied
on the 110 per cent of bonds. So that in the case of a million dollar
appropriation for a project, SI, 100, 000 worth of bonds would be
issued by such project. One million dollars of that would be avail-
able for sale to the investing public, the proceeds to be turned back
into the fund to be used for another project. One hundred thousand
dollars would be retained in the fund and there would be paid on that
S100.000 each year S6.000 to amortize it. This revenue will be paid
into the fund. There would be paid in addition to that by the
district 1 per cent, which would be SI 1,000. Xow. by providing
that the repayment of the appropriation shall not begin until 10
years after the completion of the work, which would be about the
fifteenth year, there will have accrued up to such time an amount
sufficient to insure the payment of all installments on the appro-
priation regularly from this time on. In fact, the revenue from the
two surces that I have mentioned would gradually gain upon the
amounts due for the repayment of the appropriation until at the end
of the period there would be a very substantial surplus.
Mr. LYOX. Does the bill provide, Mr. Ross, that that amount
paid in would be reinvested '(
Mr. Ross. Yes; it may be reinvested.
Mr. LYOX. In other words, you would have S16,000 the first year
to reinvest ?
74 DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES.
Mr. Ross. You could reinvest it : yes. My estimates are based
upon simple interest, so it is perfectly safe, and I find that there is
a very substantial margin.
The bill also provides that each project will be a separate unit;
that is, each project will repay its indebtedness into the fund, but the
fund which will be administered by the Federal Farm Loan Board,
will pay the indebtedness of all projects, you understand, so that
each project will stand upon its own bottom: that is, project Xo.
1 will repay into the fund whatever amount may have been appro-
priated by Congress for its construction, and the' repayment of such
amount will be shared by all other projects which might originate
from the sale of the bonds issued against project No. 1, and then the
next project, and so on.
Mr. HUDSPETH. Project Xo. 1 would be separate from any obliga-
tion to project Xo. 2 or Xo. 3 '(
Mr. Ross. Yes: they would stand absolutely in the clear, but such
surplus as would result from each project would find lodgment in
the fund and would be available to make up any deficiency or meet
the unexpected at any time. But each project will pay out separately,
just as a farmer will repay his loan separately, although his mort-
gage may be included with a block of mortgages which serve as a
basis for an issue of bonds by the Federal land bank. By such
means we have made, I think, the fullest use of the credit device that
we now have. By providing that district bonds shall be 5 per cent
bonds and shall be paid under an amortization plan, all district
bonds willbe exactly the same. The State law will of course have
to be amended to authorize the issuing of the kind of bond which
this bill provides for such projects as the Government might under-
take in any State, so that we will have uniform bonds. The market
will become acquainted with such bonds and the investing public
will not be puzzled to know whether a bond is a 15 or 30 year bond
or how its principal is repaid, for they will all be paid in about 35
years under an amortization plan.
Mr. SIXXOTT. Do you think the public will take to that bond, or is
that the same kind of a loan that the public takes now under the
Federal farm loan act (
Mr. Ross. It will be practically the same: yes. I think there will
be no question about that at all. I should think it would be a very
attractive form of investment for insurance and trust funds and other
funds of that character.
Another feature of the bill is the provision for settlement of lands
by veterans. If you will turn to section 15. you will see that the
Secretary is given authority to prepare the land for cultivation that
is. any land that i-^ available for entry or purchase by veterans. He
may prepare such land for cultivation and may place other improve-
ments upon it aside from the mere reclamation of the land. But in
the case of such improvements, other than cultivation, they shall be
paid for by the State or some other agency. This lays a foundation
for a policy of cooperation between States and the Government in
connection' with the settlement of veterans on the land.
Then in section 16 the Secretary is authorized to make short-term
loans. If you will observe, in that section he is allowed considerable
discretion." It says:
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 75
The Secretary shall by regulation prescribe the amount and kind of security (which
shall be adequate to secure the loan), the terms, interest, methods of payment and
enforcement, and other conditions of the loan.
He is given quite large discretion there, but this loan is designated
a short-term loan.
Mr. SIXXOTT. Is that out of the cooperative reclamation fund?
Mr. Ross. Yes; that would come out of the fund. Then it pro-
vides that whenever the land of any settler of a project shall have
attained a sufficient value for the purpose, the settler shall repay all
or any part of any loans made by him, all or any part of the purchase
price of his land, or the cost of improvements placed thereon by
authority of the Secretary, as he may be directed by the Secretary,
from the proceeds of a long-term loan which the Secretary may nego-
tiate through the Federal Land Bank, or when terms are as favorable,
through any other agency. Then the amount of loans when repaid,
together with interest thereon, shall be paid into the fund.
Xow. I think it is very fair to assume that such loans will not run
for more than two or three years, and that a value will be attained in
two or three years after settlement, so such a long-term loan can be
made from the Federal Land Bank which will liquidate this short-term
loan and repay any other loans that the veteran may have made, or
in many cases it would repay the purchase price of the land, espe-
cially where the land is cheap, as it will be in most cases.
Mr. SIXXOTT. What compulsion upon the settler do you provide in
the bill to do that, to compel him to take that >
Mr. Ross. He does it under the direction of the Secretary. The
Secretary would have the power. It says. " which the Secretary may
negotiate through the Federal land bank."
Mr. SIXXOTT. In case he refused to do that, what penalties have
you provided I
Mr. Ross. Well, I think. Mr. Sinnott, the language here gives the
authority I think we give sufficient authority to the Secretary for
the purpose, but in the settler's application for a loan the Secretary
would without doubt have such application contain a provision that
he would replace such loan by a long-term loan negotiated from the
Federal land bank. I think under the language of the section the.
Secretary himself could do this.
Mr. BAXKHEAD. Do you remember what provision was made in
that connection under the bonus bill that was recommended pro-
viding for the advance of short-term loans to soldiers >
Mr'. Ross. Which bonus bill ?
Mr. BAXKHEAU. The Moitdell bill.
Mr. SIXXOTT. The Fordney bill.
Mi\ BAXKHEAD. Wasn't that left to the Secretary the terms ?
Mr. Ross. Xo: the Mondell bill did not contain a provision for a
short -term loan.
Mr. BAXKHEAD. Which bill was that, Mr. McRae?
Mr. K. M. McRAE. There was a short-term loan provision in there.
It provided a loan of 2,000 for the soldier settler on the land for
the purchase of live stock and equipment.
Mr. Ross. There were two kinds of loans made; one was a long-
term loan that was repaid along with the land, and the other a
shovt-tevm loan for the purchase of livestock and equipment.
Mr. LITTLE. Is this like the Taylor bill that was introduced three
years ago in accordance with the suggestion of Mr. Lane ?
76 / DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. Ross. I did not catch your question.
Mr. LITTLE. Is this similar to the Taylor bill introduced some three
years ago in accordance with Mr. Lane's suggestion I Is this like
that >.
Mr. SMITH. What Taylor bill do you mean ?
The CHAIRMAN. Taylor, of Colorado. This committee reported
that bill out favorably.
Mr. SINNOTT. That was a very brief bill.
Mr. Ross. I am not acquainted with the Taylor bill.
Mr. LITTLE. In pursuance of Mr. Lane's suggestion, just at the
close of the Sixty-fifth Congress Mr. Taylor, chairman of this commit-
tee, introduced a bill to take the place of Mr. Sinnott's bill, at that
time before us, which was intended, it seems to me. to be like this.
Does this spring from Mr. Lane's suggestion ?
Mr. Ross. Yes; it is intended to embody those features.
Mr. LITTLE. It is the same bill '(
Mr. Ross. But it is stated more briefly than the same provision
contained in the Mondell bill.
Mr. LITTLE. It is the same thing as the Mondell bill (
Mr. Ross. Substantially the same, excepting that this specifically
provides that the advance made by the Secretary shall be a short-
term loan; then he is authorized to repay the same through the nego-
tiation of a long-term loan, just as soon as a sufficient value has been
established for the purpose.
Mr. SINNOTT. You keep your fund entirely separate from the recla-
mation fund, do you not ?
Mr. Ross. Yes: I think if you examine section 20 you will see that.
Section 20 is very similar to a provision contained in the Smith-
McNary bill.
Mr. SINNOTT. You say there "That moneys paid into the fund
under this act for completing the construction of projects begun under
the terms and provisions of the act of June 17, 1902, known as the
reclamation act." and so on. "may be expended under the provisions
of such reclamation act." Where do you provide in here for the pay-
ment of moneys into the fund (
t Mr. Ross. In section 17, the section providing for the appropria-
tion. The Secretary of the Treasury would transfer from the Treas-
ury these amounts directly to the fund created under this bill, and
then the Secretary would have authority in section 20 to transfer into
the reclamation fund such amounts as might be needed for the com-
pletion of projects already begun.
Mr. SINNOTT. Now you say down below. "Provided, however, that
all reclamation projects or units thereof upon which actual construc-
tion work shall be commenced after the passage of this act." That is
section 20. Do vou mean that all irrigation projects begun from the
reclamation fund proper hereafter shall come within the provisions of
section 20 *
Mr. Ross. Well, all reclamation projects or units thereof upon
which actual construction work shall have been commenced after the
passage of this act. That is, in case a unit of an existing project
should be begun after the passage of this act, it should be constructed
under the provisions of this act.
Mr. SINNOTT. Even though the funds come from the reclamation
fund proper ?
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 77
Mr. Ross. No; in that case they would not. They would come
from this fund direct.
Mr. SIXXOTT. And you don't mean that shall apply to the present
reclamation fund ?
Mr. Ross. No; under the provision it would automatically be kept
separate from the present reclamation fund.
Mr. BAXKHEAD. The reclamation fund, I understand, is safe-
guarded so as to guarantee the completion of all projects now under
construction or contract, or approved under the original reclamation
act ? In other words, the fund now in the reclamation act will be
separate and apart for the completion of all projects now in contem-
plation or agreed upon ?
Mr. Ross. Yes: by no possible means could any amount in the
reclamation fund be diverted into this fund.
Mr. SIXXOTT. That is a little broad, Mr. Bankhead, because new
projects, entirely new projects, may be taken up under the reclama-
tion fund.
Mr. ROSE. Yes: but by no possible means could any money in the
present reclamation fund be diverted into this fund, but the Secretary
has authority under this bill to divert money from this fund into the
present reclamation fund for the completion of work already begun,
and of course, as I understand this bill, once a diversion of that kind
is made, it would remain in the existing reclamation fund, and that
is why it is necessary to make provision so each project can pay out
separately; otherwise projects which are begun under the provisions
of this act will have assumed the repayment of the entire appropria-
tion, which of course would not be practicable.
Mr. SIXXOTT. Otherwise you would have some States paying
interest on the reclamation fund and other States not.
Mr. Ross. Only to the extent to which they would continue to
operate the existing reclamation law.
Mr. SIXXOTT. That, of course, is one thing that I object to.
Mr. LITTLE. Does the Government put up money under this bill
for schoolhouses in those districts, and the like '.
Mr. Ross. It does not so provide under this bill.
Mi 1 . SIXXOTT. There is a great disparity in the allotment of recla-
mation funds now in the various States.
Mr. Ross. Yes.
Mr. SIXXOTT. A disparity amounting in some cases to over
$20,QOP 7 090.
Mr. LITTLE. In what State ?
Mr. SIXXOTT. Well, there would be between California and Idaho,
for instance.
Mr. LITTLE. Which gets the more ?
Mr. SIXXOTT. I don't think the members from California and I
know as far as the disparity between my State and other States is
concerned, I would not want to see one State have $15,000,000 to
320,000.000 without the payment of interest, and then when it comes
time for my State to get my share and even up that disparity, then
my State must pay the interest. I want to keep the two funds,
the two projects, separate.
Mr. Ross. They would be kept separate.
Mr. SIXXOTT. Now, there is just one question I want to ask you
concerning section 6. The bonds are not to be sold until the board
finds that the project is twice the value of the outstanding bonds.
78 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. Ross. Yes.
Mr. SIXXOTT. What is your experience in the construction of
irrigation projects as to how long a time it would take before that
condition obtained, that the project is double the value of the
expenses ?
Mr. Ross. My observation is that that condition is established
almost by the time the works are completed, but in extreme c
within a period of two or three years after the construction of the
works.
Mr. SIXXOTT. What do you mean by the construction of the works ?
Mr. Ross. I mean completion of all the works, the reclamation
works.
The CHAIRMAX. Read}* for operation; when it is ready for opera-
tion.
Mr. Ross. Yes; when they are ready for operation. That is what
I mean by completion.
Mr. SIXXOTT. From the inauguration of the work, how long a time
would that be ?
Mr. Ross. I am assuming that the construction period would be
about four years, but there would be no payments due during that
period, neither of interest or principal: and then I assume that by
the end of the sixth year the bonds might be sold under the provisions
of this section; that the assessable property of the district will have
a value equal to twice the face value of the bonds. I think there will
be very few exceptions to that.
Mr. LITTLE. Well, there would be a great difference in districts,
wouldn't there ?
Mr. Ross. Yes; but the six^ear period that is assumed provides a
very safe margin. In most cases it would be upon the completion of
the~ works, that the property, the assessable property, would be worth
twice the cost of the works.
Mr. SUMMERS. That period would vary somewhat according to the
method of settling the lands and disposing of any lands that were not
taken up in the regular process.
Mr. Ross. Yes; that would be a factor, and quite an important
factor, too.
Mr. SUMMERS. For that reason it would seem that any of these bills
ought to carry with them a plan for the rather rapid settling up of the
lands, because it would bring this period for the sale of the bonds at
an earlier date.
Mr. Ross. Yes. Well, this bill places in the hands of the Secretary
the same powers that the McXary bill does. This bill differs from the
McXary bill only in the features that I have called attention to.
Mr. SUMMERS. My observation, I mean, should apply to this bill
and the Smith-McNary bill.
Mr. Ross. Yes; you are correct about that. There is no question
about it.
Mr. SIXXOTT. In your estimation of that period of six years, what
do you estimate the cost per acre of the irrigation to be ?
Mr. Ross. Well, of course, that will vary widely; there will be a
great variation in cost, but I think we will find that $60 per acre will
be a pretty fair average cost.
Mr. LITTLE. You don't count the land worth anything in that,
do you '(
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 79
Mr. Ross. Oh, indeed, yes, the land is worth a good deal.
Mr. LITTLE. How much of that $60 is the value of the land ?
Mr. Ross. The $60 is the cost of reclamation.
Mr. LITTLE. Then I will ask you another question. What does it
cost to get the land into shape so that it returns something worth
while, including the value of the land when you start?
Mr. Ross. Well, of course, there is no uniform cost: it will vary
all the way from $25 an acre to $200 an acre, hut I estimate that $60
an acre will be a pretty safe average cost of reclamation under the
provisions of this bill. That would include drainage and irrigation.
Mr. LITTLE. But the land is worth something when you start it.
What is that worth ? That has to be added to the $60.
Mr. Ross. No, that would not be added to the S60.
Mr. LITTLE. Well, I am going to add it to the $60. What will you
say it is worth when they start, the land ?
Mr. Ross. You might assume any value. Assume a fair value of
$10 an acre, that it is worth that before reclamation.
Mr. LITTLE. Do vou think that is an average ?
Mr. Ross. I would not attempt to fix any average, because we are
dealing with such a variety of conditions. But let us assume that
it has a value of $10. Xow, if you assume this as a fair value before
reclamation, there will have been expended then, say, 70 an acre.
Mr. LITTLE. It is worth $70 when they get it reclaimed, then?
Mr. Ross. Yes, it is worth more. Say, at two years after it is
reclaimed it is worth at least twice the cost of reclamation, because a
large percentage of it will be under cultivation at that time.
Mr. LITTLE. There are some districts, I presume, where that is not
correct, aren't there?
Mr. Ross. Very few.
Mr. LITTLE. Which are they?
Mr. Ross. Taking into account the need of reclamation, because
in such cases the lands would have a value, a real value, before the
owners would attempt to reclaim them
Mr. LITTLE (interposing). Which are the districts where the land
has not reached such a value ?
Mr. Ross. Has not ?
Mr. LITTLE. Yes.
Mr. Ross. Well, I don't know of any districts. I don't know of
any body of land suitable for reclamation where the lands are not
worth twice the cost of reclamation.
Mr. LITTLE. Of all the lands that we have been working on for
years, which district has the highest value ?
Mr. Ross. Are vou speaking now of the West or South ?
Mr. LITTLE. Take them both.
Mr. Ross. Well, I know lands in California that sell at $200 an
acre before irrigation facilities are provided.
Mr. LITTLE. That is in the valley, you mean ?
Mr. Ross. In the valley, lands that have been used for 40 years.
Mr. LITTLE. That would not be the Imperial Valley ?
Mr. Ross. No, I did not say the Imperial Valley in the San
Joaquin or the Sacramento Valley.
The CHAIRMAN. You are irrigating, reclaiming by irrigation,
lands in California that have been cultivated for 40 vears, for the
purpose of increasing the yield, increasing the production ?
80 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. Ross. Yes, Mr. Chairman, with the exception of the Im-
perial Valley practically every acre of land that has been put under
irrigation in California was used prior to irrigation for dry farming.
The CHAIRMAN. But you can in some cases double the yield or
something like that '.
Mr. Ross. Yes, or establish an entirely new system of agriculture.
The CHAIRMAN. Much more profitable I
Mr. Ross. Much more profitable; yes, sir.
Mr. LITTLE. In what districts have Government reclamation funds
been used to increase the value of the farming lands that have been
used for 40 years ?
Mr. Ross. There is one project in the Scacramento Valley in
California, the Orland project. All of that land had been used for
40 or 50 years before the Government irrigation was provided.
Mr. LITTLE. You spoke of the difference between the West and
the South. What irrigation do you have in mind in the South *
Mr. Ross. I don't have any irrigation in mind. I have drainage
in mind in the South.
Mr. LYOX. In speaking of the $60 cost per acre, Mr. Ross, do you
think that it would cost that much to reclaim the land in the South
by drainage ?
"Mr. Ross. It will cost more than that to reclaim some of it.
Mr. LYOX. Were you with Secretary Lane in his visit to Bolton.
\. (D.I
Mr. Ross. No.
Mr. LYON. You don't know anything about the cut over lands
around there '.
Mr. Ross. Xo. I do not. I had to do with the lands in Louisiana
and Texas and Arkansas in that section.
Mr. LYOX. The* reason I asked you what it would cost is, I think.
there are probably 150.000 acres there that an engineer a few years
ago figured could be drained for So an acre.
Mr. Ross. Yes. I will agree with you that such statements have
been made. Statements have been made to the effect that the Ever-
glades could be drained at a cost of 85 per acre, but it is costing in
many cases $25 to S40 per acre.
Mr. SIXXOTT. You spoke a while ago of the cost of ?00 an acre, and
in that connection you gave as an illustration land worth S10 an acre.
Mr. Ross. Yes.
Mr. SIXXOTT. Of course, the SI;D j< ;; 11 that represents the bond
issue, theoretically.
Mr. Ross. That would be the bond is-ue- yes.
MY. STXXOTT. That would be the bond issue?
Mr. Ross. Yes. Now the point I wanted to make was that, say,
within two \ ears from the time such land as that has been reclaimed,
it would undoubtedly be worth twice the cost of its reclamation.
Mr. BAXKIIEAD. In that connection. Mr. Ross, the Government has
appropriated, or there has been used from Government funds for
irrigation in the West. I understand, about S125.000.000. approxi-
mately.
Mr.' Ross. About that.
Mr. B \NKHF.Ai). What would you estimate the present actual
value of the lands reclaimed to be, the lands reclaimed by those
appropriations ( Is it twice the amount of the appropriations?
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 81
Mr. Ross. Oh, yes; I think it is estimated in the reports of the
Reclamation Service at about $500,000,000. This would be the value
of the property which would be assessable under the provisions of
this measure were it applicable to such projects.
Mr. SMITH. About five times the cost.
Mr. Ross. Almost five times the cost.
Mr. BAXKHEAD. That would indicate the absolute solvency of the
bond issue.
Mr. Ross. There is no question about that at all, and moreover,
under the form of organization provided, the loan value of the land
will not be impaired. It would only be impaired in the case of an
exceedingly expensive project, where the annual installment would
be very high, but in the case of a project that would cost. say. ?60 or
875 an acre, the loan value of the land would not be reduced anything
to speak of. You could go to the Federal Land Bank and borrow just
as if such bond issue did not exist.
Mr. BAXKHEAD. Now there is one other question I want to as\i you
here. The Smith-McNary bill provides for the payment of 6 per cent,
the total of the amount that will have to be paid in interest.
Mr. Ross. No; 5 per cent.
Mr. BAXKHEAD. I know.
Mr. Ross. There is no definite plan outlined for the repayment of
the district bonds.
Mr. BAXKHEAD. Five per cent. This bill provides for an addi-
tional 1 per cent.
Mr. Ross. Yes; for amortization.
Mr. BAXKHEAD. What is the difference in effect of those two pro-
visions. Mr. Ross (
Mr. Ross. Well, I do not wish to criticize the bill at all.
Mr. BAXKHEAD. I do not, either.
Mr. Ross. I think the Smith-McNary bill would be a very much
better measure if the provisions for repayment of the district bonds
were made definite and uniform and the payments strung out over
just as long a time as possible, because that is about the only ad-
vantage that can be given to the landowner, the reducing of his
annual installments.
Mr. SIXXOTT. Do you mean that they are not made uniform in the
Smith-McNary bill T
Mr. Ross. No; there is no provision which makes them uniform.
It says they shall be repaid over a period not exceeding 25 years, but
while most of the State laws provide a district bond that is paid within
a period of 25 years it is not paid under an amortization plan, but
the annual installments generally begin about three or four years
from the issuing of the bonds by the payment of 2 per cent, then 3
and 4 per cent each year, and so on up. So it would make quite a
substantial installment in a very short time, as against a maximum
installment under this plan of only 6 per cent.
Mr. SIXXOTT. Would it be a practical proposition to get a part of
the funds for a project from the reclamation fund, not paying interest,
and another part under this paying interest I It would, would it not 1
Mr. Ross. It would be entirely feasible; yes. The obligation I
mean the interest-bearing obligatign, would be measured by the
bonds that would be issued. It would be entirely feasible. There
would be no confusion at all.
5666421 6
82 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
Mr. SMITH. Do you think it is necessary, Mr. Ross, to wait until the
property values on a project are worth twice the cost before offering
the bonds, especially in view of the increasing value of the land as it is
brought up to a state of high cultivation ?
Mr. Ross. I think that you have first of all got to establish the
value of these bonds; so it is a pretty good idea, in my judgment, to
fix a standard in the law that fixes the value of the bonds beyond any
question.
Now, when a disinterested body like the Federal Land Bank ap-
praises the assessable property of a district and decides that it is
worth twice the par value of the outstanding bonds of such district,
then I doubt if there is any bond house or insurance company in the
country that would refuse to accept such bonds. They would be
glad to take them.
Mr. HAYDEX. The Federal Farm Loan Board is now required to
appraise the land and may only make loans for about one-half its
value ?
Mr. Ross. I think the standard is set out in the Federal farm loan
act.
Mr. HAYDEX. My recollection is that they may loan up to 60 per
cent of the value of the land.
Mr. BAXKHEAD. I think it is 50 per cent of the value of the land
and 20 per cent of the improvements.
MR. HAYDEX. We ought not to adopt a more lax standard than
that,
Mr. Ross. I think so. Later on, years from now, it might be
advisable to waive this provision, but at the present time I don't
think it would be well to do so.
Mr. HAYDEX. Do you believe there is a material advantage in
amortizing the payments, rather than to make payment of so much
interest and so much on principal, and keep the two payments
separate ?
Mr. Ross. It is a well established system of repaying a debt of
this kind. It is the basis of land credit systems the world over; the
repayment of loans under an amortization plan.
Mr. LITTLE. How many countries do that now (
Mr. Ross. The land credit systems of most of the countries of
central Europe do it.
Mr. LITTLE. How many ?
Mr. SUMMERS. What countries ?
Mr. Ross. Germany, and I think Poland. As you are perhaps
aware, most of the countries of central Europe have a land credit
system.
Mr. LITTLE. Which part of Gonna ny. the German Empire >
Mr. Ross. I think all of Germany as it was prior to the war.
Mr. HAYDF.N. I know that the amortization plan, prior to the
World War at least, existed in Germany, Austro-IIungary, Denmark,
and France. The Irish Land Purchase Act contained an amortiza-
tion provision, and I think the period of payment extended to 62
years.
Mr. Ross. Then all of the Australian states have such a plan for
the repayment of debts of this kind, as well as New Zealand.
Mr. BAXKHEAD. What Governments have adopted land settlement
schemes providing for amortization and government cooperation,
and providing funds ?
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 83
Mr. Ross. Well, the ones just listed by Mr. Hayden.
Mr. BANKHEAD. I know, biit in addition to that haven't Egypt and
India and Australia done that ?
Mr. Ross. The British Government has a plan for national recla-
mation in India that has been in operation for the past 50 years. A
very large percentage of the irrigated lands of India have been
reclaimed under government aid. In some cases part of the fund
is repaid through the payment of rentals or rates. I think that in
some cases funds are advanced without interest, but in most cases
they are repaid with interest, but at a comparatively low rate.
Mr. HAYDEX. Do you happen to know about the Assouan Dam?
Was that merely a gratuity appropriation?
Mr. LITTLE. I don't think that was any part of a plan like this.
They just built a big dam there.
Mr. 'HAYDEX. And paid for it out of public funds (
Mr. LITTLE. Yes.
Mr. HAYDEN. For the benefit of the country without any repay-
ment at all?
Mr. LITTLE. That is my understanding. It was built after I left
there, but they were figuring on it, and they built one at Assiout
and one at Assouan, and they already had the barrage north of Cairo
those three big dams. The barrage was built 75 years ago, started
by Mahomet Ali. It was built by French engineers originally. It
is just a government dam, and my understanding is that the others
were built just the same way.
Mr. SMITH. Just for the general welfare of all the people ?
Mr. LITTLE. Yes.
Mr. Ross. Is it not a fact that certain portions of the public reve-
nues are applied on repayment of the cost of this work?
Mr. LITTLE. Yes; that is my understanding. That w T as done after
I left, except the barrage above Cairo. That had been there a long
time.
Mr. BANKHEAD. I have forgotten, Mr. Ross, did you explain the
results of the operation of bill 6048 with reference to providing con-
tinuing and revolving funds for additional and future projects ?
Mr. Ross. Yes; I have tested out the plan very carefully, and I
have here a summary of results based upon estimates which are set
out in detail. They consist mainly of figures, and if I may hand
them to the secretary I would like to have them included in the record.
The CHAIRMAN. Without objection, they will be inserted in the
record.
(The papers referred to follow:)
BALANCE SHEEP SHOWING OPERATIONS UNDER THE COOPERATIVE RECLAMATION AC1 ,
H. R. 6048.
For the purpose of illustrating operations under this act it is assumed:
(1) That an appropriation of Sl.ooo.ooo \vill be used for the construction of a single
project.
(2) That the period for such construction will be four years.
(3) That the amount of interest which will accrue during this period is 10 per cent
of the money actually expended on construction.
(4) That this accrued interest will be added to the amount actually spent on reclama-
tion, and that district bonds will be issued to this amount. This issue will then be
110 per cent of the amount actually advanced from the appropriation or $1.100.000.
(5) That ten-elevenths of this issue, or $1.000.000. will be sold to the investing
public, the proceeds to be used for the reclamation of other land. Therefore, since
84 DEVELOPMENT OF AGKICULTURE IN THE UNITED STATES.
the installments of interest and principal collected for the repayment of these bonds
will be paid to the purchasers of such bonds, such installments will not be taken
account of in these estimates.
(6) That one-eleventh of the total amount of bonds issued, or $100,000, will be
deposited in the fund and that the amortizing installments which will be paid on same
amounting to h p-?r cent, or ?6.000. will be available for the repayment of the appro-
priation. "Also that a similar amount of bond? will be retained in the fund from the
issues of each of the projects of the second, third, fourth, and other series which will
be constructed as indicated on the balance sheet, and that the amortizing installments
that will be paid on same will also be available for the repayment of the appropriation.
(7) That an annual assessment of I per cent of th? cost of the project will be paid
into the fund by the district during the life of its bonds, to be applied on the appropria-
tion. Thi- assessment is to begin one year after th n completion of the project. Also a
similar assessment will be paid by the projects of the second, third, fourth, and other
series, as indicated, to be used for the same purpose.
(8) That repayment of advances made from the appropriation to the project shall
begin 10 years after t!ie completion of such project. This will be about 1") years from
the elate of th^ first advances.
A- will b^ noted on the bala?ice sheet, it is assumed that two years after the com-
}.>]ftion of the project, or six years from the beginning of its construction, the bonds
of the district will be sold, such op?ration to be repeated in the case of each district
subsequently organized. Thus, the appropriation will be "turned over" every >)ix
\\-ars. The siiinmars giving results to the end of the forty-eighth \ear shows the
amount of construction which may be done by the end of each six-year period.
DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES. 85
86 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
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Annii 1 amortizing Installments of ln.ooo, bein^ (IIHT (rut on $
old .triet 1 onds i one-eleventh ol lolal ; uc retained in fund,
pai< in 36 Installments. Similar installments will i e paid toil
in 1 c >ame prop.iiii-ui oflhc bonds ol the second, third, four!
oth series ol projects Ihal uill le ov^aiii/c'l in turn as ind
Tin e Installments will be as follows: Annual amorti'int,'
me ts of r, |M-r cenl of *1(M1,IKM1 i olie-elevenl h of total bond i
(list iel :.
h rst scries ...
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Totals (accrue<l amount of fi per cent installments) , .
1 per cent of the cost of the project , amounting to $11,0
paid into 1 he fund each vear during t he life of l.hc bonds an
pa.Miicnl will lie made im projects of the sciics, which wi
shown: A nnual payments of t be cost of 1 he project
Kirsl scries
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Accrued amount of all Installments
Amount duo
Credit balance
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DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 87
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il olal issue) ret
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88 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
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u\erage dale of advances to end of fourteenth year: SISO.OIKt
Amort i/ing installments of $'K),00(), being ti perceni of Ihe appro-
priul ion of $1 .(XXl.lMM)
These installment spay Interest al 1 per cent , alsothe accrued inter-
e<t to (he fourteenth year
Receipts:
Annual unorl i/.inu installments of $!i.(K)(t, beini;(i pe-cenl on $100,000
of district binds (one-eleventh of K'lal i^suc) retained in fund,
will he paid in '.V'< i list ailments. Similar Installments \\ ill be paid
to Ihe fund in the same proportion of Ihe b .nds of Ihe se,' Hid.
third, fourth. and other series of projects 1 hat will be organized in
turn asindicatc 1. These installments will heas follows: Annual
umorti'/.ing installments of (i per cent of $100,0(Mt uinc-uHHbith of
total bond issue of district)
First scvie 1
Se 'ond series
Thin! scries
11,000, will he
bonds and a
es, which will
le project
1
Foiirl li series
Fifth series
si \ i h series
Seventh series
Eighth series
Total (accrued amount of (i per cent installments!
1 percent of the cost of the proje/l . amounting to!
paid into the fund e i-h \c ir dm in- Ihe life of 1 hi
similar payment v ill be made on projects of the set-
follow as shown: Annual payments of the cost of t
First ,,..,,
y
- E.'
d
\ moil n 1 due
Cre lil h'llanee
N install men Is due on appropriation
Payment could he made forty-eighth year, loavi
90
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
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DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 91
Mr. SINNOTT. Mr. Ross, in section 20, page 13, on line 21, and so
on, it provides: "That all reclamation projects or units thereof upon
which actual construction work shall be commenced after the passage
of this act shall be organized in the manner provided herein." Now,
what does that mean "shall be organized in the manner provided
herein" ?
Mr. Ross. Organized as districts.
Mr. SiNNOtT. Then a Government reclamation project that was
not organized into a district could not secure any money under this
act?
Mr. Ross. Well, the definition is quite clear as to what projects
shall organize as districts. It says that all reclamation projects or
units thereof upon which actual construction work shall be com-
menced after the passage of this act shall be organized in the manner
provided herein.
Mr. SINNOTT. There is no " manner/' in my opinion, as to the
organization of anything under this act, except that it is only dis-
tricts or minor subdivisions of a State which may apply to the Sec-
retary. But the act itself does not provide any manner of organiza-
tion. I think that language is somewhat loose and ought to be made
clear.
Mr. Ross. Is that the way you understand it ?
Mr. SINNOTT. Yes.
Mr. Ross. Well, I may possibly be so familiar with it that that idea
did not impress my mind, but it might be necessary to make it a
little clearer by referring to the section of the bill which outlines the
plan of organization which must be followed.
Mr. LITTLE. Would the passage of either of these bills interfere
with yours, Mr. Smith, or yours, Mr. Bankhead ? Is there a conflict
between the Smith bill and the Bankhead bill ?
Mr. BANKHEAD. Yes; there is a conflict in this, Colonel, that the
Smith bill only provides for the lending of Government credit or the
appropriation for the arid lands, or semiarid lands, of the West; my
bill proposes Government cooperation for lands everywhere in the
country, either for irrigation or for reclamation by drainage. That
is the essential difference.
Mr. SINNOTT. Under section 7, Mr. Ross, the authority contained
in the Federal farm loan act, and so on, "is hereby extended to pro-
vide for the discharge of the duties of the Federal Farm Loan Board
as specified herein. Have you in mind what particular authority
is referred to there, what particular provisions of the Federal farm
loan act will be invoked ?
Mr. Ross. Well, if you recall the provisions of the farm loan act,
they place large powers in the board, and this simply adds to the
authority, the general authority which they already have.
Mr. SINNOTT. What I had in mind was what specific authority in
the Federal farm loan act this section would take advantage of.
Mr. Ross. I think that where it states that the authority contained
in the Federal farm loan act of July 17, 1916, and acts amendatory
thereof, it would simply add the duties provided in this bill to such
duties as are not now enumerated in the Federal farm loan act.
Mr. HAYDEN. Would it not be better to direct the Federal Farm
loan board to perform the acts authorized by this bill ?
Mr. Ross. Well, it might be stated that way.
92 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. HAYDEX. Then we would not be extending any general law in
a way which might later cause confusion.
Mr. SINNOTT. You are applying the entire Federal farm loan act
to this.
Mr. Ross. It says, ''is hereby extended" such authority as is
now contained in the Federal farm loan act "is hereby extended to
provide for the discharge of the duties of the Federal farm loan board
as specified herein." I don't see where there is anything confusing
about that.
Mr. BAXKHEAD. Well, if there was any confusion it could be
amended to confine it with reference to the sale of the bonds, etc.
The CHAIRMAN. Were there some other observations you wish to
make on the bill ?
Mr. Ross. There is this, Mr. Chairman, as I see this movement
this movement for the reclamation of lands which is obviously
gathering a good deal of force, has gathered great force and interest
during the past two or three years, I can only think of it as being
based upon a national need and not a sectional need. I think per-
haps one of the weakest arguments that could be offered to-day in
support of this movement is for, say. the western people, my own
section of the country, to say that " We want Congress to appropriate
a large sum of money because we want to extend our irrigation: or
want certain lands reclaimed." Or for the South to say. " Wt> want
Congress to appropriate because we want certain lands drained." I
believe that the strongest claim that can be made for Government
assistance should be based upon a national need which now exists for
extending our home building upon the land. Agriculture has not
that thing within itself which enables it to extend itself. Agriculture
is not like other industries; while it is the greatest of all the industries
it is unlike the great modern industries of to-day. It is divided into
about 7,000,000 units, totally unorgani/od. We might say to the
farmers or to the man out of employment. "If you want land re-
claimed, go and reclaim it." But how is he to reclaim it (
It is beyond the power of the individual to go out and reclaim a
large body of land, to bring it under cultivation so that more homes
may be built; and for that reason the responsibility devolves upon
the' public itself, upon the State, or the Federal ^Government, to
provide facilities so this work may be done.
If we had millions of acres ready for the plow, as we had years ago,
then you could say to the farmer or even to the man who was out of
a job in the city. "Go out and file on a homestead." But you would
simply be mocking him. He can't do it. Such land no longer
exists. The only land that is available that is fit for agriculture is
the land that has to be reclaimed by some process or other, and such
work is beyond the power of the individual. Also, as 1 see it, it
doesn't make any difference where such land may be so long as it is
within the United States. Interest in the subject of rural home
building does not begin west of the one hundredth meridian, nor
docs it begin on either side of the Mason-DLxon Line; it is common to
the entire country. I also believe that before any legislation of this
kind I mean a program of the magnitude that we are now consider-
ing will be indorsed by Congress, that we have got to arouse more
than a sectional interest in the subject, for when you appeal to the
great industrial interests of the East that are now in such distress,
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 93
their interest will not be as to where this work is to be conducted ; for
their interest will be to have it conducted in all parts of the country,
for only by extending the building of rural homes and putting people
In possession of the land resources of the country can we extend our
home market, and I believe this is what our great industries must
interest themselves in to-day in order to recover their balance.
Mr. HUDSPETH. If I understand the provisions of Mr. Smith's bill,
it applies to those States only that have public lands within them?
Is that it ?
Mr. Ross. Automatically so; yes; because it only provides for
reclamation by irrigation.
Mr. HUDSPETH. The great State of Texas, then, wouldn't come
under the provisions of his bill !
Mr. SMITH. Yes; it applies to all of those States mentioned in the
reclamation law.
Mr. SIXXOTT. You did not understand Mr. Ross's answer, I think,
if his answer was correct. He said "automatically," because it is in
the irrigation States that they have public lands.
Mr. HUDSPETH. I know reclamation was extended to that State
years ago.
Mr. ^IXXOTT. It applies to any State that may be irrigated:
Mr. HUDSPETH. Mr. Bankhead's bill covers drainage and cut-over
lands.
Mr. Ross. And irrigation. It is a national measure: and more-
over, its operations may be continued indefinitely; also every dollar
that is appropriated by Congress will be repaid with interest/and the
fund will gradually augment.
Mr. SIXXOTT. Are there many States, Mr. Ross, where drainage is
feasible, that have State laws that would supplement or enable them
to cooperate under this act ?
Mr. Ross. Yes; practically all of the States have drainage laws.
Mr. SIXXOTT. I know thay have drainage laws, but have they laws
enabling a State district to cooperate with the Government ?
Mr. Ross. Xo, not all of them. Some have. Some made special
provisions a vear or two vears ago in anticipation of the passage of
the Mondell bill.
Mr. BAXKHEAD. It will only be a short time, however, if this
bill should pass, involving national policy, until all the legislatures
would pass laws of that sort.
Mr. Ross. Yes, it would be necessary for most of the States to
pass what might be called "enabling acts," and it will be necessary
for them to slightly amend their district laws so as to issue the par-
ticular kind of bond that is contemplated here. And I think that
is very desirable, because then there will be uniformity in law and in
the bonds and the steps that will have to be taken.
Mr. HAYDEX. In your judgment there will probably be the same
effect in the case of the Federal aid road act where there were pro-
visions for cooperation with the States. In order to obtain the benefits
of that act certain States had to pass laws by their legislatures;
other States even had to amend their constitutions, but they all did
whatever was necessary.
Mr. Ross. Yes.
Mr. BAXKHEAD. The same experience obtained when the Smith-
Hughes vocational training bill was passed. Every State in the
94 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
Union in a very few months had adopted laws to conform, enabling
acts as you mentioned, to conform with the Federal law on that
subject.
Mr. Ross. Yes, sir.
Mr. BAXKHEAD. Xow. are there any other sections besides the
South where there are lands available under this act, besides the
West and South ( Aren't there considerable areas in some of the
Lake States ?
Mr. Ross. Yes. there are considerable areas of cut-over lands in
Minnesota, Michigan, and Oregon; in fact, wherever great pine forests
used to stand there are areas of cut-over lands that would be available
for settlement.
Mr. SMITH. What would you think. Mr. Ross, of the idea, in order
to interest the States hi these reclamation projects, of making it a
condition that the States must pay the interest on these district
bonds until the time when they can be sold, instead of imposing that
interests on the settlers, who will have had no benefit from the project
until the water is actually available, covering a period of probably
four years '.
Mr. Ross. I think we cover that period, Mr. Smith.
Mr. SMITH. No, you charge the interest up to the settler. You
capitalize the interest and charge it up to the cost, and it seems to me
that the States in order to get a project would be willing to bear that
burden and cooperate with the Federal Government and with the
settlers, so as to put the settler on the land without any accumulation
of interest which he must eventually pay.
Mr. Ross. Well, if you will examine the plan carefully you will see
that it is necessary that a fund be accumulated from some source or
other in order that the appropriation may be repaid. Xow. under
this scheme we can't eat our cake and keep it too: we can't sell the
bonds for the reclamation of other lands and at the same time repay
the appropriation. If we keep our construction fund intact and repay
the appropriation, then we have got to provide by some means a fund
which will slowly accumulate, that will ultimately repay the appro-
priation, provided we want the work to continue.
Mr. 1 1 AYDKX. I think you misunderstood me. Mr. Smith. Plis idea is
this: Say, that S10,000,000 is set aside for the construction of an
irrigation project, and that it will take four or five years in which
to build the reservoir and the diversion dam and the canals and
actually get the water to the land so that the water user may have
an income out of which he could pay interest on the money advanced.
During the period of construction the money is in use: it is out of the
Treasury of the United States and interest is being charged. Under
the terms of both of these bills such interest may be added to the
cost of construction and from then on the payments begin. It is
Mr. Smith's idea that it would be of enough advantage to the States
by having new taxable wealth created that they might assume the
obligation of paying interest on the money advanced during the
perioe of construction, up until such time as the settler was in condi-
tion to assume payment.
Mr. Ross. Yes. I understand what Mr. Smith was saying, and I
repeat again, that we must provide some fund for the repayment of
the appropriation. Xow. it happens that when we allow the interest
to accrue and capitalize it, and then issue bonds including this amount .
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 95
we can impound such amount in our fund and then sell all of the
bonds which represent the amount actually advanced from the
appropriation. But we can't do this unless we provide some special
fund.
Mr. SMITH. But it would be all the same, if the State appropriated
this money and paid the interest on these bonds during the con-
struction period, as if it were charged up to the settler who is to pay
it back over a long period of time.
Mr. Ross. Yes, that is so, but of course you must realize the diffi-
culty of securing the approval of the States to any plan which involves
their liability. In most cases it would be necessary for them to amend
their constitutions; most State constitutions specifically prohibit
such a policy.
Mr. BAXKHEAD. Here is another objection to that. You take the
reclamation of a project by drainage that involves, say, onl} r one-
tenth of the area of a State, probably less; It would go to improve,
of course, the value of the lands in thet particular section, and the
rest of the State, the property owners of the State, the taxpayers of
the State, would not derive any benefit from it.
Mr. HAYDEX. They would be interested this much, that you are
creating new wealth which will be taxable for all time in that State,
and thereby reducing the burden of taxation upon the remainder of
the property.
Mr. BAXKHEAD. That is true academically, but from the political
standpoint if you wanted to change the constitution of a State for
that purpose I apprehend that in my State at least we would have
great difficulty in securing it.
Mr. HUDSPETH. It has to be done by a vote of the people, Mr.
Bankhead, and it would be mighty hard to get five-sixths of the State
of Texas to change the constitution for the benefit of the other one-
sixth.
Mr. LEATHERWOOD. Or any other State that might be affected.
In my State you couldn't do it.
The CHAIRMAX. It is 12 o'clock, gentlemen. I am sure the com-
mittee will profit by the presentation made here by Mr. Ross, based
upon the wide experience he has had, and I thank Mr. Ross for his
valuable presentation.
Mr. Ross. I desire to thank you, Mr. Chairman, for the privilege
of appearing before this committee.
(The following letter was ordered inserted .at this point:)
WASHINGTON. I). C., May 26. 1921.
Hon. MOSES P. KIN RAID.
Chairman Irrigation of Arid T.nn'is ' 'ommittee,
House of Representatives, Washington, D. C.
MY DEAR MR. KINKAID: I shall be greatly obliged if you \vill include in your
records of yesterday's hearings the following statement, being an amplification of my
discussion of the reasons why Congress should authorize the Government to lend its
cooperation in the work of rural home building in this country.
Very truly, yours,
D. W. Ross.
WHY CONGRESS SHOULD ENCOURAGE THE ESTABLISHMENT OF RURAL HOMES.
A turning point in u'orld affairs. Without doubt we have arrived at one of the
great turning points in world affairs. The cause of present disappointments and
distress being so deep seated, alleviation will not be found by continuing the course
which we, along with the rest of the world, have for many years been pursuing, but
96 DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES.
rather in the opposite direction. What is first needed is that the world shall come
out of its present madness and earnestly seek for a solution of its troubles. If this lie
done, relief will be found and close at hand and it will be permanent because it will
be in league with, and not opposed to. nature.
We are still living on a very material plane, and the spirit of imperialism that has
ruled the world through all the ages still expresses itself through the world's most
absorbing interests. To-day the things of srreatest human concern are commerce
and indus'ry, and the shaping of nation-.il policies in the effort to control these two
great human activities will determine the destiny of the race. The overindustrial-
ized condition of western Europe and America that was established before the war
began was the result of this spirit. The most noticeable effect of this condition was
seen in the overdevelopment of our great cities and industrial centers with a corre-
sponding falling off in agricultural population which was most pronounced in the
United States. The successful maintenance of this recent redistiibution of popula-
tion depended above all else upon maintaining the peace of the world. In this we
failed, and a new set of conditions and rel.it ions have resulted, not counted on by
those who plan wars.
Ito. The war left the United States the world's creditor Nation.
With the currency of European nations at prewar standards, the readjustment of our
trade balances to normal by the gradual absorption, through imports, of the debts
due us. now amounting to nearly 120,000.000,000 and rapidly increasing, would be
a colossal undertaking, but with the money standards of these countries degraded
beyond hope of redemption such accomplishment by means of existing trade machin-
ery is well-nigh hopeli-ss.
The most potent factor in the present trade situation is the degraded condition of
the currency of European countries, a condition which is greatly against such coun-
tries when Inning from us. of tremendous advantage to them when selling to us. but
no great impediment when trading with each other.
Because of the misery which is the common lot of the people of Europe, never
before has the United States, in my opinion, occupied a more precarious position in
the industrial world than it does to-day. We must remember that Europe has nearly
three times the man power that we have in th-:- arts, crafts, ami industries; th.:i thV
people are getting back onto their feet; and. what is of still greater importance, they
must live. But the international standard of money value which makes it very diffi-
cult for Europe to buy from us makes it still more difficult for us to compete with
Europe in other fields.
The immediate effect on the United States of the European breakdown was the loss
of a market that had absorbed the surplus products of the American fanner for more
than 60 years. This loss impaired the purchasing power of our entire farming popula-
tion of about 40.000.000 people, which in turn reacted upon our industries, tfien upon
labor generally, the inevitable reduction of wages causing further industrial reaction.
However, the end has not yet been reached, for we are still on a relatively higli plane.
But with every reduction in wages there will be a corresponding reaction on the indus-
tries, and this will likely continue for many stages, the last stage being the level of Euro-
pean conditions, toward which we now appear to be heading. And to make the meas-
ure of these adverse conditions full to overflowing, we will labor, perhaps for many
generations, under the crushing weight of a war debt that is more likely to iin
than diminish.
The foregoing are some of the outstanding conditions that have resulted from the
war. The continuation of these conditions is as opposed to a return of prosperity as
is ignorance, famine, or pestilence. Credits, banking, etc.. are only the vehicles or
means to facilitate the exchange of commodities. Relief must be had from the con-
ditions themselves before prosperity can ever again be permanent.
The road to recovery leads to the I ind. Now. how can relief be found from the present
economic conditions which are now world-wide and which promise to bear more
heavily upon us as time goes on? There is but one main road to recovery, but it
does not lie in the direction of the course we have been following, and which has
ended so disastrously. However, it will still carry us forward, for it leads to the great
unappropriated resources of nature in virgin fields.
It is estimated that le-s than 15 per cent of the cultivable land of this planet is now
in use. However, like cattle starved to madness, we are crowding for possession of
overgrazed or impoverished pastures when just over the mountain or across the river
are boundless areas of green meadows waiting to be utilized*. The people of over-
crowded Europe will only find relief through their migration by millions, not to this
country i for such a move would be suicidal), but to new and virgin fields, and there
developing and using the land, minerals, and other natural agents of production.
And for the same reasons the congestion of population in our own great cities can
best be relieved by the removal of millions of people back to the land.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 97
Now, it is upon the use of natural resources, especially the land, that the wealth
of the world has always been based, and such a movement as this to engage in the
development and use of more of nature's resources, especially in virgin fields will
provide opportunities for millions of people to become nation builders instead of
nation wreckers. They must be encouraged to leave the cities and occupy the open
and now unused places. They should be placed in possession of fertile land, not,
however, with the idea that they will accumulate great riches, but rather that they
may become the owners of homes, and establish economic independence. Their
citizenship, no matter under what government they might live, would then be in-
vested with a dignity which is lacking under present conditions, while the creation
of these new homes will add proportionately to the safety of the world.
The United Stales should continue the development of its own land resources. If mil-
lions of Europeans had not come to America when its great resources were practically
undeveloped, we would not be a great Nation to-day, and these millions or their
descendants would to-day be adding their misery to the misery of the others in un-
happy Europe. It would, indeed, be hard to tell how much the world has gained
through the development and use of our great natural resources. We do know that
this development made this a mighty Nation, and for this reason it should be plain
that by the further development of these resources we can be saved in the present
crisis.
Of all the great natural resources that were appropriated and used, it was the utili-
zation of the vast areas of land for homes to which this country owes most of its present
wealth and power. But all of the land that may be put to a profitable use at nominal
expense has already been appropriated and only land that can be made fit for use
at great expense is now available. This is the poorer land that has been abandoned
for various reasons, much of which will have to be recleared, heavily fertilized, or
otherwise rehabilitated, and the very fertile lands that will have to be reclaimed
by means of irrigation or drainage before being fit for cultivation. The reclamation
and rehabilitation of these lands would furnish employment and provide homes for
millions of people, while the general advantages that would result from the utiliza-
tion of this great resource would be similar to that which followed the appropriation
and use of the hundreds of millions of acres of public land 25 to 60 years ago.
It is most unfortunate, however, that such work can not successfully be done without
the cooperation of the Government and States. It is because of this fact that a moun-
tain of difficulty appears upon the horizon of our hopes, for neither the Federal Govern-
ment nor the States may even entertain the thought of such cooperation except at the
risk of parting with our highest and dearest ideals and sinking to the leval of those
enlightened Governments whose policies bear the stigma of "paternalism." Even
some of the policies of our Government have been thus stignatized, causing many of
our leading citizens to blush for shame. One policy in particular is thus branded
because, in pursuance of it, the Government has converted nearly 2,000,000 acres
of once worthless desert land into homes for more than 250,000 people whose gross
annual earnings now amount to more than the total cost of this transformation. But
although this adventure is admitted to be a splendid success, the lands now having
a value equal to five times the amount of money loaned by the Government for the
construction of the great engineering works that were necessary, there are many who
still consider the policy very mischievous.
However, when the Government, prompted by the spirit referred to, appropriates
billions of dollars that ships bearing our flag might control the commerce of the world,
such policy is acclaimed as expressing the highest ideals of Americanism. And the
public is expected to uphold this view regardless of the fact that nearly one-half
of the beautiful ships that have been constructed at public expense are no'w floating
idle and empty in their docks.
Trade ambitions, commercial rivalries, Government subsidies, ruinous competition,
national jealousies, race hatreds, preparedness, bigger navies, imperialism, war's
destruction, degraded currency, profiteering, inflation of national assets and liabilities,
deflation of assets, new national liabilities sustained by national honor, crushing
public debt, unprecedented burden of taxation, famine, pestilence, Governments
overthrown, idle ships, idle factories, breakdown of commerce and industry, millions
of unemployed, reconstruction and then repeat! These are expressions of the spirit
of domination that has been breathed into modern industry. We of to-day are witness-
ing the utter failure of this, the spirit of our times. The same spirit has brought ruin
to the world a thousand times in the past and will continue to destroy in all the years
to come. But the most terrible consequence of the present failure is the failure of
industry the Jacob's ladder of our hopes fallen by its own weight! Instead o?
lifting the world out of its miseries it threatens to plunge it to miseries unheard of.
5666421 7
98 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
From time to time enlightened governments have turned their attention to the work
of strengthening the foundations of society by making it possible for more of their
people to own homes on the land. While many policies of such governments have
been marked by failure, history does not record that this beneficent and farsighted
policy has, in a single instance, failed in its purpose. I am fully convinced that, just
as the salvation of the people of Western Europe depends upon their migration, by
millions, to virgin fields, the recovery of our own industrial equilibrium and the
future safety, prosperity, and happiness of the- people of this country can only be
assured through the development and use of more of our own natural resources. But
these must be developed with a view to establishing the dignity and economic inde-
pendence of the maximum number of our citizens. The ownership of a home adds
dignity to citizenship, while a home on the land is perhaps the most natural as well as
the most effective means of establishing the economic independence of its owner.
It seems hardly necessary to urge in this connection that any law authorizing the
Government to lend its cooperation in this work should be sound' from every economic
standpoint. It is work that will have to be continued for many years, therefore the
financial devices employed should make it self-continuing, something like the Federal
farm-loan system. Also, that these homes should be established, not in any one
locality or section of the country, but wherever land can be found suitable for the
purpose, in any part of the United States. The urging of a makeshift plan or un-
willingness to see beyond geographical limits is a confession that we are not quite
equal to the tasks which lie before us. The Bankhead bill contains all the desirable
features of legislation for this purpose.
The CHAIRMAN. The committee will now stand adjourned.
(Whereupon, at 12 o'clock noon, the committee adjourned.)
COMMITTEE ON IRRIGATION OF ARID LANDS,
HOUSE OF REPRESENTATIVES,
Thursday, Junf j, 1921.
The committee met at 10.30 o'clock a. m., Hon. M. P. Kinkaid
(chairman) presiding.
The CHAIRMAN. The committee will come to order. I should state
that Gov. Spry is very ill, the Commissioner of the General Land
Office, or he would have been here this morning to present his views.
The committee will he glad to hear you now. Mr. Jones. Will you
please state your residence ard whom* you represent ?
STATEMENT OF MR. RICHARD SEEIEY JONES, EDITOR OF
THE STARS AND STRIPES, WASHINGTON, D. C.
Mr. JONES. I am editor of the Stars and Stripes, a weekly news-
paper published in Washington, D. C. I presume that the committee
wants my views, or rather what information I might have from the
ex-soldier point of. view on the bill that you have before you, H. R,
2913.
The CHAIRMAN. You are acquainted with the bill, are you '.
Mr. JONES. Yes; 1 have read the bill rather carefully.
The CHAIRMAN. And you are acquainted particularly with the
section that refers to ex-service men, giving them a preference right *
Mr. JONES. Exactly. In that connection I will say that my judg-
ment as editor of a weekly newspaper of 140.000 weekly circulation
among ex-set vice men of the World War is based entirely upon the
opinion of ex-service men, and for that reason I have given consider-
able attention to this legislation, not only this legislation but all
legislation affecting the ex-service man.
I think in considering the provisions of this or any other bill, in so
far as they relate to the discharged soldier, it is very fair to go a little
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 99
bit back of even the post-war period in which a great many land bills
and bonus bills and other bills intending to help the ex-soldier have
been proposed, and go back even to the time 01 service in the Army
of the emergency soldiers of the World War. It was my experience,
and I think every other soldier's experience who was in the Army for
practically the entire period of the war, that prior to the armistice,
during the period of our active service, the only thought which the
soldier had of any reward, any material reward for his military ser-
vice, was that he would receive land in some form. The reason that
that was his only thought was that there was no experience from past
wars to base any other thought on.
In other words, American soldiers of the United States Government
in previous wars have received two things, pensions and land, in vary-
ing degrees. The presumption during this war was that the war risk
insurance act was designed to eliminate the necessity or the reason
for pensions or for a pension system. That was going to take care of
the disabled soldier, so designed, and I presume it is still intended to.
However that may be, the belief in the minds of every soldier that I
meet and I met them constantly, of course, from the day I enlisted
until I was discharged, in this country and France under all sorts of
' conditions that somehow out of this war the financial disadvantage
which the soldier endured by reason of his service and being away
from his occupation, and so on, would be compensated by getting
hold of some land, by getting land ownership. That, I believe,
extended from professional men, men of ability, and perhaps of some
men of means down to the soldier with absolutely no means. I have
heard it from men of foreign birth in our Army who came out of fac-
tories in the eastern States and knew nothing about western lands
particularly, but had that idea that as a reward of this military service
they were going to get a freehold in the land. Perhaps the foreign-
born man is just as keen or more keen for that than the native born,
and I think that basis is well to bear in mind in considering any
proposition that tends to or endeavors to put the soldier on the land;
that before he heard of any other compensation or thought of any,
he had that firmly in mind, and I think it is still firmly in the mind
of men who have'not expressed it very fully since there have been a
great many other plans developed.
I take it that your bill here is not a bonus bill or a soldier's com-
pensation bill; it is primarily a reclamation bill, a land-development
bill, but as it affects the soldier he is just as much interested in it as
in any other proposition that can be brought up for the compensation
or the reestablishment of the veteran on a basis where he can have a
chance equal to the man who was not in the military service.
Mr. RAKER. Just in line with that, about what percentage of the
ex-service men do you believe are desirous of securing some sort of an
arrangement whereby they can get a home on the land ?
Mr. JONES. Well, to get a home you mean to get a farm ?
Mr. RAKER. Yes.
Air. JONES. Of course, you include in getting a home you could
include all of them, because there have been bills, such as the first
bill, which was the Dick Morgan bill, the late Congressman Morgan
of Oklahoma, which was a land farm and home loan, a loan for a
city home. That bill was considered two years ago and every soldier
that ever heard of it was in favqfrof it. A study of it simply meant
100 DEVELOPMENT OF AGRICULTTJEE IN THE UNITED STATES.
every soldier. The onlv figures that are available on the demand for
land are those in the United States Land Office, particularly in the
Reclamation Service, where they have had more than 350,000 letters,
and up to the last letter I had from Mr. Davis of the Reclamation
Service they were then getting 50 letters a day of inquiry from sol-
diers, ex-soldiers, about the possibility of getting land.
The CHAIRMAN. That is a year or two ago, though?
Mr. JONES. Xo. that was within two or three months that they
were still getting them: not at the rate they had been, because the
men had been discouraged and the land office has in the nature of
things been obliged to discourage them. Now. our experience with
land, personal experience through our newspaper, which reaches
practically every post of veteran organizations all over the country
and is pretty closely in touch with them, indicated from the first land
opening after Congress had enacted something over a year ago a bill
allowing 60-day preference to all soldiers on any land, any public
land that was tnrown open that law is still in effect I think it was
a two-year law it expires in about a year, and I believe there is
now a bill before Congress to extend it, aside from the preference
given in this 2913. The Shoshone project and the Xorth Platte proj-
ect, two irrigation projects in the Western States, were opened suo-'
sequent to the enactment of that preference. On one of those proj-
ects there were about 3,200 applicants who actually paid their
money; that is, the deposit on the water- right payment, which
amounted to more than $1,000,000. There were exactly 80 farms
available in that project; 80 men could get a farm, but "there were
3,200 men who went there and made payments. I don't know how
many more men looked it over and were discouraged after they got
there. Our newspaper naturally received a great man}- letters about
it, principally complaints that the lands had been advertised and
had been announced and soldiers had gone there without knowing
what a meager chance they had of getting any land. We were unable
to do anything in that case because a good many people had spent
their monev and taken their chances and even made their deposit.
Of course tney got their deposit back and that was the end of it.
The next land that was opened was in the State of Oregon. That
was about a year ago this time. The North Platte and the Shoshone
was a year ago in March, I think. There was a big tract around
Ashland, Oreg., not irrigated land. This was not a reclamation proj-
ect but simply Government land. We began to get inquiries about
that from the date the first announcement was made, and we sent
bur correspondent from Portland, Oreg., down to look it over. He
reported that there was no land there, except what had been taken
by squatters, that was any good, that was tillable soil. The rest of
it was hillside or rocky, or "otherwise unsuitable, and it would be very
unwise for a soldier to go there. We advertised that fact, and the
chamber of commerce, I think it was Ashland some town in Oregon
nearlv to the line took a very public-spirited attitude and adver-
tised "the fact that soldiers should not come there. Instead of the
usual chamber of commerce promotion that everybody come, they
actually advertised widely that it was futile for men to come there,
but despite that a number did go and we had our own paper to make
that statement and probably other^oldier publications did the same,
and were instrumental in keeping*!! great many men, I don't know
DEVELOP MESTT OF AGRICULTURE IX THE UNITED STATES. 101
how many, but probably thousands of men were kept from spending
their money going there to try to get land.
I just recite these definite instances to show you how keen the
demand is still among ex-service men for land. The development of
proposals to pay a soldier's bonus, I think, has to a great extent
diverted the interests of many men from the possibility of getting
land.
Mr. RAKER. What is your theory you have investigated the
matter pretty thoroughly relative to the real genuine benefit to the
soldier and the country by arranging so as to get him a farm, as
compared to a cash bonus ?
Mr. JONES. Well, there can be no question in the mind, I think, of
anv fair-minded person that the advantage both to the individual
and to the country is much greater in obtaining a farm or an oppor-
tunity to get a farm, or to get a home and produce in his own name
and in his own right than any cash bonus would be. I will say that
you have got to bear in mind that I don't think this bill or any other
bill could provide a farm for every ex-soldier, and if the purpose is
to compensate every man, I doubt if there is any sort of a land bill
that could be devised, or any kind of reclamation project that would
take care of 4,600.000 men. '
Mr. RAKER. Don't you think it could be devised to take care of all
those who desired to get a home and in speaking of a home now I
use it where he can get himself a house and get land to till in connec-
tion with it, so that he can rear his family and do business in con-
nection with his farm or in the adjoining town, wherever he may lie.
Mr. JONES. I will say that I think this bill here will provide more
good, practical farm land than any bill that I have seen in the last
two years since the war, but there will be more soldiers looking for
land under this bill than the bill will provide for some years to come,
if this bill were enacted, which I think is the best one that has yet
been offered from a practical standpoint. It seems to have been
drawn by people who understand the land situation. I have worked
on farm land and irrigated valleys myself, and know something about
it : and also it is the most liberal bill to reclaim and make available
the greatest amount of land of any bill I have seen yet. but if this bill
were enacted in its present form, with all the appropriation provided
for, there would be more soldiers clamoring for every farm you
opened up for a number of years to come than there would be farms
available.
Mr. RAKER. Well, would you include in this the handling of the
swamp land, the cut-over land, whereby these men can get homes and
develop the country as well ?
Mr. JONES. I would be glad to see that included, if it can be in-
cluded, in as practical a manner as the arid land features are included.
I will say about that of course, I am not a land expert, and the
members of your committee know more about it than I do, but I
happen to know by my own experience something about the value of
arid lands in some of the Western States when the water is put on
them. I know that the increase in the value of the land by mere
means of putting water on it is so great that if that increment goes
to the settler, and if he is a reasonably energetic fellow, he is pretty
nearly sure to make good on that land and pay for it. How practical
the swamp-drainage proposition is I don't know, but assuming that
102 DEyELOPMENT OF AGRICULTURE IX THE UNITED STATES.
it is equally practical, it certainly would be equally advantageous to
the ex-soldier.
Mr. RAKER. Now, let us take just the provisions of the bill relat-
ing to the arid and semiarid lands. It seems like everybody that has
had any experience and knows anything about what this land will
do knows what can be done on it with benefit to the Government
generally, the State, the local community, and the man himself: why
is it, from your observation, that we can not get consideration from
our large eastern contingency to help us out, to develop what we
know has been done for the last 30 years and more > That is what
we need in this, and that is what we want. There aren't any of us
but what know the benefits of irrigation. The question is that we
want to get something whereby we can get this bill through and get
to work; and what is the matter?
Mr. JONES. Well, that is something that probably the members of
your committee have encountered as much as I have.
Mr. RAKER. No; now, the question is, you are representing a great
organization; you are in touch with them: you are publishing a
paper; and we want something concrete at least I do whereby I
can get hold of my friends here in the East to get them to support
this kind of legislation, that we all know is beneficial and ought to be
adopted.
Mi\ LYOX. In other words, you want help ?
Mr. RAKER. Help is what we want. We want votes, and that will
bring the money.
Mr. JOXKS. We have endeavored with our own publication to
arouse that same interest that you refer to in the Eastern States. I
will say that, editorially speaking, our policy is always to urge the
posts of the American Legion and other organizations to read these
bills and to debate them on the floor I refer to all bills of interest
to ex-soldiers rather than to take our word for it. I don't think
our paper has said that this bill beats any other bill, but we have-
said that we will supply copies of this bill and data on this bill to
any post, any organization that will consider it. We want them to
debate it and pass resolutions about it and tell their Members of Con-
gress about it, their own opinion of it, and understand it.
There has been this year one State convention of the American
Legion held. That was' the Florida State convention. I went down
there to that convention to speak to them, and the day I got there
they were passing resolutions about this very bill. The resolutions
that they were passing had the thought in mind that it was a bill for
the development of arid and semiarid lands in Western States, and
they have some swamp lands down there, and they wanted them
included in the measure.
The CHAIRMAN. Where was that '.
Mr. JOXKS. The Florida State convention of the American Legion.
That happened to be the first State convention held this year. There
is one to be held in every State.
The CHAIRMAN". What date was that '.
Mr. JOXES. The 17th of May.
Mr. LYOX. Have you read the Bankhead bill (
Mr. JOXES. I have read it; I could not say carefully. biruuse I
only got it two or three days ago from Mr. Bankhead. with his ex-
tension of remarks on it.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 103
Mr. LYOX. It is practically the same as the Smith-McNary bill,
except that it includes reclamation by drainage.
Mr. JONES. Yes; it includes the feature of the Smith-McNary bill,
with the possibility of reclamation by drainage of swamp lands or
the reclamation of stump lands, and with an additional loan feature
in there similar to what was in Senator Borah's bill previously intro-
duced.
Now we have had some considerable reaction in the Northern
States and in the eastern tier of the Northern States from soldier
organizations. They are beginning to grasp the fact that a land
bill is of interest to them.
The CHAIRMAN. That is, a land bill in preference to a cash bonus?
Mr. JONES. I have never myself, and our paper has never con-
sidered this bill as in lieu of tlie present bonus bill; in other words,
we have considered this as a land bill with a soldier preference, not
as a substitute for the Fordnev bill.
The CHAIRMAN. I am not speaking with reference to this bill
particularly, but with reference to the sentiment. You say there
has been a reaction that has taken place; now that reaction, is that
in favor or against what ? You say some change in sentiment has
taken place; what is the change in sentiment ?
Mr. JONES. It is not against the sentiment for cash bonus, I don't
think; I don't believe it has been considered in that light.
The CHAIRMAN. Well, do you mean that they are more strongly
in favor of providing for homes ?
Mr. JONES. There is a greater interest in a land provision of this
character. This land bill, for example, if you enacted this bill and
then enacted the cash bonus bill, a man might use his bonus to take
advantage of the provisions of this bill. I see nothing in this b 11
that could be considered a bonus bill.
Mr. JONES. As it stands, 2913 does not provide either a bonus or a
loan. It is a land settlement bill with a very liberal preference to
soldiers, a preference so liberal that if you enact the bill, for the first
10 years anyhow every acre of surplus land will go to soldiers, I
don't think there is a doubt about that from the experience we have
had of the soldier demand for land. I think every acre of land for
10 years, and probably for the life of the bill, or for 20 years, would
be claimed by ex-soldiers under that six months' preference.
In the Eastern States I have also found a considerable interest
arising in the employment preference, which is also contained in that
that bill, 2913. That is not stated in very specific terms, but I believe
it is mandatory that the Secretary of the Interior shall give the prefer-
ence of employment on reclamation projects to ex-soldiers. Now I
believe and that seems to be the sentiments of the soldier organiza-
tions that have considered the bill that to the easterner, the factory
worker, and he is the fellow who right now is unemployed to an ex-
tent, considering the unemployment problem, the unemployed in
the cities of the East would immediately take advantage of that em-
ployment feature. If they could go west with the assurance of a job,
and if that bill were enacted you would find your American Legion
Eosts a*nd your veterans of foreign wars posts to some extent would
ecome employment agencies for men to go out and work on reclama-
tion projects under that preference that is given them there; that the
city man would, by the nature of that employment have an oppor-
104 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
tunity to become familiar with the climatic and crop conditions and
the other conditions in Western States where land was being made
available, and also to earn money for a period of possibly a year or
more, and saving it towards land payments or for buildings"on the
buildings on the land or whatever he might need. In that combi-
nation of the employment preference with the settlement preference,
the city man who wants to get a toehold in the soil would have a very
excellent opportunity.
Mr. HAYDEX. It has been urged that now is not the proper time
to undertake a policy of reclamation, because of the heavy burden
of expenditures under which the Government labors as a "result of
the war: that we should practice retrenchment rather than expan-
sion of governmental activities. I would like to get your viewpoint
on that question. Do you believe that the construction of recla-
mation projects should be undertaken so as to provide employment
for ex-service men ?
Mr. JOXES. The United States Department of Labor can not tell
us from their statistics what portion of the unemployed, as they
have been listed, are ex-service men. I know pretty well from our
own business records, especially our subscription" sales and our
news-stand sales, which are falling off in industrial centers, what the
situation is. For example, a year and a half ago our biggest sales in
proportion to population of any city in the United States were in
Akron, Ohio. Akron, Ohio, is a rubber-tire town. That business
is all shot to pieces. I think our best large city was Detroit. Mich.,
and our sales, both news-stand sales and subscriptions, are all to ex-
service men, 98 per cent of them. A few other people buy the paper,
but practically they are entirely ex-service men. In Detroit our
business is falling down very materially. In the agricultural com-
munities the drop has been much less, and in some cases a gain; in
fact, it happens that in some places business is increasing in spite of
the slack times, but there has been a material decrease in the in-
dustrial centers, so that we know that the unemployment in those
centers certainly affects the ex-service men in great numbers.
Mr. WILLIAMSON. What about this six-months period here (re-
ferring to H. R. 2913) to give the ex-service men a preference { Do
you think that long a time is r.
Mr. JOXES. That is the six-months preference to soli:
Mr. WILLIAMSON". Yes. Wouldn't a shorter period of time accom-
plish the purpose \
Mr. JOXES. I think at the present time the 60-day preference is
accomplishing it. That is because other functions' such as the
newspaper I represent, accelerate the Government's advertising
methods. The Government does not do much to advertise land
openings. Under the ordinary routine the land office publishes a
notice in certain papers for a certain number of days, but it so hap-
pens that there are special publications like ours with soldier interests
involved that do the advertising.
Mr. HERRICK. There is a little thought that I might give you here
that might be of use to you. and that is this: When you are going
to reach the soldier through the ordinary country weekly newspaper
you must figure that they have a great tendency to publish a piece
of vital news just about a week or 10 days after the usefulness of the
publication has ceased to exist.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 105
I will cite a little case in point: On the 4th day of May, and while
we had this Army appropriation bill under consideration, I noticed a
clause in it that on June 1 the statute of limitations would lapse on
some of these accouterments to which the soldier was entitled at the
time of his discharge, or up to June 1, such as uniforms, etc., and I
took the trouble to get out a mimeographed letter and inclosed a
blank I got out a blank showing them what they were entitled to
and I got a form of application and got out this mimeographed letter
containing this information, you know, and I sent it to every Legion
post in the State of Oklahoma, not merely in my own district but
to every Legion post in the State of Oklahoma. This morning I
opened some country newspapers that come to my office and I
noticed that letter published under date of June 2 and 8, and now
you see the time has expired. I never noticed the publication of
that letter in any of the papers until this morning.
Mr. SMITH. Isn't it probable that you were about a week late in
sending out that notice ?
Mr. HERRICK. No; it was mailed out on May 4, and the time did
not expire until June 1.
Mr. SMITH. Your newspapers are evidently a little slow down there.
Mr. JOXES. Well, I would say that if you had to depend entirely
on Government channels to inform the ex-soldier of his rights and
of his preference rights on each particular project that six months
would be a very safe time. I think that so long as you can rely on
private channels, such as the veterans' organizations and veterans'
newspapers, under the 60-day preference they would get all the lands.
Mr. RAKER. Isn't it the real crux of the thing to get him something
or to give him an opportunity to get something first ? Because it has
been developed so far that where there has been an opening there
have been about 100, if not more, applications to each piece of land
for disposition.
Mr. JOXES. There have been and there will continue and there are
soldiers right to-day taking up homestead lands in the so-called dry
farming areas, which are some of them awfully dry, taking up land
that is pretty nearly hopeless, and you gentlemen from some of the
Western States, Idaho and Montana, know that some of those
alleged dry farming areas that men have gone in there and have
been burned out, and a good many of them have treked out of
eastern Montana back into Dakota as though they were going to
paradise, and Dakota was not considered a paradise when I lived in
Minnesota. But I know there are men going right in and taking up
land in areas where farming has been a flat failure, simply because
they have got that ambition to get hold of some land and believe
that somehow they will make good on it whether nature smiles on
them or not. Some of them are going into places where they don't
get a crop of wheat once in seven years.
Mr. RAKER. We ought to be fair and frank enough to know and
to say that in all these States where there is Government land and
where there is private land, unless you have got water on it you are
throwing your money away to try to do anything with it. There is
no need of disguising that fact.
Mr. JOXES. I think that the land office and the Reclamation
Service are performing a genuine service so far as we have checked
106 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
up on it, in telling soldiers that just because it is Government land
and open to entry does not mean that it is any good. I know they
have gone as far as they could in that.
Mr. KAKER. The land is as good as any land that ever laid out of
doors, climatic conditions and other conditions are right, but you
can't do anything unless you have got water on it. Xow it is so
arranged that all the small streams nearby are taken up and you
have got to go to large expense in building reservoirs and canals
to get water on there, and that is what we want to do with this kind
of legislation.
Mr. JOXES. This gentleman here asked me a moment ago about
the expense involved to the Government at the present time in
undertaking a project or a series of projects that this bill provides.
I think the best answer to that consists in Congressman Bankhead's
remarks on his bill, in which he said that the entire cost of it would
be about the cost of one first-class fighting ship, and he estimated
for that expense 100,000 citizens would be placed on farms. I think
that is a conservative estimate.
Mr. LITTLE. You would rather see them spend the money to give
people a chance to farm than to spend it on fighting ships I
Mr. JONES. I think that it would be highly practical to lessen our
armament program to the extent of one fighting ship if you could
put 100,000 people on farms, on new land that is not now cultivated.
Mr. LITTLE. What is the use of omitting just one ship? How
about knocking off five or ten of them and putting the money into
soldier farms ?
Mr. JONES. I don't think that I had better go into the affairs of
the Foregin Relations Committee that far.
Mr. HAYDEX. The thought I had in mind was that if there is
serious unemployment in the country which extends to the ex-service
man, and if we are further aware that the enactment of any legis-
lation giving them a preference means that practically every farm
unit opened to entry will be settled upon by a soldier, it would seem
to me that under such circumstances Congress is especially justified
in beginning a general reclamation program now. The need of
employment for ex-service men is an argument in favor of prompt
action on some measure of this kind rather than for delay.
Mr. JONES. That is absolutely my opinion. I think you will find it
the opinion of everybody in the ex-service men's organizations.
Mr. HAYDEX. You mentioned some action taken by the Legion in
the State of Florida. Do you anticipate that if this bill was reported
out, which merely applies to the Western States where irrigation is
practiced, that similar action will be taken in other States of the
South or of the East, urging that they have swamp lands or cut-over
lands which might be reclaimed, that the legislation should be
broadened to care for the development of such lands?
Mr. JONES. I think you will find that will happen. L'nfortunately
it has been the history of lots of different kinds of legislation for a
good many years that there is a tendency for different localities in the
country to take a very strong interest in their local or, you might say,
their selfish interests in the matter. So far as the ex-soldiers are
concerned, our point of view is that we want to see western lands
developed; we want to see southern lands developed; we want to see
DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES. 107
any land developed that a soldier can settle on, if it can be developed
at such a low cost and create such an increment that the soldier gets
a real chance. Xow we believe I believe very firmly that 2913 as it
affects western lands is a practical bill, that it will make land available
at a price that the settler can pay for it, and gives a preference whereby
the soldier will be the settler. That doesn't mean that we have any
prejudice against any southern amendment or the amendment of
anybody else covering any other kind of land.
Mr. LYOX. Your paper is published here in Washington, is it not ?
Mr. JOXES. Yes.
Mr. LYOX. I would be mighty glad in the case of one or two gentle-
men that we are going to try to get before this committee on that
question, if you would come in and hear those gentlemen on the ques-
tion of reclamation of swamp lands and cut-over lands, the cost of it,
and how soon it will pay for itself.
Mr. JOXES. I am very much interested in it. In fact, I have talked
to Congressman Bankhead about this bill and have made some inves-
tigation on the subject, but not to the extent that I have on this
other measure.
The CHAIRMAX. Mr. Jones, now if you will continue in your own
way, if you have any other observations, if you have any other ideas
to present on the bill.
Mr. JOXES. We furnished the Senate Committee on Irrigation some
data, which I have no copy of, but which is presented in their hearings
on this same bill, some data from the Canadian board of soldire
settlement, which I believe your committee will find very interesting
and very informative. It is not an annual report but a semiannual
report of November 30 last on the soldier settlement work in Canada,
where they undertook to settle soldiers on the land, in fact, before the
armistice. They had wounded soldiers returning, of course, even at
the end of the war, and I believe enacted their law about that time.
That is on page 31, second session of the Senate hearings on this
same bill, and the particular point in it that I want to emphasize is
the very small number of changes which have been experienced of
the soldier farmers in Canada. I will say that they took men from
the cities and from the country, and anybody that applied, although
if a man applied who knew nothing about farming that is a loan
measure, ndt a reclamation measure it is a farm-buying loan measure,
but the}* would take any man that applied, except if a man had abso-
lutely no experience in farming, their soldier settlement board was
authorized to place him in training under a farmer. That meant
practically making him an apprentice for a period of three months.
Mr. LITTLE. Did they try that out ?
Mr. JOXES. The training?
Mr. LITTLE. Yes.
Mr. JOXES. A very small number took the training. The reason
for the small number taking the training, I think, was that they only
paid them 810 a month during the period of training, and up until
last July there were plenty of jobs at good wages in the cities, the
same as there were here, and men were not willing to go into training
for S10 a month for any purpose.
The CHAIRMAX. Did they make any report on the training as to
the effect, the benefit of the training '(
108 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. JONES. There is a report on the number of men in training.
but I don't think it is contained in this tabulation.
Mr. WILLIAMSON. What is that Senate report you have ?
Mr. JONES. This is part 2 of the Senate hearings before the Com-
mittee on Irrigation and Reclamation on Senate 536. That is the
same as H. R. 2913.
The CHAIRMAN. Just state what that part is, and we will have it
put into the record.
Mr. JONES. That is just a table on page 31 of those hearings. I
can leave you this copy.
(The paper referred to follows :)
WAR TO PEACE TABLOID STATEMENT OP SOLDIER SETTLEMENT BOARD OPERATIONS.
Summary of operations, Xcr.
Number of veterans in communication with board 100. 000
Number applied for privileges of act
Xumber accepted as qualified to farm 41. 906
Number qualified but not yet located 21 . 975
Number in training under supervision of board 916
Number completed training 1, 444
LOANS.
Number granted loans 19. 931
Amount of loans approved ';- '. 302. 649
Number of
loans. Amount.
P. E. I . .. .
N. S .....3 l.J'7.448
X. B 511 1.463,602
Que
Ont 1.405 6,07
Man ; T.',. 304. 07fi
Sask 4.893 19.947.706
Alta 5.727 2.906,504
B. C 2.944 12.596,649
19. 931 80. 302. 649
Amount of loans disbursed *70. 2S1.872
Initial payments on land purchasc-d
Number liable for repayments Nov. 1 12. 507
Number who made repayments * 7. 470
Amount due '. S2, 334. 174
Ajmount repaid
Number who have repaid loans in full 201
ADJUSTMENTS.
Number of failures and changes of ownership adjusted 166
Amount invested in these farms >t)20, 869
Amount realized in resale of farm and equipment (showing average loss of
$38 per farm I '-514, 548
'Or 59.7 percent.
* Or 53.7 percent.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 109
AREA OF SOLDIER LANDS.
Area of new land broken ("West only), acres 202, 730
Area of land taken up by soldier settlers, acres 3, 371, 000
Savins; in purchase of land ( estimated) $2, 700, 000
(This is based on exact figures from several districts.)
STOCK AND EQUIPMENT.
S. & E. purchased for soldier settlers $22,619,759
Saving to settlers through special arrangements with dealers $742, 568
Mr. SIXXOTT. Are the soldiers assisted financially, otherwise than
getting the lands in Canada, as to farming implements, stock, and
buildings ?
Mr. JOXES. They were given loans either for lands, live stock, or
purchase of implements. There has been a total of 58,811 applicants
for loans in Canada.
Mr. LITTLE. Government loans ?
Mr. JOXES. Government loans, yes.
Mr. LITTLE. It is something like Ireland ?
Mr. JONES. I don't know about that.
Mr. WILLIAMSOX. Those loans have not been out long enough vet
to know whether or not they will be taken care of by the ex-service
men, have they ?
Mr. JOXES. Some of them have been out a period of two years.
Mr. RAKER. Mr. Jones, what you are referring to now is to your
own testimony before the Senate committee ?
Mr. JOXES. Yes. The particular point I wanted to make was that
out of 41,000 loans that have been made 41,906 their board had
had 166 failures. The Canadian law gives their board very wide
authority in supervising the settler after he goes on the land. If he
has one of these Government loans, they can watch him and check
up on his work, and, in fact, have almost arbitrary authority to call
in his loan if he shows no energy or purpose and no likelihood to
succeed as a farmer. But out of this very small number of failures,
where they have called in loans and put a man off the land and taken
over his land, they took those farms and resold them, and they
suffered a net loss of only $38 per farm. In other words, the Cana-
dian Government's loss on loans, where they did make a loss, in 166
out of 41.000 cases, was only $38 per farm. In other words, thev
lost only about 84,000 in all. "
Mr. RAKER. Have you that Canadian law that authorizes this
system of placing the ex-service men on these farms and providing
their loans ?
Mr. JOXES. I haven't a copy of the act, but I can get a copy.
Mr. RAKER. Will you get it and insert it in your hearing?
Mr. JOXES. Yes. I am in constant correspondence with that land-
settlement board; in fact, I hope to get their annual report. If I do,
I will be glad to send the committee a copy of it.
Mr. RAKER. And you will insert that?
Mr. JOXES. Yes; certainly.
110 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
(The paper referred to follows:)
EXHIBIT A.
9-10 GEORGE V.
CHAP. 71.
An Act to assist Returned Soldiers in settling upon the Land.
[Assented to 7th July. 1919.]
HIS Majesty, by and -with the advice and consent of the Senate and House of Com-
mons of Canada, enacts as follows:
PART I.
THE SOLDIER SETTLEMENT BOARD ACQUIREMENT OF LAXDS.
SHORT TITLE.
1. This Act may be cited as The Soldier Settlement Act, 1919.
INTERPRETATION'.
2. In this Act, and in any regulations made under it, unless the context otherwise-
requires, the expression,
(a) "Agricultural land" means land which, in the opinion of the Board, is adaptable
for agricultural purposes and the value whereof for any other purpose is not greater
than its value for agricultural purposes;
(6) "Block" means a parcel or parcels of land owned within a settlement area by
any person, and whether or not the parcels are contiguous the one to the other,
but including only the parcels any part of any one whereof is situated within-
three miles from any part of another of them;
(<) "Board" means the Soldier Settlement Board of Canada;
. (d) "Court" means the Exchequer Court of Canada:
(e) "District Superintendent" means a person appointed as such by the Board;
(/) "Dominion Lands" means any lands owned or held by the Dominion of Canada,
excepting Indian or School Lands;
(g) "Former Act" means The Soldier Settlement Act, 1917;
(h} "Gazetted" means published in the Canada Gazette;
(?) "Land" or "Lands" includes granted or ungranted. Dominion. Provincial or
private lands, and real or immovable property, messuages, lands, tenements and
hereditaments of any tenure, and real rights, easements and servitudes, streams,.
watercourses, waters, roads and ways, and all rights or interests in, or over, or
arising out of. and all charges upon. "land or lands as herein denned:
(j) "Military" and "Military forces" include "Naval" and "Naval forces;"
) "Minister" means the Minister of the Interior;
"Property" includes land, as herein defined, and goods, chattels real and per-
sonal, and personal or movable property, and all rights or interests in. or over,
or arising out of, and all charges upon, property a? herein defined:
(TO) "Owner" includes a person holding private land in fee simple, and a person
who, being trustee, executor, administrator, life tenant, mortgagee or otherwise,
has the legal power to will or convey i whether with or without the consent or
approval of a court or of any person having any estate or interest) such land to be
held in fee simple or by a person as the owner tl"
(n) "Permanent Improvements" and "Improvements" includes buildings;
(o) "Private land" means any land which has been alienated by the <'rown:
(/>) "Registrar of deeds" or "Registrar" includes the registrar of land titles, or
other officer, with whom, according to the law of a province, title to land is regis-
tered;
(q) "Registry of deeds" or other words descriptive of the office of a registrar of
deeds, inc.udes the land titles office, or other office in which, according to the-
law of a province, title to land is registered;
(j
(k
(/)
DEVELOPMENT. OF AGRICULTURE IX THE UNITED STATES. Ill
(n "Settlement area'' means an area of land in any part of Canada, so designated,
and denned as this Act requires by the Board, within which the Board exercises
or proposes to exercise, its power of compulsorily purchasing lands;
(s) "Settler" means a person who at any time during the war has been therein
engaged on active service in a military force.
(1) of Canada and has served out of Canada; or. wherever he may have
served, is. by reason of disability incurred or aggravated as the result of such
service, in receipt of a pension; or,
(2) of His Majesty or of any of His Majesty's Allies and, being ordinarily
resident in Canada when he enlisted in or otherwise became a member of
such force, has served thereafter out of Canada, in a theatre of actual war; or,
(3) of His Majesty or of any British Dominion or Colony and has served out
of the country "wherein he enlisted or otherwise became a member of such
force in a theatre of actual war;
and has been otherwise than dishonourably discharged from such force, or has
been permitted to honourably resign or retire therefrom, or, without fault on his
part, has been dispensed from further service therein; and the widow of any
person who died on active service and who. but for his death, might be a settleV
as now denned, shall be capable of being a settler in her deceased husband's
right: Provided that, notwithstanding anything in this Act, settlers of the class
numbered (3) in this definition may be required by the Board to provide a larger
cash down payment in case of purchase of property from the Board or to provide
great?r or other security in case of an advance or loan received from the Board,
than is by this Act authorized or required with respect to settlers generally;
(t) "Special Settler'' means a settler as defined in this section, who, in the opinion
of the Board, has had adequate and successful farming experience in Canada,
and who is possessed of qualifications or equipment which, in the opinion of the
Board, specially fit him for success as a farmer;
(u) " Soldier grant " means a free entry on Dominion Lands, granted by the Minister
to a settler recommended by the Board;
(r) "This Act'' and "Act" and "Former Act" includes regulations lawfully made
thereunder;
(w) "The \\ar " means the war declared by His Majesty on the fourth day of August,
1914, against the Empire of Germany and, subsequently, against other powers.
CONSTITUTION OF THE BOARD.
3. (1) The Soldier Settlement Board, as constituted pursuant to the former Act,
shall continue to consist of three commissioners, each to hold office during good be-
haviour, but to be removable by the Governor in Council at any time for cause and
to become ineligible upon attaining seventy years of age. The Governor in Council
shall appoint one of such commissioners to be" Chairman of the Board.
There shall be paid, monthly, to the chairman of the Board and to each of the
other commissioners, such salaries, and at such rate per annum, as the Governor in
Council shall fix and allow.
CORPORATE POWERS OF THE BOARD.
4. (1) For the purposes of acquiring, holding, conveying, and transferring, and of
agreeing to convey, acquire or transfer any of the property which it is by this Act
authorized to acquire, hold, convey, transfer, agree' to convey or agree to transfer,
but for such purposes only, the Board shall be and be deemed a body corporate,
and as such the agent of the Crown in the right of the Dominion of Canada. Anv
and all property acquired by the Board shall, upon acquirement, vest in the Board
as such body corporate; but these provisions shall not in any wise restrict, impair
or affect the powers conferred upon the Board, generally, by this Act. nor subject
it to the provisions of any enactment of the Dominion or of any province respecting
corporations, nor require of it, in the keeping of its records, any segregation of its
corporate from its non-corporate acts.
(2) The Board, in its corporate capacity, shall have an impress seal inscribed
with the words "The Soldier Settlement Board of Canada ' and shewing the coat of
arms of Canada.
(3) All documents which require execution by the Board in its corporate capacity-
shall be deemed validly executed if the seal of the Board is affixed, and the name
of one of the commissi sners is signed, by such commisvimer thereto, the whole in
the presence of one other person who has subscribed his name a ; witness: and every
document which purports to be impressed with the seal of the Board and to be sealed
112 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
and signed in the presence of a witness by a commissioner on behalf of the Board
shall be admiissble in evidence in all courts in Canada without proof of such seal
or of such sealing or signing.
EMPLOYEES.
5. The Board may, from time to time, subject to the provisions of The Civil Service
Act, 1918, attach to its service such officers, instructors, clerks, stenographers and
other employees as the execution of the purposes of this Act may require, and at
such salaries' as the Governor in Council may approve. All such appointees shall
hold office during the pleasure of the Board and shall perform such duties and func-
tions as the Board shall prescribe.
RESERVATION AND ACQUIREMENT OF LANDS AND OTHER PROPERTY.
6. (]) The Minister may, at the request of the Board, for the execution of any of
the purposes of this Act, reserve, or, with the approval of the Governor in Council,
transfer, to the Board, any Dominion lands which are under the Minister's adminis-
tration.
(2) Any reservation of lands made pursuant to this section shall lapse and become
determined whenever the Minister shall, before transfer made to the Board, so direct.
7. The Board may, for the execution of any of the purposes of this Act
(o) purchase by agreement, at prices which to it shall seem reasonable; or,
(6) in any other manner acnuire by consent or agreement, from all persons, firms and
corporations, such agricultural land, situate in any part o 1 ' Canada, and such live
stock, farm equipment and building materials as it may deem necessary.
8. The Board may, for the execution of any of the purposes of this Art, acquire
by way of compulsory purchase, in the manner provided by Part III of this Act,
from all persons, firms, and corporations, such agricultural land as it may deem
necessary.
9. (1) "The Board may, with the approval of the Governor in Council, arrange Avith
the Government of any province.
(a) for the acquiring or utili ing for any of the purposes of this Act of any Crown
or other agricultural lands of such province; and.
(fc) the terms and conditions upon which the Board will acquire, hold and dispose
of or Anil utilize such lands, or upon which it will assist settlers to whom such
province itself shall grant or convey any of such lands, such terms and conditions
to be, as nearly as possible, the same as those which are by or under this ^ct
pro ,ided with respect to settlers to whom the Board shall sell lands acquired by it.
10. The Board may acquire from His Majesty by purchase, upon terms not incon-
sistent v>ith those of the release or surrender, any Indian lands which, under the
Indian Act, have been validly released or surrendered.
11. (1 ) Notwithstanding anything in The Dominion Lands A't having reference to
school lands, the Governor in Council may, for such price as two arbitrators, one
thereof appointed by the Minister and the other by the Governor of the Province
concerned, shall in writing certify to the Minister as fair and reasonable, grant or
convey to the Board any school lands held pursuant to the provisions of that Act.
(2) The amount payable by the Board for the acquirement of such lands shall be
applied as if received as the proceeds of a sale of the same lands made pursuant to the
provisions of The Dominion Lands Ad.
12. The valuation of any land purchased or proposed to be purchased by the Board,
whether by agreement or compulsorily, shall not be enhanced merely because its
value has, by reason or in consequence of settlement or settlement operations in the
vicinity thereof in execution of any of the purposes of this Act, become enhanced ;
and, in the absence of satisfactory proof to a contrary effect, any enhancement in
the value of "^he land which has ensued subsequent to such settlement or settlement
operations shall be deemed to have ensued by reason or in consequence of such set-
tlement or settlement operations, and the value of the land at the time of its pur-
chase by the>4Joard shall be deemed not greater than its value prior to such settle-
ment or settlement operations.
13. (1) Any tenant in tail or for life, grere de substitution, seigneur, guardian, tutor,
curator, committee, executor, administrator, trustee, master or person, not only for
and on behalf of himself, his heirs, successors, and assigns, but also for and on behalf
of those whom he represents, whether infants, issue unborn, lunatics, idiots, married
women, or other persons. M>i/.<d. p>i ^i-ssi'd, or interested in any land or other property,
may contract and agree with th" Board for the sale of the whole or any part thereof,
and may convey the same to the Board; and may also con ti act and agree with the
Board as to the amount of compensation to be paid for any such land or propeit)'
and give acquittance therefor.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 113
(2) In any case in which there is no guardian or other person to represent any per-
son under any disability, the Court may, on the application of the Board after due
notice to the persons interested, appoint a guardian or person to represent for the
purposes hereof such person so under such disability, with authority to give such
acquittance.
(3) The Court in making any order in this section mentioned shall give such direc-
tions as to the disposal, application or investment of such compensation money as
it deems necessary to secure the interest of all persons interested therein.
(4) Any contract or agreement made hereunder, or any conveyance or other instru-
ment made or given in pursuance of such contract or agreement shall te good and
valid to all intents and purposes whatsoever.
(5) Every such contract or agreement shall be binding on the owner and on all who
may take or claim through or under him, for six months from the date of the contract
or agreement, although such land has in the meantime devolved upon or been con-
veyed or assigned to a third person.
(6) No surrender, conveyance, mortgage, charge, agreement or award under this
Act shall require registration or enrolment to preserve the right of the Board under it,
but the same may be registered in the Registry of Deeds for the place where the land
lies, if the Board deems it advisable.
(7) This section shall apply to all parts of this Act.
AGRICULTURAL TRAINING.
14. The Board may, with the approval of the Governor in Council, make provision
for,
(a) the placing of settlers with farmers for instruction in farming;
(b) the establishment of agricultural training stations for settlers;
(c) the supply of instructors and inspectors to visit and assist settlers with informa-
tion and instruction in farming;
(d) the training in home economics of the wives and female dependents of settlers ;
and,
{e) the payment of subsistence allowances to settlers, for themselves and their
dependeats, while such settlers are in receipt of such instruction or training.
SOLDIER GRANTS.
15. (1) The Minister may issue, free, to any settler a soldier grant for not more than
one quarter section (of one hundred and sixty acres, more or less) of lands reserved
pursuant to section six of this Act.
(2) Unless the Board shall, for special reasons, otherwise recommend, no such free
grant shall be made to any settler who,
(a) has, pursuant to the provisions of this Act, purchased from the Board any
land; or,
(b) has, pursuant to the provisions of this or of the former Act, secured from the
Board any advance of money for the clearing of encumbrances on, or the pur-
chase of, or the improvement of, any land ; or,
(c) is owner of or has a vested, possessory interest in, agricultural land of such area
as, in the opinion of the Board, constitutes an average farm for the district within
which the land is situate, or which, in the opinion of the Board, is of the value
of five thousand dollars.
(3) The Governor in Council may provide, as respects such free grants, such con-
ditions of improvement and occupation as he deems necessary to secure the use of the
land for the purposes for which it is granted.
PART II.
SALES AND ADVANCES TO SETTLERS.
SALES OF LAND.
16. The Board may sell, or dispose of, and, upon full payment made, may convey,
to settlers, any lands granted, conveyed or transferred to or acquired by it, or which
it may have power to sell or dispose of, but subject in every case of sale of lands ac-
quired by purchase, whether by agreement or compulsorily, to the following pro-
visions:
(a) Where the parcel to be sold has been separately acquired the sale price shall be
the cost of the parcel to the Board;
5666421 8
114 DEVELOPMENT OF AGRICULTURE IK THE UXITED STATES.
(6) Where the parcel to be sold has been acquired as portion of one or more other
parcels the sale price shall be such amount as in the opinion of the Board, bears
the same proportion of the cost of the entire parcel or parcels so acquired as the
value of the parcel to be sold bears to the value of the parcel or parcels so acquired;
(c) The terms of payment shall be all cash down, or. at the option of the settler,
not less than ten per centum cash down and the balance payable in twenty-five
or less equal, consecutive, annual instalments, with interest at live per centum
per annum, on the amortization plan, with full privilege of prepayment. Pro-
vided that the Board may, in the case of a special settler, dispense the settler
from the making of the whole or any part of the cash down payment, in which
case the full or the remaining portion of the sale price shall be paid, in manner
hereinbefore provided with respect to a balance of such price, by instalments;
Xo sale shall be made of a larger area than three hundred and twenty acres,
unless, in the opinion of the Board, owing to the character of the land, such
acreage will not be adequate to enable successful farming operations, nor, except
in the case of a settler who is within the terms of the proviso in the next preceding
paragraph of this section, shall the balance of sale price left unpaid to the Board
at the time of sale exceed four thousand five hundred dollars, nor in the excepted
-hall the balance or amount left unpaid exceed five thousand dollars.
17. (1) The Board shall 6alculate in each case of sale the price at which any land
may be sold under the provisions of this Act.
(2) In calculating the cost to the Board of any land acquired by purchase, the
Board shall take into consideration not only the cost of the land but also the cost of
improvements, if any, effected by the Board.
SALES OP STOCK AND EQUIPMENT.
IK. (1) The Board may sell to settlers any live stock or equipment acquired under
authority of this Act. but subject in every "case of sale to the following provisions:
(a) The sale price shall be such sum as,' according to the calculations of the Board,
i- I he cost to it of the live stock or equipment to be sold:
(b) The terms of payment shall be all cash down, or, at the option of the settler,
payment in four equal, consecutive, annual instalments, commencing not later
than three years from the date of the sale, with interest at five per centum per
annum, on the amortization plan, said interest to begin to accrue two years from
tbe date of the sale; the amount owing to the Board upon such sale shall by force
of this Act constitute a first charge on any land purchased by the settler from
the Board and. as well, on the settler's own land, if any. and. cumulatively, the
title, ownership and right of possession of the live stock, and of the increase
thereof, and of the equipment so sold, shall, until the sale price thereof is paid,
remain in the Board; the settler to have full privilege of prepayment:
(c) The balance of sale price left unpaid to the Board at the time of sale shall not
exceed two thousand dollars.
(2) In addition to any assistance which a settler, as defined in the former Act,
holding any entry on Dominion land?, may have secured or may secure by virtue
of the provisions of that Act, the Board may sell to such settler live stock and equip-
ment on the terms of payment set out in this section, save that the balance of sale
price left unpaid to the Board shall not exceed one thousand dollars, all other pro-
visions of this Act relating to sales of live stock and equipment made to settlers being
deemed to refer and apply mutatis mn/fnf/!^ to any such sale of live stock and equip-
ment, whether such sale is or was made under authority of this subsection or by virtue
of the provisions of any Order of the Governor in Council before the passing of this
Act. but so that the total made by () the advances of the Board to the settler in any
connection under authority of this Act and, (b) the amounts, exclusive of interest,
due by him to the Board as the result of any sale made under authority of this sub-
section, shall not exceed three thousand dollars.
ADVANCES FOR IMPROVEMENTS.
19. (1) The Board may from time to time advance to any settler to provide, or for
application to, permanent improvements on the land of the settler or on the land sold
to him by the Board, amounts in money or its equivalent not exceeding in the aggre-
gate one thousand dollar-, inclusive of the cast price to the Board of building or other
materials supplied by it.
(2) Such advances shall by force of this Act constitute a first charge on the land
of the settler or on the land sold to him by the. Board and shall be repayable in twenty-
five or less equal, consecutive, annual instalments, with interest at five per centum
per annum, on the amortization plan, with full privilege of repayment.
(3) Every such advance shall be expended under the supervision of the Board. t
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 115
TERMS OF DISPOSITION OF PROPERTY.
20. Subject to the provisions of section fifteen of this Act as to soldier grants of
Dominion lands, the Board shall deal with and dispose of all Dominion lands, Indian
lands or school lands granted or otherwise conveyed or transferred to it pursuant to
sections six, ten and eleven of this A ct as nearly as may be as if such lands were pri vate
lands acquired by it by way of purchase, but the sale price of such lands shall be such
as i< approved by the Governor in Council.
21. (1) No land which ha been acquired or reacquired by the Board, whether by
purchase, or by retaking because of default or otherwise, shall be sold or resold by the
board at a price less than the cost to it thereof, calculated as in section seventeen of
this Act provided, unless with the approval of the Governor in Council.
(2) If tke Board determines that the whole or any part of any land or other property
purchased by it cannot or ought not to be sold subject, whether as to sale price or
otherwise, to the provisions of sections sixteen to eighteen inclusive of this Act. it
shall report to the Minister the circumstances, with a statement of the cost to it of
such property or of such part thereof and shall recommend another sale price, or other
terms of sale, as the case may be, \vhereafter any sale of such property or of such part
thereof shall be made for such sale price, or upon such other terms, as the Governor
in ( 'ouncil may direct.
RESALE UPON DEFAULT.
22. (1) All sales of property made pursuant to the provisions of this Act and whereon
any balance of the sale price shall remain payable by instalments or otherwise, shall
be evidenced by agreement of sale, which shall fully set forth the terms of sale.
(2) If any instalment mentioned in any such agreement of sale is not punctually
made or if the settler makes any other default in performance of the terms of such
agreement, the Board may without any formal re-entry or retaking and without
resort to proceedings in equity or at law, rescind such agreement and resell or other-
wise deal with the property as authorized by this Act.
(o ) The effect of such rescission shall be to vest such property in the Board abso-
lutely free and discharged of all rights and claims of the settler, and of all persons
claiming or entitled to claim through or under him, for any estate in, or lien, charge
or encumbrance upon or against such property.
(4) If and when such property is resold by the Board, any surplus remains in its
hands beyond the amount owing to it as balance of the sale price and interest at five
per centum per anntim and expenses of taking over and reselling the property, the
Board shall pay such surplus to the settler; but if, instead, a deficiency arises, that
deficiency shall be paid by the settler to the Board, which shall have a right of action
against him therefor.
<o) Before exercising as against land the rights by this section given the Board
shall give to the settler notice of its intention so to do, which notice'shall be deemed
duly given if mailed in any post office by registered letter addressed to the settler
at his last known address known to the Board thirty clear days before the Board
acts here under.
23. In the event of the rescission of any contract or agreement by the Board it
may. subject to the provisions of section twenty-one, in order to recoup itself for
its expenditures in connection with the acquirement of the property with reference
to which such agreement of sale was made, and other advances, if any, made to the
settler under the provisions of this Act or of the former Act or to regain the value of
such property, sell, lease, exchange, or otherwise dispose of such property to a settler
or, with the approval of the Minister, to any other person.
21. Any land purchased or held for disposition by the Board may. pending such
disposition, be leased by the Board to a settler or otherwise upon terms satisfactory
to the Minister.
ADVANCES FOR THE DISCHARGE OF ENCUMBRANCES.
25. (1) The Board may from time to time advance to a settler, to enable the dis-
charge of encumbrances on agricultural land which is owned and used by him as
such, amounts in money not exceeding in the aggregate three thousand five' hundred
dollars and not exceeding fifty per centum of the value of such land, but so that the
total made by (a) the advances of the Board to the settler under this section and, (b)
the amounts, exclusive of interest, due bv him to the Board in any connection under
authority of this Act. shall not exceed five thousand dollars.
116 DEVELOPMENT OF AGRICULTURE 1ST THE UNITED STATES.
(2) Such advances shall, by force of this Act. constitute a first charge on the land
of the settler with respect to which the advance is made, and repayment thereof
ehall be secured by a first mortgage upon such land and shall be made in twenty-
five or less equal, consecutive, annual instalments with interest at five per centum
per annum, on the amortization plan, with full privilege of prepayment. In the case
of advances made to a settler holding unpatented Dominion lands such advances
shall, further, notwithstanding anything in The Dominion Lands Act or any other
matter or circumstance, constitute" a first charge against such lands, and no" patent
shall be issued to the settler therefor until such advances, with accrued interest.
have been fully repaid.
(3) No advance such as by subsection one of this section authorized shall be made
unless the Board is satisfied,
(a 1 ) that the value of the security, ascertained as in section twelve of thi
directed with respect to lands to be acquired by the Board, is sufficient to justify
the making of the advance: and.
(b) that, the applicant has the ability to make from the land a fair living for him-
self and his dependents, if any. after paying interest and amor fixation charges
and other necessary payments" with respect to such advances and to the land
and the cultivation thereof.
(4) Every silch advance shall be expended under the supervision of the Board.
CHARGES OX DOMINION" LANDS.
26. When a settler obtains Dominion lands, whether by soldier grant or otherwise,
and whether before or after hiving secured from the Board any advance pursuant
to this Act. while there is owing to him by the Board any sum or sums of money as
the result of any sale made t6 him by the Board, or otherwise by reason of the exercise
by the Board of any of its powers under this Act. such sum so owing shall con?titute
a first charge on the lands so obtained and no patent shall be issued to such settler there-
for until such sum or sums, with accrued interest, have been fully paid or repaid.
27. Notwithstanding anything in The Dominion Lands Act or in any other Act, in
the event of a settler who is holding any Dominion land on which a charge has been
imposed, constituted or created by or under this or the former Act (hereinafter referred
to as ''charged land") being in default with respect to the terms or conditions of
any agreement of sale, mortgage or other document executed or made with or to the
Board, the Minister, upon request made by the Board, may declare the right, title
and interest of the settler to or in such charged land to be forfeited, whereupon (and
also in the event of the right, title or interest of the settler to or in such charged land
becoming forfeited for default in performance of settlement conditions or for any
other reason apart from the provisions of this section) the Minister may declare the
said right, title or interest of such settler, and also the right, title or interest of His
Majesty to or in such charged land, to be vested in the Board, and it may thereafter,
subject to the provisions of section twenty-one of this Act, in order to recoup itself
for the amount owing by such settler and charged upon such land, sell, lease, ex-
change or otherwise dispose of such land to a settler, or, with the approval of the
Minister, to any other person; but if any surplus is realized beyond the amount
required to recoup the Board as aforesaid, such surplus shall be paid by the Board to
the Department of the Interior for the Consolidated Revenue Fund.
LIMITATIONS UPON SALES AND ADVANCES.
28. Notwithstanding anything in this Act, the Board shall not, unless the Minister
upon the recommendation of the Board shall approve, sell any lands to any settler
who,
(a) has obtained a soldier grant under this or the former Act; or.
(6) has secured from the Board, under this or the former Act, any advance of money
for the clearing of encumbrances on land owned by the settler; or,
(c) is owner of, or has a vested, possessory interest in/agricultural. land of such area
as, in the opinion of the Board, constitutes an average farm for the district within
which the land is situate, or which, in the opinion of the Board, is of the value
of five thousand dollars.
SALES FOR SPECIAL PURPOSES.
29. Notwithstanding anything in this Act, the Board, with the consent of the
Governor in Council, may sell any land which is at its disposal for sale, not exceeding
five acres in extent, in the cases and subject to the conditions following, that is to
say
() As a site for a dairy factory, cheese factory, fruit preserving factory or creamery.
or for any educational, religious, charitable, or public purpose, or" for any other
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
purpose which, in the opinion of the Board, renders such a sale in the public
interest:
if" To any provincial or municipal authority for any purpose;
(<) The price shall in each case be fixed by" the Governor in Council and shall be
not less than the cost of the land as it would be estimated by the Board on a sale
to a settler of lands acquired by purchase under this Act.
GENERAL PROVISION'S.
30. (1) All deeds of land, all mortgages and charges upon land or goods and all
contracts and agreements whatever, including bills of exchange and promissory notes,
made or entered into by any settler to or with, or for the benefit or security of. the
Board, purporting to act with respect thereto or to accept any thereof in execution of
any of its powers under this Act or under the former Act. shall be valid and enforceable
notwithstanding that such settler is not of the full age of twenty-one years, or is an
Indian or is under any civil disability.
(2) This section shall be deemed to have been operative as from the passing of
Tl,e Soldi, r 3eUlem< nt Art. 1917.
31 . Every settler holding or occupying land sold by the Board shall, until the Board
grants or conveys the land to him. be deemed a tenant at will.
32. All agreements of sale or otherwise, all instruments evidencing liens or charges,
and all other documents authorized or required by this Act. shall be made in such
form and according to such forms and shall contain such provisions as by way of
regulation made the Board shall provide and every such document shall have effect
as if the form thereof were statutory, and were provided by and as part of this Act.
33. Notwithstanding any law. whether statute or otherwise, in force any any
province.
(a) which authorizes or requires the registration, recording or filing of deeds, mort-
gages, certificates of judgments, attachments, bills of sale or other documents
which al'fect title to. or evidence the existence of liens or charges upon, property ,
real, personal or other: or.
(6) which authorizes the levy upon, or sale under attachment, execution or othei
process, or the expropriation or seizure of, property, real, personal or other;
unless the Board shall otherwise consent in writing the lands of, or sold by the Board
t<>. a settler, and the live stock and equipment of, or sold by the Board to, a settler,
and the increase of any such live stock, and the Board 's and the settler 's respective
intere-ts in such lands, live stock and equipment, shall, for so long as any part of the
sale price, or the amount of any advance made with respect to any such property, or
any interest, or any amount charged upon such property or any thereof in favour of
the Board, remains unpaid to the Board, be exempt from and not within the opera-
tion <>f such laws.
34. (1) Notwithstanding any law, whether statute or otherwise, in force in any
province.
( a i while any sum shall remain unpaid upon the aggregate advances or payments
made from time to time pursuant to the provisions of this Act by the Board to
or on behalf of a settler, and secured by or charged whether under this Act or
otherwise, upon properties real, personal or other, of the settler, or upon the
settler's interest in any of such properties, all of the properties so charged shall
continue to be security for repayment of such sum or sums as shall at any time
remain unpaid upon any of such advances or payments and, unless with the
consent in writing of the Board, the interest of the settler in any of such proper-
ties shall not be capable of being voluntarily or involuntarily alienated, or sub-
sequently charged or encumbered nor be subject to the operation of any law or
agreement whatever to the prejudice of the claims or charges of the Board;
(6) no deed, mortgage or other instrument executed by or for a settler, and no
judgment recovered or attachment, execution or other process issued -against
him shall, a,s aeainst the Board, bind or affect the lands or the live stock arid
equipment, sold by the Board to auch settler or his land upon the security of
which the Board has made any advance of money, or the increase of any of
such live stock sold as aforesaid, for so long as the sale price of said lands, live
stock or equipment, or said advance, or any part of said price or advance, or any
interest thereon, remains unpaid to the Board:
(c) the wife of any settler shall not. for so long as the sale price, or any part thereof
or any interest "thereon, or any charge in favour of the Board, remains unpaid
upon 'any lands which were sold by the Board to a settler, or upon the security
of which the Board has made any advance of money, have in priority or in prej-
udice of any claim or charge of the Board against or upon such lands any estate of
dower therein nor, during the same period, shall the husband of any settler have in
118 DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES.
priority or prejudice as aforesaid, any estate of curtesy in such lands, nor shall
the Mechanics' Lien laws or other lien laws or the dower or homestead la"s of
any province extend or apply in priority or prejudice as aforesaid to said lands;
(d) no sale. tuft, delivery, barter, exchange, pledge, charge, lien or other transac-
tion by or for the settler to or with any person, corporation or body other than
the Board, and purporting to affect or bind any of such lands, live stock or equip-
ment or any part thereof, sold by the Board to a settler, or the increase of any
live stock so sold, shall, while the sale price of such lands, live stock and equip-
ment, or of any part thereof, or any interest on such price thereof, remains un-
paid, have, as against the Board, unless with the consent of the Board, any effect
whatever;
(e) if the produce or crop of any lands which were sold by the Board to a settler
or of any lands upon the security of which the Board has made any advance of
money is seized or taken in execution or under any other process, "whether the
settler shall or shall not have fully paid for said lands, and whether said prod-
uce or crop is seized or taken standing, or cut. or in barn, or otherwise, such prod-
uce or crop shall stand charged with a lien in favour of the Board for paymen t
of all instalments due or overdue by the settler to the Board at the time of seizure
or taking, in respect of the settler's land, live stock, equipment and permanent
improvements, and, as well, all such instalments in respect as aforesaid as will
mature within twelve calendar months thereafter.
(2) All lawful transactions by or with and all lawful proceedings against the settler,
and all provincial law? affecting him or his property or his property interests, shall.
as respects any property, real, personal or other, sold to him by the Board, or charged
with any claims of the Board, have effect except as by this Act provided.
(3) Unless the Board shall otherwise consent all liens and charges of the Board
shall, while and for so long as they or any part thereof shall remain unpaid to the
Board, rank upon the property of the settler, or against his interest in any property
subject to lien or charged, in priority to all other liens and charges, and the liea*
and charges of the Board shall rank pari passu.
(4) The Board may require of any settler the execution of a mortgage, in such form
as its regulations may prescribe, denning and securing any charge which is by this or
by the former Act imposed or declared to exist or is agreed upon by the Board and the
se'ttler.
PART III.
COMPULSORY PURCHASE OF LANDS.
SETTLEMEXT AREAS.
35. (1) For the purpose of enabling compulsory purchase of agricultural lands in
execution of the purposes of this Act, the Board may establish and define the limits of
settlement areas.
(2) Settlement areas shall be established only in districts wherein by reason of
lands remaining undeveloped agricultural production is being retarded.
(3) The Board shall be sole judge as to whether or not in any district, by reason of
lands remaining undeveloped, agricultural production is being retarded, and the fact
of the establishment of a settlement area in manner by this. Part of this Act provided
shall be conclusive proof in any court or otherwise that any lands within such area
which the Board, pursuant to the following provisions of this Part, may proceed to
compulsorily purchase are compulsorily purchaseable hereunder, and that such
settlement area answers the requirements of the next preceding subsection.
36. (1) A settlement area shall be deemed to be established when the Board has
gazetted a notice of such establishment four times with intervals of not less than live
days between each gazetting.
(2) S*uch notice shall define the limits of the settlement area so established. It
shall be sufficient if in form as nearly as may be to Form A in the Schedule to this Act .
(3) The Board shall, in addition to such gazetting, publish like notice to that
gazetted four times, with intervals of not less than five days between each publication,
in one newspaper having a circulation throughout the district wherein such settlement
area is wholly or partly contained and mail two copier of the Gazette in which such
notice first appears to the Registrar of Deeds in said district.
(4) Such Registrar shall preserve such Gaze'te on file in his office.
(5) The omission on the part of the Board to comply with subsection three of this
section, or the omission of the Registrar to comply with subsection four to this section,
shall not invalidate nor render insufficient any proceedings on the part of the Board
for compulsory purchase.
DEVELOPMENT OF AGRICULTUBE IN THE UNITED STATES. 119
37. The Board may. from time to time, curtail, extend or in any other way alter the
limits of, or entirely disestablish a settlement area, which shall be deemed to have been
done when it has gazetted notice of the alteration or disestablishment in like manner
to the gazetting of notice of the original establishment of the area, save that in the case
of disestablishment only one gazetting shall be made. The notice shall be sufficient
if in form as nearly as may be to Form B in the Schedule to this Act. The Board
shall publish and mail and the Registrar of Deeds shall preserve on file in manner
like to that in section thirty-six provided with respect to the original establishment of
the settlement area (save that in the case of disestablishment onlv one publication shall
be made), but non-compliance shall have like absence of effect.
38. Gazetting as in section thirty-six and thirty-seven of this Act provided shall
constitute notice to every person proposing to deal with or acquire any estate or interest
in or any charge upon anv land within a settlement area that the land is subject to the
provisions of this Act, and shall put such person upon inquiry as to the proceedings
which may have been taken by the Board, and all subsequent registrations in respect
to anv parcel of land which is in whole or in part included within such settlement
area shall be subject to the rights, options, and privileges of the Board, and the person
claiming under anv such registration shall take the land subject to all charges and lia-
bilities which have been imposed and to which it may be liable to be subjected under
this Act.
DUTIES OF OWNERS OF LANDS WITHIN A SETTLEMENT AREA.
39. (1) Within thirty days after the last gazetting on the establishment of a settle-
ment area, each owner of a block, the whole or anv part whereof is situate within the
settlement area, shall file with the District Superintendent of the Board having juris-
diction over the district within which such settlement area is situate a return in Form
C in the Schedule to this Act naming the prices at which he is willing to sell the block
and each parcel thereof to the Board. Tie shall give such other information with re-
spect to such block as the Board mav from time to time prescribe or require.
(2) At anv time after the expiration of such thirty days period the Board may, by
notice to the owner of any land within the settlement area which is deemed bv the
Board subject to compulsory purchase under this Act, mailed to his last known address,
require such owner to convey to the Board the land with respect to which notice has
been so mailed and thereby advise him of the amount of compensation that the Board
is willing to pay for such land.
40. Every person who has any estate or interest in any land proposed to be com-
pulsorily purchased for any of the purposes of this Act. or who represents or is the
husband of any such person, shall, upon demand made therefor by or on behalf of
the Board, furnish to the Board a true statement showing the particulars of such
estate and interest and of every charge, lien and encumbrance to which the same
is subject, and of the claim made by such person in respect of such estate and in-
terest.
PROCEDURE FOR COMPULSORY PURCHASE.
41. (1) If the Board decides to acquire any land within a settlement area and,
(a) the owner refuses to sell; or.
(6) it appears to the Board that no agreement for sale can be arranged; or,
(c) no proper deed or conveyance is made and executed by the person having the
power to make such deed or conveyance; or.
(d) a person interested in such land is incapable of making or executing a deed or
conveyance; or,
(e) for any other reason the Board deems it necessary or advisable;
the Board may purchase such land compulsorily. in manner hereinafter provided.
(2) The Board shall gazette a notice in Form D. describing the land by metes and
bounds or otherwise, and stating that it has been compulsorily purchased by the Board
and the amount of compensation money that the Board is willing to pay. whereupon
the land as described shall by such gazetting and by force of this Aft become and
remain vested in the Board as for an estate of fee simple in possession or. in trie province
of Quebec, in the Board as absolute owner, and in any event freed and discharged
from all other estates and from all encumbrances, liens, claims and interests what-
ever, and as effectually as if it had been conveyed by deed or conveyance of all per-
sons entitled to any interest therein, but compensation, ascertained as in this Part
provided, shall be paid therefor. The amount of compensation money mentioned in
such notice gazetted shall be deemed to have been by such gazetting and by force
of this Act. tendered to the persons entitled to any interest in said land, collectively.
(3) The gazetting of the notice in Form D shall for all purposes be conclusive proof
that all necessary steps and conditions precedent thereto have been duly taken and
complied with.
120 DEVELOPMENT OF AGRICULTURE IX THE UXITED STATES.
(4) In case of any omission, misstatement or erroneous description in such gazetting
it shall, at the option of the Board, be deemed not to have been made, and a new
and correct gazetting which shall indicate the gazetting of which it is the correction,
shall be made in its stead, whereupon such new and correct gazetting ehall be deemed
the only gazetting made and of itself proof for all purposes of the exercise by the
Board of the option in this subsection mentioned.
(5) If within sixty days from the date of such gazetting the owner being in the
province or in any place in North America, or within one hundred days the owner
being elsewhere, no proper deed or conveyance to the Board is made and executed by
the person or persons having power to make and execute such deed or conveyance, or
if the owner or any person interested in the land, by notice served on the Board before
the expiration of the stated period, claims that the compensation tendered by such
gazetting is inadequate, the Board may cause to be exhibited in the Exchequer
Court an information in which shall be set forth,
(a) the date at which and the manner in which such land was acquired or taken;
(6) the persons, who, at such date, had any estate or interest in such land and the
particulars of such estate or interest and' of any charge, lien, or encumbrance to
which the land was subject, so far as the same can be ascertained:
(c) the sums of money which the Board is ready to pay to such persons respectively,
in respect of any such estate, interest, charge, lien or encumbrance; and,
(d) any other facts material to the consideration and determination of the questions
involved in such proceedings.
(6) Such information shall be deemed and taken to be the institution of a suit
against the persons named therein, and shall conclude with a claim for such a judg-
ment or declaration as, in the opinion of the Board, the facts warrant.
(7) The information shall be served in like manner as other informations and all
proceedings in respect thereof or subsequent thereto shall be regulated by and shall
conform as nearly as may be to the procedure in other cases instituted by information
in the Court.
(8) Any person who is mentioned in any such information, or who afterwards is
made or becomes a party thereto, may, by his answer, exception or defence, raise
any question of fact or law incident to the determination of his right to such com-
pensation money or any part thereof, or in respect of the sufficiency of such compen-
sation money.
(9) Such proceedings shall, so far as the parties thereto are concerned, bar all
claims to the compensation money or any part thereof, including any claim of dower,
or of dower not yet open, as welfas in respect of all mortgages/hypothecs or encum-
brances upon the land or property; and the Court shall make such order for the dis-
tribution, payment or investment of the compensation money and for the securing
of the rights of all persons interested, as to right and justice, and, according to the
provisions of this Act and to law appertain.
42. If the Board decides to acquire by compulsory purchase any block which is
not within an existing settlement area, it may establish the block as a settlement
area, or it may by notice gazetted in the manner provided in section forty-one of this
Act, declare such block to be within an existing settlement area, of which area the
notice shall define altered bounds to include the block so decided to be purchased,
whereupon compulsory purchase proceedings may be conducted in even' respect
as if the block had been originally within an established settlement area.
43. Every registrar of deeds shall, upon receipt of any copy of the Canada Gazelle
containing any notice in Form D gazetted under this Act affecting lands within his
registration district, register, record or enter in the book or books, including index books,
in which, according to the law of his province with reference to the registration or re-
cording of grants, conveyances or transfers of land, grants, deeds or other documents
of conveyance or copies thereof or notations or references thereto ought by him to be
registered, recorded or entered, either the whole notice in Form D so "gazetted or
sufficient notations or references thereto or therefrom as will show that the land de-
scribed or the interest stated in such notice is or are owned by the Board absolutely
by right acquired under this Act, and upon any resale of such land or of part thereof
by the Board shall, when required, register, record or enter in such books the pur-
chaser thereof or of part thereof in accordance with the terms of any grant or convey-
ance from the Board presented for registration, recording or entry.
44. The compensation money agreed upon or adjudged for any land compulsorily
purchased for any of the purposes of this Act shall stand in the stead of such land
or property; and'any claim to or encumbrance upon such land or property shall, as
respects the Board, be converted into a claim to such compensation money or to a
proportionate amount thereof as may be allowed and shall be void as respects any
land so compulsorily purchased.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 121
COSTS.
45. The costs of and incidental to any compulsory purchase proceedings under
this Act shall be in the discretion of the Court, which may direct that the whole
or any part of such costs may be paid by the Board or by any party to such proceedings.
PAYMENT OF COMPENSATION OR COSTS.
4fi. The Board may pay to any person any sum to which, under the judgment
of the Court, in virtue of the provisions of this Act, he is entitled as compensation
money or costs.
INTEREST.
47. (1) Interest at the rate of five per centum per annum may be allowed on surh
compensation money from the time when the land was acquired or taken to the date
when judgment is given; but no person to whom has been tendered a sum equal
to or greater than the amount to which the Court finds him entitled shall be allowed
any interest on such compensation money from any time subsequent to the date
of such tender.
(2) If the Court is of opinion that the delay in the final determination of any
such matter is attributable in whole or in part to any person entitled to such com-
pensation money or any part thereof, or that such person has not, upon demand
made therefor, furnished to the Board within a reasonable time a true statement of
the particulars of his claim required to be furnished as hereinbefore provided, the
Court may, for the whole or any portion of the time for which such person would other-
wise be entitled to interest, refuse to allow him interest, or it may allow the same
at such rate less than five per centum per annum as to the Court appears just.
RESISTANCE TO PEACEFUL POSSESSION.
48. (1) If any resistance or opposition is made by any person to the Board, or any
person acting for the Board, entering upon and taking possession of any lands, the
judge of the Exchequer Court, or any judge of any Superior Court, may, on proof
of the execution of the conveyance of such land to the Board, or agreement therefor,
or of the gazetting of a notice in Form D as aforesaid, and after such notice to show cause
given in such manner as the judge prescribes, issue his warrant to the sheriff of the
district or township within which such lands are situated, directing him to put down
such resistance or opposition, and to put the Board, or some person acting for it, in
possession of the lands.
(2) The sheriff shall take with him sufficient assistance for such purpose, and shall
put down such resistance and opposition, put the Board, or such person acting for it,
in possession of such lands and forthwith make return to the Exchequer Court of such
warrant, and of the manner in which he executed the same.
INSPECTION AND SURVEY OF AND ENTRY UPON LANDS.
49. (1) The Board may by itself, its surveyors or engineers, superintendents, agents,
workmen and servants.
(a) enter upon any land to whomsoever belonging, make surveys of the same suffi-
cient for the exercise by the Board of any of its powers under this Act, and make
tests of the character of such land or of its streams, waters or watercourses; and,
' 1} after compliance with section forty-one of this Act enter upon and take possesion
of any land the acquirement of which is, in its judgment, necessary for the execu-
tion of any of the purposes of this Act.
(2) The Board may employ any person duly licensed or empowered to act as a sur-
veyor for any province of Canada or any surveyor or engineer, to make any survey, or
establish any boundary and furnish the plans and descriptions of any land acquired
or to be acquired by the Board for the execution of any of the purposes of this Act.
The boundaries of such land may be permanently established by means of proper
stone or iron monuments planted by the engineer or surveyor so employed by the
Board.
(4) Such surveys, boundaries, plans and descriptions shall have the same effect to
all intents and purposes as if the operations pertaining thereto or connected therewith
had been performed, and such boundaries had been established and such monuments
planted by a land surveyor duly licensed and sworn in, and for the province in which
the land is situate.
122 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
(5) Such boundaries shall be held to be the true and unalterable boundaries of such
land, if,
(a) they are so established, and such monuments of iron or stone so planted, after
due notice of the intention to establish and plant the same has been given in
writing to the owners or proprietors of the land thereby affected: and
(6) a proces-ierbal or written description of such boundaries is approved and signed
in the presence of two witnesses by such engineer or surveyor on behalf of the
Board and by the other person concerned: or, in case of the refusal of any owner
or proprietor to approve or to sign such proces-verbal or description, such refusal
is recorded in such proces-ierbal or description; and,
(c) such boundary marks or monuments are planted in the presence of at least one
witness who shall sign the said proces-verbnl or description.
t 6ilt shall not be incumbent on the Board or those acting for it to have boundaries
established with the formalities in this section mentioned, but the same may be
resorted to whenever the Board deems it necessary.
DIRECTIONS RESPECTING COMPULSORY PURCHASES.
50. In deciding upon cases meet for compulsory purchase of land under this Act
the Board shall, with respect to lands owned and occupied by farmers, consider
not only the district in which the land lies, the character of the land and the ade-
quacy of its acreage to enable successful farming operations, but, as well, the extent
of cultivation thereof, the circumstances of the fanner and his capacity to reduce,
within a reasonable time, a reasonable proportion of his cultivable land to a state of
cultivation. For the purposes of this section all land of a settler shall be deemed
to have been and to be occupied by him for the duration of his military service in the
war and for twelve months after his discharge.
PART IV.
MISCELLANEOUS PROVISIONS.
51. (1) All conveyances from the Board shall constitute new titles to the land con-
veyed and shall have the same and as full effect as grants from the Crown of previously
ungranted Crown lands.
(2) All land and other property which, before the coming into force of this Act.
was. under authority of any Order of the Governor in Council, purchased by the
Board and title thereto taken to His Majesty the King in the right of Canada repre-
sented by the Board, and all or any interest or interests of His Majesty in any agree-
ments of sale, mortgages or other instruments and in the land or other property to
which such instruments relate, which interest or interests were, before the coming
into force of this Act. acquired by His Majesty through the instrumentality of the
Board under the former Act or of any Order of the Governor in Council, are. by force
of this Act. vested in the Board as constituted under this Act.
52. No consent of the Board which is required by any provision of this Act for the
validation of any matter shall be effective unless given i'n writing and under the hand
of one of the Commissioners of the Board.
53. In the event of its being shown to the satisfaction of the Board that a settler
has established his right to benefit under this or the former Act through misrepre-
sentation, impersonation, dr other fraud, the Board may declare the right of such
settler to benefit under this or under the former Act to have been forfeited, and there-
upon all loans or advances made to such settler shall, unless the Board otherwise
determines, immediately become due and payable, and any sale of land made to him
under the provisions of this Act shall be liable to be rescinded, at the discretion of
the Board.
54. All affidavits, oaths, statutory declarations or solemn affirmations required to be
taken or made for the purposes of this Act. may, except as otherwise provided, be taken
or made before the judge or clerk of any court, any justice of the peace, any commis-
sioner for taking affidavits, any notary public, any person authorized to take affidavits
under the provisions of The Dominion Lands Act. any District Superintendent of the
Board, or any person specially authorized by the Governor in Council to take or admin-
ister the same.
55. The Board shall have the power to appoint persons to hold inquiries in aid of the
execution of any of the purposes of this Act. and every person so appointed shall have,
for the purposes of his appointment, all the powers of a commissioner tinder the
Inquiries Act. Every Commissioner of the Board shall have, e.r ojjicio in aid of the
execution of the same purposes, like powers.
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 123
56. ( 1) Any Commissioner of the Board, or any officer or employee of the Board
authorized, specifically or generally, in writing, by a Commissioner o'f the Board, may
enter r.ny land to whomsoever belonging for the purpose of making inspection thereof
and determining whether or not such land is subject to compulsory purchase under the
provisions of this Act: or, in the event of any land being deemed subject to com-
pulsory purchase, for the purpose of valuing the same or serving any notice on the owner
or occupant thereof or for any other of the purposes of this Act, or to view the condition
of, or to take over or repossess, in case of default made, any property in or over which
the Board has any interest or charge.
(2) Any person who resists or obstructs a Commissioner or officer or employee of the
Board in 'the execution of his duties under this Act is guilty of an offence punishable
on summary conviction by a fine not exceeding two hundred dollars, or to imprison-
ment for a term not exceeding six months.
57. From all sales and grants of land made by the Board all mines and minerals
shall be and shall be deemed to have been reserved, whether or not the instrument of
of sale or grant so specifies, and as respects any contract or agreement made by it
with respect to land it shall not be deemed to have thereby impliedly covenanted or
agreed to grant, sell or convey any mines or minerals whatsoever.
58. i 1 ) If the judge of the Exchequer Court shall so request, the Governor in Coun-
cil may. as and when requested, appoint one or more persons, qualified for appoint-
ment as judges of the Exchequer Court, to be judges ad h^c of such Court for the piir-
pose of assisting in the performance of the duties which are imposed upon such Court
by this Act.
Such persons, so appointed, shall, for all purposes, including paymant of salary,
be deemed judges of the Exchequer Court, but their several appointments shall be
terminable by the Governor in Council whenever the judge of the Exchequer Court
shall notify the (.overnor in Council that there is no further occasion for their assist-
ance, and they. si- > erally, shall have authority to transact, with the powers and juris-
diction of :\ judge of the Exchequer Toiirt. such business of the Court arising out of
this A< i a| said judge shall from time to time commit to them, and such only.
59. ( I Notwithstanding anything in this Act the Board is empowered,
(a) when estimating the value of any land for any purpose of this Act, to estimate
it apart from the value of buildings thereon;
far special reasons, in any case appearing,
(i) to vary the provisions of sections eighteen and nineteen of this Act so that
an amount not exceeding one thousand dollars may be diverted from the
amount not exceedinu r two thousand dollars, mentioned in section eighteen
as the balance which may remain unpaid upon a sale af stock and equipment,
and may be added to the amount not exceeding one thousand dollars, men-
tioned in section nineteen as that which may be advanced to provide or for
application to permanent improvements;
ii to \ary the pro-, isions of sections sixteen to nineteen, inclusively, of this
Act . so tii at li\ e stock and equipment to a value not exceeding three thousand
dollars may be sold to a settler, but so that the total amount of balance of
price and advances remaining unpaid by the settler as the result of the
exercise by the Board of any of its powers under this Act, shall not exceed
: thousand five hundred dollars.
oi .--lies of orchard or fruit lands, to apply the provisions of section
n LI this Act, with such other provisions thereof as may depend upon or
hit-.c ivlation to those of said section, as if for the words "live stock or equipment"
or "live stock and equipment acquired under authority of this Act " or words to
the same e. v ect in said section or in any of said sections appearing, there were
suUiituted the words "fruit trees, already planted or growing on any land sold
by the J Joard to the settler " and, for any purpose of this Act, to estimate the value
of tin- trees and shrubs already planted or growing on any land being sold by the
Board to the settler apart from the value of such land.
(2 i Wh'-n a settler dies indebted to the Board, under an agreement of sale or other-
wise, with respect to any property or to any advance charged upon any property, his
rights acquired under this or the former Act shall devolve upon his heirs, devisees or
personal representatives, pursuant to the law of the province in which at the time of
his death the property is situate, but subvert to all rights, claims and charges of the
Board respecting or affecting such property, and to performance by such heirs,
^devisees or personal representatives of all the obligations of his testate or intestate
with respect to such property or such advance, and default on the part of such heir,
devisee or personal representative with respect to any right, claim or charge of the
Board shall have the same effect as would default on the part of the settler but for
his death.
124 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
60. All mail matter deposited in any post office in Canada addressed to the Board
or to any Commissioner or officer thereof at the offices of the Board at Ottawa, and all
mail matter addressed by the Board or by any Commissioner or officer thereof at the
offices of the Board at Ottawa, to any place in Canada and bearing: thereon by imprint
or writing the words ''The Soldier Settlement Board of Canada' ' shall be carried free,
registered or otherwise, in the Canadian mails.
61. (1) No person, firm or corporation shall be entitled to charge or to collect as
against or from any other person, firm or corporation any fee or commission or advance
of price for services rendered in the sale of any land made to the Board, whether for
the finding or introducing of a buyer or otherwise.
(2) No person, firm or corporation shall pay to any other person, firm or corporation
any such fee or commission or advance of price for any such services.
(3) The Board may require of any person, firm or corporation from whom it pur-
chases land, or who is in any manner interested therein, the execution of an affidavit
in Form E in the Schedule of this Act.
(4) If any such fee or commission or advance of price is paid by or to any such
person, firm or corporation for any such services the following consequences shall
ensue,
(a) any person who in any affidavit made as required under subsection three of this
section wilfully and knowingly states an untruth or suppresses the truth with
respect to any matter which, pursuant to such subsection, he is required by way
of such affidavit to make disclosure, shall be guilty of an indictable offence and be
liable to a fine not exceeding five thousand dollars or to imprisonment for a term
not exceeding five years, or to both such fine and such imprisonment: and.
(6) the fee or commission or advance in price paid ma\ be recovered by the Board,
by suit instituted in the name of the Board as agent of Hi? Majesty, in any court
having jurisdiction in debt to the amount involved, whether the fron.-action was
one with respect to a sale or projected sale to the Board, as if such amount wore a
debt due to the Board, as aforesaid, and every person who participated in the
receipt of any part of such amount shall be liable to pa}- to the Board the part of
such amount actually received by him;
(c) All such consequences shall have operation cumulatively.
62. (1) Any person who is guilty of any wilful breach or non-observance of any
provision of this Act for which no" penalty is specially provided shall be liable on
summary conviction to a fine not exceeding one thousand dollars or to imprisonment
for a term not exceeding one year, or to both such fine and such imprisonment.
(2) Where at offence under" this Act, whether by way of breach or of non-observance
of any provision of this Act, is committed by a corporation, every officer or employee
of the corporation, who has in any manner aided or participated in the commission
of the offence shall be personally liable as for the commission of such offence by him,
and prosecution or conviction of any one officer or employee of the corporation shall
not be a bar to prosecution or conviction of any other of them.
63. The Board may, with the approval of the Governor in Council, and subject to
the provisions of this Act, make regulations, prescribing,
(a} the manner in which entries for land and applications for loans or advances may
be made;
(6) the conditions as to occupation or otherwise upon which free entries and patents
for land may be granted and issued;
(e) the security to be given for loans or advances, the conditions subject to which
loans or advances shall be made, and the manner and dates in and at which such
loans or advances shall be repaid ;
(d) the manner and conditions in and upon which settlers may transfer their rights:
(e) the conditions subject to which lands may be acquired for the purposes of this
(/) the manner in which lands acquired by the Board may be sold to settlers and
others and the conditions as to occupation or otherwise upon which such lands
may be sold;
(g) for priority of right as between applicant? to purchase property or lor soldier
grants or for advances or loans on the security of property:
(A) as to the qualifications necessary in order to entitle settlers to the benefits or
assistance or to any particular benefit or assistance under this Act. to the end that
the settler may ha've a reasonable prospect of success as a farmer:
(i) forms of agreements, mortgages, notices and other documents necessary to the
effective operation of this Act:
(j) advanced rates of interest to be paid by settlers who may be in default, such
rates, however, not to exceed seven per centum per annum;
DEVELOPMENT OF AGRICULTUEE IN THE UNITED STATES. 125
/.- > the eucum0taoeea and procedure under which and whereby the Board may take
over or repossess property in case of default made by settlers in the observance of
the pro visions of this or off the former Act or of any covenant or agreement made by
settlers witli the Board:
authority and procedure for the inclusion within the expression "settler" of
persons who. being otherwise qualified to be settlers, are not yet discharged from
military or other service:
with' respect to blind or other partially but seriously incapacitated settlers
special provisions for assistance in settlement of small holdings or otherwise
inclusive of the remission of interest in whole or in part:
t to any other matter concerning which the Board deems regulations
jie'-e-^ary for the execution of the purposes of this Act.
Ml regulations made under authority of this Act shall be published in the
< i-'-.tltc. and. within fifteen days after the making thereof, shall be laid before
Parliament, or. if Parliament is not then sitting, shall be laid before it within fifteen
. Her the opening of its next following session.
ii !. 1 / .1(7. 1<>17. is repealed, but notwithstanding, all officers
and employees of the Board are continued in office and employment as if such repeal
had not icon had. all entries granted and loans made pursuant thereto shall, unless
otherwi-e 'ieU'rmi.fi by the ! ; oard. remain subject to the terms and conditions on
which re granted or made, and the Loan Regulations and Regu-
lations a:i>cting !>orni:iion Lands made and approved under the said Act, shall,
in cperative until lawfully repealed or amended.
(2 1 All matters instituted or tilings done under authority of,
t, 1917; or,
(in any regulations niaile theivund;>r; or,
(o any order of the (.overnor in Council;
which might have been instituted or done under authority of this Act (though insti-
tuted or done before this Act was passed t, shall, at the option of the Board, be deemed
to have been instituted or done under authority of this Act. and any thereof which are
now pending or in all. at the option of the Board, be deemed to have orig-
inated under this Act and may be continued, completed and enforced hereunder.
SCHEDULE OF FORMS.
FORM A.
THE SOLDIER SETTLEMENT ACT, 1919.
NOTICE OF ESTABLISHMENT OF A SETTLEMENT AREA.
Province
Limits of Settlement Area No. .
All concerned are hereby notified that pursuant to the provisions of Part Three of
The Soldier Settlement Act, 1919, the Soldier Settlement Board of Canada has estab-
lished and does hereby establish settlement area number (one, or as the case may be)
consisting of the lands'within the limits above defined, and that all owners of blocks
of land as defined by said Part of said Act situate within said limits are required to
comply with the terms of said Part of said Act or suffer the penalties by said Act pro-
vided and thereafter comply as aforesaid, notwithstanding. t
The Soldier Settlement Board of Canada,
X. Y.,
Chairman.
Ottawa (Date).
12'6 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
FORM B.
THE SOLDIER SETTLEMENT ACT, 1919.
NOTICE OF ALTERATION OF LIMITS OF (OR OF DISESTABLISHMENT OF) A SETTLEMENT
AREA.
Province
New Limits of Settlement Area No.
Old Limits of Settlement Area No. . .
(or "Disestablishment of Settlement Area No
described as follows" as the case may be.}
All concerned are hereby notified that pursuant to the provisions of Part III of
The Soldier Settlement Act, 1919, the Soldier Settlement Board of Canada has altered
the limits of its Settlement Area No , that these are now as first above de-
scribed and that all owners of blocks of land as defined by said Part of said Act situate
within said new limits who have not already complied with the terms of said Part
of said Act are required to so comply or suffer the penalties by said Act provided and
thereafter comply as aforesaid, notwithstanding. (Or "has entirelv disestablished its
settlement area No as above described and that all lands within the limits
of such former settlement area are hereby freed from the operation of the provisions
of said The Soldier Settlement Act, 1919," an the case may be.}
The Soldier Settlement Board of Canada.
X. Y.,
Ottawa (Date). Chairman.
FORM C.
THE SOLDIER SETTLEMENT ACT, 1919.
RETURN OF OWNER OF LAND WITHIN A SETTLEMENT AREA TO THE SOLDIER SETTLEMENT
BOARD OF CANADA.
Province
Limits of Settlement Area No. . .
Names and Post Office addresses of person or persons making return
The undersigned files this return with a District Superintendent of the Soldier
Settlement Board of Canada pursuant to the provisions of Part III of The Soldier
Settlement Act, 1919.
The undersigned owns or own personally (or if owner along with others state names
and extent of interests of others and their post office addresses i within the settlement
area above described, the following described parcels of land:
Parcel No. 1 (insert
location and description).
Parcel No. 2 (insert.
location and description).
Parcel No. 3, etc.
Parcel No. 1 was cultivated to the extent of
per centum of its area during the season of 191. . and its average cultivation for the
two immediate preceding seasons was per centum of its area. Parcel No.
1 is encumbered as follows
(give description of encumbrances and names and post office addresses of the holders
thereof).
DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES. 127
Parcel Xo. 2 i give the same particular? as to each parcel).
The owner if willing to Fell hi* interest in Parcel Xo. 1 to the Board to be applied
to the purposes of The Soldier Settlement Act, 1919, for the sum of
dollars.
The owner is willing to sell his interest in Parcel Xo. 2 to the Board to be applied
to the purposes of The Soldier Settlement Act, 1919, for the sum of
.dollars.
Give the same information as respects each other parcel.
The owner is willing to sell his interest in all the above-mentioned and described
parcels to the Board to be applied to the purposes of The Soldier Settlement Act, 1919,
for the sum of dollars.
There are buildings and improvements upon such land as follows: On Parcel Xo.
1 (short description). Parcel Xo. '2 and ( like particu-
lar- .
Dated at in the province of this
clay of 19..
Owner or oinurs.
Signed in the presence of
Witness to signature of
Witness to signature of
FORM D.
THE SOLDIER SETTLEMENT BOARD OF CANADA.
NOTICE OF COMPULSORY PURCHASE OF LAND.
Province
Settlement Area Xo
Description of Land Compulsorily Purchased
To all persons in any manner interested as owners or otherwise in the above described
land.
Take Xotice that the Soldier Settlement Board of Canada, pursuant to power pro-
vided in and by Part III The Soldier Settlement Act. 1919, has compulsorily
purchased the above described parcel (or parcels) of land, that said Board is willing
to pay therefor the sum of dollars,
and that by publication of this notice and by force of said Act the said described
land is now vested in said Board as for an estate of fee simple in possession (or, in the
province of Quebec "in said Board as absolute owner") freed and discharged from all
other estates and from all encumbrances, liens, claims and interests whatever and as
effectually as if it hid teen conveyed to the Board by deed or conveyance of all
persons entitled to any interest therein, but that if the owner or other persons inte-
ested in said described land are not willing to accept as payment for his or their re
spective interests in or claims against said described land 'in full of their interests
and claims the amount of compensation money mentioned in this notice, other com-
pensation to be ascertained as provided in said Part III of said Act. will be pa,id by
said Board.
The Soldier Settlement Board of ( anada.
X. Y..
Chairman.
Ottawa (Date).
128 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
FORM E.
AFFIDAVIT OF VENDOR OF LAND TO THE BOARD.
IN THE MATTER OP THE SOLDIER SETTLEMEXT ACT, 1919.
I, of in the
of , Province of , (occupation) make
oath and say as follows :
1. Produced herewith and shown to me and marked Exhibit A by the functionary
before whom this affidavit is sworn is a certain conveyance of land to the Soldier
Settlement Board of Canada.
2. IJiave personal knowledge of the matters hereinafter deposed to.
3. Xo person, firm or corporation has collected or attempted to collect from me,
nor been paid by me nor, so far as I am aware, has any person collected or attempted
to collect from any other person, whether interested in the land to which such con-
veyance relates or otherwise, or charged as against any person, or been paid by any
person any fee or commission or advance of price for services rendered in the sale of
such land to the Board, whether for the finding of a buyer or otherwise.
4. The last sale of said land (or part thereof) previously to the taid conveyance to
the Board was made on or about the day of 19
The grantors were of
and the grantees were There was paid for
said land on that occasion the sum of dollars
which is an average of dollars per acre. The
improvements made upon said land since said sale have been as follows: .
5. The consideration mentioned in said Exhibit is
dollars and the persons who are to receive the same and the amounts that each is
entitled to receive, and to whom the Board may make payment direct, are now truly
stated, to wit:
(a) (name, post office address and amount receivable)
(b) (name, post office address and amount receivable)
(c) (name, post oince address and amount receivable)
Sworn before me at
in the
province of
this dav of
19..
EXHIBIT B.
10-11 GEORGE V.
CHAP. 19.
An Act to amend The Soldier Settlement Act, 1919.
[Assented to llth May, 1920.]
His Majesty, by and with the advice and consent of the Senate and House of Com-
mons of Canada, enacts as follows:
1. Section two of The Soldier Settlement Act, 1919, chapter seventy-one of the statutes
of 1919, is amended by adding at the end of paragraph (*) thereof the words following:
"Further provided that the word 'settler' as applicable to the class of persons num-
bered (3) in this definition shall be deemed to include male settlers only."
2. Section three of the said Act is amended by adding at the end of subsection one
thereof the words following: "lie shall have and be accorded the same rights or
privileges as to transportation, free or at reduced rates, upon railways, as are from
time to time enjoyed by a deputy head of a Department."
3. Section seventeen of the said Act is amended by striking out the words "acquired
by purchase" from the second line of subsection two thereof. Said section is further
amended by inserting between the word "effected" and the word "by" in the last
line of the section the words "or to be effected.''
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 129
4. Section thirty-two of the said Act is repealed and the following is substituted
therefor:
"32. (\ Every settler obtaining advances from the Board for any of the purposes
of the Act may be required, if the Board considers the security otherwise insufficient,,
to furnish security on any property owned or held by him.
"(2) All agreements of sale or otherwise, all instruments evidencing liens or charges,,
and all other documents authorized or required by this Act. shall be made in such
form and according to such forms, and shall contain such provisions as the Board
shall provide, and every such document shall have effect as if the form thereof were
statutory, and were provided by and as part of this \<-t."
5. Section fifty-nine of the said Act is amended by adding at the end of subsection
one thereof the following paragraphs:
'/> in all cases of sales of unimproved lands, to vary the terms of payment provided
by section sixteen of this Act so that the h'rst annual instalment shall be repayable
not later than two years from the date of the sale and shall consist of the accrued
interest only:
' in all cases of sales of stock and equipment for the operation of unimproved
lands, to vary the provisions of section eighteen of th ; s Act so that the terms of
payment shall be all cash down. or. at the option of the Board, payment in not
more than six equal, consecutive, annual instalments. ( ommencing not later than
three years from the date of the sale, with interest at five per centum per annum,
on the amortization plan, said interest to begin to accrue two years from the date
of the sale:
"(/) in all cases of sales of stock and equipment for the operation of improved farms,
to vary the provisions of section eighteen of th ; s Act su that the terms of payment
shall be all cash down, or. at the option of the Board, such per centum cash down,
as the Board may determine, and the balance be repayable in six, or less, equal
consecutive, annual instalments commencing upon a date determined upon by
the Board, but not later than two year- from the date of the sale, with interest at
live per centum per annum, on the amortization plan:
ii for any purpose of the Act, to determine what constitutes unimproved or im-
proved land or a farm;
"(k) in all cases of sales of seed grain and feed or in cases of advances for the pay-
ment of taxes and insurance, to require that the settler's^indebtedness to the
the date Board in connection with such sale or advance be repaid within one
year from of the advance, with interest at the rate of five per centum per annum."
*:. Se< tion sixty-one of the said Act is amended by adding at the end thereof the
following subsection:
No officer, agent or employee of or under the Board shall directly or indirectly,
in his own name or in that of any other person, except by or under the authority of
the Board, purchase, acquire or sell any land or other property of such character a--
the Board is authorized to purchase, acquire or sell under this Act from or to any
settler who is indebted to the Board or whose application for an advance or to purchase
any property from the Board is pending, nor shall such officer, agent or employee
act as an age'nt or otherwise of any person in purchasing, acquiring, or selling or other-
wise as aforesaid, nor receive any commission or compensation in connection there-
with, and any officer, agent or employee violating the provisions of this subsection
shall in addition to any criminal liability incurred pursuant to the provisions of this
Aci. be liable to summary dismissal on the order of the Board and the liability to or
imposition of such penalt'y shall not affect the right which any person may have to
briir_: a '.rain si him any civil action."
7. Section sixty-three of the said Act is amended by adding at the end of paragraph
(c) the words following: "including dates at which amortized or other payments-
shall be consolidated or commence. ''
8. The following sections are added to the said Act as sections sixty-five and sixty-
six:
"65. (1 ) The marks or brands specified in this section in that behalf may be applied
in or on any property of the Board to denote the Board's ownership or interest in such
property. But the omission to apply any such mark or brand shall not affect such
ownership or interest.
5666421 9
130 DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES.
Marks appropriated for the use of the Soldier Settlement Board in marking its property.
Property. Marks or Brands.
Live stock Upstanding broad arrow with its base abutting on lazy S,
with or without any numerals in any order.
Equipment Broad arrow with its base abutting on lazy S.
"(2) It shall be lawful for the Board or its officers. airents. and workmen to apply
such marks or brands, or any of them, in or on any such property.
; "(3) No person shall, without the authority of the Board, the proof of which shall
lie on him, apply any of the said marks or brands in or on any property of the Board,
nor take out, destroy or obliterate, wholly or in part, from any property, any of the
said marks or brands.
"(4) No person shall, without the authority of the Board, the proof of which shall
lie on him. receive, possess, keep, sell or deliver any property bearing any marks or
brands as aforesaid .
"(5) Notwithstanding any law, whether statute or otherwise, in force in any Prov-
ince, authorizing or requiring the registration or recording of marks or brands, or
prohibiting the use of any mark or brand which has not been registered, or prescrib-
ing any procedure to be 'followed in connection therewith, the use and application
by the Board or any of its authorized officers or employees of the said marks or brands,
shall not s: long as any ownership or interest of or in the property affected is vested in
the Board, be subject to or within the operations of such ptovinciftl laws.
"tiii. ' I ) While a settler is indebted to the Board in connection with sale of land <>i
other property to him by the Board, or while any sum remains unpaid upon the
aggregate advances or payments made from time to time pursuant to the provisions
of this Act or otherwise to'or on behalf of the settler, and secured by or charged whether
under this Act or otherwise, upon property, real, personal or other, of the settler, or
upon the settler's interest in any property, the Board may require that the settler
s'hall insure in favour of the Board anv property to the extent of its insurahle value
and shall assign and deliver over unto the Board, as the interest of the Board may
appear, the policy or policies of insurance or receipt or receipts thereto appertaining.
and deliver t3 the Board all receipts for taxes paid upon any such propertv. insured
or otherwise.
"(2) Notwithstanding anything to the contrary in this Act. if the settler fails or
negle. ts to pay any lawful rates, taxes or assessments, or to keep such property insured
as afore md, then it shall be lawful for the Board to pay such rates, taxes or i
ments. or to insure such property as aforesaid, and all moneys expended by the Hoard
with interest at the rate of seven per centum per annum computed from the time of
advancing the same shall be repaid by the settler on demand, and in the meantime
the amount of such pivment shall be added to the purchase price of suoh propertv,
or shall become a part of the principal secured bv any change, lien or mortgage in
favour of the Board, as the case may be. and may in the discretion of the Board be made
repayable at the time appointed for the payment of the next installment in connc tion
with the account to whi.?h such indebtedness is charged. "
Mr. LITTLE. Where do they get that land ?
Mr. JONES. They take public land and they buy private land also.
Mr. LITTLE. Where?
Mr. JONES. Anywhere in Canada.
Mr. LITTLE. Which one of the States up there ?
Mr. JONES. The bulk of it is from Manitoba and west. I have seen
the figures. Most of it is from Manitoba and west of there.
Mr. LITTLE. Alberta and Saskatchewan?
Mr. JONES. Yes; Alberta, Saskatchewan, British Columbia, and
Manitoba. I think those four western Provinces were the bulk of it.
Mr. HAYDEX. That is due to the fact that there is a larger area of
public land in those Provinces than there is east of them.
Mr. JONES. Yes; and the board can also buy private land, but of
course in making a loan to buy private land the settlement board
makes the purchase and approves the valuation before they make the
purchase.
Mr. LITTLE. Wliat has been the success of those private land pur-
chases at high prices ?
HKVK.LOPAIKXT OK ACKKTLTrRK IX T II K UNITED STATES. 131
Mr. JONES. I have no knowledge of what prices they have paid.
In fact, I looked their report over very carefully to find out how much
land they had taken privately and how much was public lands, and
there is not a thing in their report to show. It simply shows a total
of so many farms with a total of so many acres, and that is the
reason I hope to get their annual report, because I think that will
segregate it.
The CHAIRMAN. Now. have YOU anvthing further, Mr. Jones, to
offer >
Mr. .IONKS. I think that is all, except I do want to impress upon
the committee that regardless of the tact that you may nave heard
a great deal more talk about other demands of ex-service men, of
course the campaign for taking care of compensation and so on
which is now being handled in the Senate bill and the campaign for
the bonus, the fact remains that the demand for land among the very
best character of ex-service men, the very best character of American
citizens, is just a- large as it ever was. if they can actually see their
way to get it, and there will be anywhere from 5 to 100 applicants
for every farm as fast as it is opepau up for 10 years.
The CHAIRMAN. I think you are correct in that, from my own
observation.
Mr. HKRRICK. Before you leave I just want to ask a question or
two. Isn't it rather a fact that the ex-service men as a whole realize
that there can't be any such thing as a free homestead or out and out
land grant : that about all he can hope for is some kind of a preference
clause in anv of this land opening or these reclamation acts or any-
thing of that nature, and that as an actual fact he really looks for
both the bonus and this preferential legislation?
Mr. .IONKS. I think he does.
Mr. HKRRK K. That has been my experience.
Mr. JONKS. There is no question but what he will ask for both -
we will ask for both.
Mr. SINXOTT. You refer to soldiers of former wars receiving land-.
What wars do you refer to (
Mr. JONES. Well, the veteran- <>f the Civil War settled a good deal
of land in the West and Middle Western State>. I don't know the
proportion.
Mr. SIN.NOTT. Well, did they receive land or did they just receive
certain credits for their servie,
The CHAIRMAN. There was some bounty land, or scrip.
Mr. JONKS. I think there was some bounty land and homestead
preference that extends to this day. Of course that was free land
and there wa> lots of it.
Mr. SIXXOTT. I don't recall the soldiers of the Civil War receiving
any land grants: they did receive certain privileges.
Mr. JONES. 1 think that was the fact, that there was available free
land at that time, which was perfectly fertile land.
Mr. LEATHERWOOD. Didn't they get a good deal of land on what
is known as land scrip? Didn't the Government issue to them what
really amount> to the right to take up land (
Mr. SIXNOTT. That was prior to the Civil War. The Civil War
soldiers, of course, had the advantage of the homestead act, which
was passed shortly after Lincoln's time.
Mr. LEATHERWOOD. But if I am not greatly mistaken, I think there
were some concessions made after the Civil War.
132 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATK>.
Mr. HAYDEX. As I understand it, the law provided that scrip might
be issued in connection with services in the Civil War so that where a
veteran of that war was entitled to 160 acres of land, for instance,
and he only located 80 acres, then the General Land Office issued
what they called ''soldiers' additional scrip" for the difference be-
tween the land to which he had obtained a patent and the total area
to which he was entitled. That scrip he could sell for cash, and it
passed into the market; anybody could apply it and use it.
Mr. LEATHERWOOD. Or couldn't he go and take additional land on
it '.
Mr. HAYDEX. The scrip was issued to the veteran and he could use
it himself or sell it to somebody else.
Mr. RAKER. Before you go/Mr. Jones ; I just want to ask this one
question.
What do you mean by the bonus and the land settlement too ?
Just what am I to take from that answer \
Mr. JONES. Well, the gentleman asked me if the soldiers would not
ask for this preference and for bonus as well, and I said very likely
they would. As the bonus bill tibw stands, it is a fivefold bill. The
Fordney bill has the land settlement feature in it. while the Senate
bill has it cut out.
Mr. RAKER. You have got to provide means whereby you can get
the land and get it into shape ; if it is arid or semiarid you have got to
provide water for it, and if it is cut over you have got to provide for
its cleaning up, or money for that purpose. The same is true of the
swamp lands. The thing is to get the money and have this work
done and give the ex-service man an opportunity, a preference right
to do the work; put the farm in some shape and then give them
preference right to file on it for a home. You are giving him some-
thing then, aren't you?
Mr. JOXES. Yes, I think that is the purpose of this bill, and it is
very necessar\ T .
Mr. RAKER. And this bill will go to that extent along the reclama-
tion of arid and semiarid lands, and you think there is a very large
percentage of the ex-service men standing behind this character of
legislation ?
Mr. JOXES. Absolutely. I think they will be solidly behind it.
I don't think that they would say, "We will take preference and
eliminate any claim that we may have for a bonus,'' because not all
the soldiers could get land: not half of them. I don't know what
proportion could.
Mr. SINNOTT. Mr. Jones, to keep the record of this committee
clear, you understand this committee has no jurisdiction over the
bonus feature ?
Mr. JOXES. I understand that perfectly well. I think this is a
reclamation bill with soldier preference, not a bonus bill.
Mr. SMITH. And this legislation is intended to benefit the soldiers
in addition to any legislation that may be enacted under the bonus
plan *
Mr. JONES. I so understand it. As a matter of fact. I think that
the technical provisions of this bill are superior and will create a good
deal more land, a good may more opportunities, more funds for
soldiers than the land features of the bonus bill, which has a co-called
settlement clause in it. I think this bill will create more available
DEVELOPMENT OF AGRICULTURE IN THE UNITED STATES. 133
lands, make more farms for more soldiers than the land settlement
feature of the bonus bill, but land settlement is only one of four
features in the bonus bill.
Mr. RAKER. Now, this is just simply a question, signifying no
attitude as far as I am concerned, and I am satisfied it signifies the
attitude of no one on the committee, but I am just going to ask a
question.
Is it your view that we would get better results and do more for
the ex-service man if, instead of figuring on a bonus, a cash bonus,
we would provide ready money now, enough at least to start this
kind of work going, whereby you could in a short time provide him a
home, or as many homes as you could, and keep increasing it from the
revolving fund ? Would we do more for the ex-service man by doing
that than we would by giving a cash bonus?
Mr. JONES. You mean to ultimately provide that opportunity for
every ex-service man ?
Mr. RAKER. Yes, just as far as we can go.
Mr. JONES. Just as far as you can go doesn't mean every ex-
service man. That is the difficulty. I will say that the home
opportunity is wortji a great deal more than the bonus, than the
cash bonus, but I must in fairness say that I don't see why you can
create that home opportunity for the 4,000,000 to 5,000.000 men who
are looking for some compensation.
Mr. RAKER. I don't think we ought to assume that this Govern-
ment is not capable of furnishing a home for every soldier that wants
to go on it. We have the land; we have the climate; we have the
opportunity for him to work, and the question is to get the public
behind it so as to start to work and then keep a revolving fund until
these men get these homes.
Mr. JONES. As near as you can do that, your home aid or your
home opportunity is certainly vastly more helpful to the individual
and the country at large.
Mr. LITTLE. t)o you think that one man should get a farm and the
bonus too, and another man should get nothing but the bonus?
Would that be equitable ?
Mr. JONES. I am assuming in that position that you are not giving
him a bonus when you are giving him this preference. Now you
might justly assume that you are, that you are giving him something
very tangible, very valuable.
Mr. SMITH. Is it not quite likely. Mr. Jones, that if we should enact
this legislation and start in on this great expenditure, that the ex-
service man in the industrial centers would be benefited because of
the constant employment he would have, by reason of the increased
market created on account of this expenditure of money in the rec-
lamation of land ?
Mr. JONES. He would. I think everybody in the United States
would be benefited.
Mr. SMITH of Idaho. It is more important that the ex-service man
have permanent employment than it is to have $100 in cash and
probablv unemployment for years.
Mr. JONES. There is no question that he would be benefited.
How immediately or directly would be hard to say, and he would
find a good many ex-service men that would not immediately grasp
the fact that they were getting that benefit. I think it is there
unquestionably.
134 DEVELOPMENT OF AGRICULTURE IX THE UNITED STATES.
Mr. RAKER. Xow I did not quite carry out my thought, and I
want, with the addition of Mr. Smith's suggestion, which is valua-
blewe have been working two years and have got nothing: we
haven't got employment for these men; we haven't provided for their
homes; we haven't provided them a bonus, and what I am asking you
as a representative of the ex-service man. knowing their desires,
knowing their interest, knowing what the country wants to do, if
we can get at it, if it would not be better, rather than to keep putting
off the question of bonus and the large amount of outlay entailed, if
it would not be better if we commenced to provide homes for these
men under the methods provided in this bill, and other legislation of
kindred nature whereby it provides a home for the man rather than
to stop this development and give a cash bonus ?
Mr. JONES. Well, I think you are right about that, as you state it.
Mr. RAKER. I am asking you for information, because I know with
the committee and everybody that is interested, that we seem at
loggerheads, because there are so man}' opposing the cash bonus in
the large centers, and then there is a question that if you pay that
money out they will have nothing to do the work with, and the
question in my mind is which will be better for the ex-service man as
a class and the country generally, to give them the cash and let them
spend it, or take this money and add as much to it as we can and
make a revolving fund and build homes for them.
Air. JONES. I think the home building unquestionably is the more
beneficial, but when I say that you understand 1 think that if you
put it to a vote of all the ex-service men with only the amount of
information they have to-day, they would vote for the cash bonus,
if they had to select between the two. because of many reasons.
many doubts, and many questions. They doubt whether they are
v doubt wl
?'
i\v say.
believe that the home opportunity is much more valuable.
Mr. HUDSPETH. That has been the result from the votes that have
been taken, has it not '.
Mr. JONES. Yes; when we took a straw ballot through our paper,
and other people have also, and the preponderance has been for the
cash bonus, liut as I say. that is largely because men have believed
that if they got the cash the}* would have it. and if they hoped for
any thing else they might never get it.
Air. SINNOTT. I low much of a preponderance was that (
Mr. JONES. I think 80 per cent were for the cash in the straw
ballots that we took through our paper, and probably the same
amount through others. .
Mr. HERRICK. If I may be permitted to butt into this talk again,
and I am going to assure my friend here that I am in entire sympathy
with his idea, but I am afraid there is one little point that must be
taken into consideration .and that is this: Some of these soldiers are
skilled laborers, skilled mechanics of course I am not undertaking
to say what percentage, but some of them are skilled laborers, and
being skilled laborers they make more money than they would on a
farm, and this percentage of skilled laborers, of course, could not be
gotten onto any land or to take advantage of what is proposed here,
although I am in sympathy with it, but the fact remains that there is a
going to get land; they doubt whether they are going to get anything
from the Government". So a great many ex-service men are simply
in that frame of mind that thev sav. ' Give me the cash." But I do
DEVELOPMENT OF AGRICULT IBIIIIIIIIIIIIIIIIIIIIIIIIIIIIllllllllllllll! 135
A 000016228 9
certain percentage of these ex-service men that are skilled workmen,
and you would not get them on the land; therefore unless you wished
to do them an injustice you would have to give them something in
the way of a bonus, wouldn't you ?
Mr. JONES. I took the general question for the benefit of the men
to get a home, not only farm loans but the opportunity of owning a
home anywhere. Of course you would not find every ex-soldier that
would want to go on a farm. I don't suppose hall of them would
want farms, but they do want homes.
Mr. RAKER. I am assuming this: Here are 100 men; none ol
them have the means to buy a home; wouldn't they much prefer,
rather than to take $500 cash, if arrangements could be made so in
his turn each might, within, say, 5 or 10 years, be able to get a home
by this combination and this providing the money, whereby you
could start in and let them draw for it, and eventually this one
would get a home and then that one would get it, and they would
all work in the meantime and build up the community, and in 10 or
15 years they would all have homes, and I was wondering whether
or not the ex-service man doesn't feel that way about it?
Mr. JONES. I think he does. I think if you could put it to him
in that way he would exactly agree with that proposition that it
would be worth more than the cash payment to him, if he is equally
sure of getting one or the other.
Mr. RAKER. I am just taking it from personal experience and
observation of other men. I would be willing to work 10 years if I
might be certain at that time that I was going to be able to get a
home.
Mr. HAYDEN. That is it, if the soldier positively knew that a
workable plan was going to be worked out in such a way that he
would actually get a home, he would say, "I will take the home."
But the ordinary young man who served in the Army does not
know that the Government is certainly going to adopt a policy of
that kind, and it is perfectly natural for him to say, "1 know what I
can do with some money if Congress will give it to me, and if money
is appropriated I will take it." He would rather have $500 in cash
than the promise of somebody, who up to this time is not qualified
to speak, that ultimately he will get a home.
Mr. SMITH. It is not $500 that they are going to get in cash under
this fourfold plan: it proposes to string it out over a period of three
years; maybe he gets $100 now and $100 in a year and $100 in three
years.
Mr. RAKER. So that I will not be misunderstood, and that you
will get me clearly on the record, my question presupposes and is
based upon the assumption that we will provide a law whereby these
men will know in advance, as far as human ingenuity can work it
out, that we will provide them a home and the Government stands
behind it. I am assuming that all the time. Don't you see that if
we first get that law on the statute books and then we~ both stand on
that provision that it would be a good thing to get homes ? Isn't that
right ?
Mr. JONES. Absolutely. In the State of Oregon the American
Legion took a poll based on the State bonus act, which has not yet
been approved by the people; it is to be voted on next Tuesday.
That bonus act allows in the State of Oregon an ex-soldier to either
136 DEVELOPMENT OF AGRICVLTUBE IN THE UNITED STATES.
take $15 a month cash bonus, $15 for each month in the service, or a
loan for home building or farms, either city homes or farms, not to
exceed $3,000. They took a poll through the American Legion to
estimate how many would select each way if the bill was passed
it probably will be passed by the voters on Tuesday next they
found that 60 per cent would take the loan and 40 per cent would
take the cash. That is the fairest test that I know of anywhere,
because there the men knew they could have either one; they could
have their choice.
Mr. SINNOTT. That is a fairer test than 80 per cent you mentioned
awhile ago.
Mr. JONES. Oh, yes; because that was based on a possibility and
this was based on a very definite bill.
The CHAIRMAN. We are very much obliged to you, Mr. Jones.
The committee will now go into executive session.
(Whereupon, at 11.55 o'clock a. m., the committee went into
executive session.)
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