to liquidate quickly to the highest bidder in order to meet that deadline. That is the law.

In order to remedy this bad situation, Mr. Neuberger and Mr. Morse sponsored bill No. 2047 at the last session of Congress, which authorized the Secretary of the Interior to purchase all the tribal lands from the Klamath Indian Tribe at fair market value. The timberlands would be transferred to and administered by the United States Forest Service and the approximately 25,000 acres in the Klamath Marsh would be administered by the United States Fish and Wildlife Service. Other lands would be sold on a competitive basis. Certainly this act would solve the problems if it could be passed. But with the huge appropriation necessary, probably more than $100 million, and with an economy-minded Congress, it is unlikely to be enacted.

We feel that legislation must be enacted with these provisions, that is, Federal administration of the Indian lands, and that payment to the Indians be carried out. But in order to get such legislation passed, a solution must be found to reduce the initial appropriation. Therefore, we suggest a compromise: Congress authorize the Secretary of the Interior to acquire the land and the United States Fish and Wildlife Service be given the administration of the upper Klamath Marsh. This 25,000 acres would be purchased at a fair appraised value, but perhaps at least part of the cost could come from duck-stamp revenues. The Indians would receive a suitable preliminary payment from the proceeds of this sale. The balance of the reservation could be hanaled as in Mr. Neuberger's bill, the United States Forest Service administering the timber and selling off other lands to the Indians or other highest bidders.

Any moneys from these sales would go to the Indians immediately. The rest of the money due on the basis of a fair appraisal of the timber would be paid off from timber sales on a sustained-yield basis over a period of 25 years, supplemented by appropriation, if necessary. There would not be the usual 25-percent payment to the county or counties until after the Indians were paid off. Such a plan would not involve a huge initial appropriation by Congress; it should aid in an orderly relocation and stable settlement program for the Klamath Indians. The United States Forest Service and the United States Fish and Wildlife Service would continue good conservation procedures in the management of their lands. And all the people of the United States will have acquired a wildlife refuge and a national forest with watershed protection, erosion control, wildlife and recreation values. We so recommend.

Senator NEUBERGER. Thank you, Mrs. Platt, very much. I would like to ask Mr. Wilcox a question, if I may. You heard the interesting proposal submitted on behalf of the Mazamas by Mrs. Platt. Do you think as outlined that this would provide the sort of price for the timber that the Indians seem to expect or not? What is your opinion as Mrs. Platt outlined this proposal?

Mr. WILCOX. Mr. Chairman, the basic provision of the present law is to provide a means for the Klamath people, or those of the Klamath people who wish to withdraw, to receive their share during a very short period of time. I doubt very much whether these people would agree to any returns on a long-term basis, say, 25 years, such as in this present proposal.

Senator NEUBERGER. Mrs. Platt, I wanted to mention one thing to you. I think this is a very interesting proposal and has a great deal of merit to it. One of the situations that we are up against is a practical one. If I am not mistaken-and I want Mr. Wilcox to check me for accuracy-a survey made on the request of the Management Specialists by the Stanford Research Institute has revealed that approximately 70 or 75 percent of the tribal members have indicated that they prefer to withdraw and receive their prorated share of the assets of the reservation. Is that right?

Mr. WILCOX. That is right.

Senator NEUBERGER. In addition, under the existing law, we are up against a very rigorous schedule, even more rigorous than you indicated in your presentation. You mentioned the date of 1960-August 13, 1960, is the final termination date. But if Public Law 587 stands on the books, the Management Specialists are bound to commence the liquidation procedure immediately upon adjournment of the next session of Congress, which probably would be the end of July 1958. So it is even much closer than 1960.

Many people in the State have the misconception that 1960 is the date we are up against. That is the final date. The real date we are up against is July 1958.

The thing I am afraid of-this is the first time I have seen this proposal and I think it has a great deal of merit and value to it-is the situation Mr. Wilcox pointed out in answer to my question: That a considerable proportion of the Indians, far more than half of them, want their assets so much more quickly, and we are dealing with private property here that belongs to the Indians. The Government has been trustee for it, but it is their private property, and I just wonder if this would satisfy the Indians. That is the only thing that worried me, and that is why I put the question to Mr. Wilcox, who has been working day to day with this situation.

Mrs. PLATT. Well, if I may say, one reason I made this suggestion was the fact that I was concerned about the previous bill-I mean this 2047-being able to pass carrying such a heavy appropriation, and I thought if it could be spread over a longer period of time there might possibly be a chance of it passing, and under those circumstances the Indians really might be in a position to gain more over a longer period of payment than they would by the liquidation, the fast liquidation of their assets. Now, that was my feeling.

I

Senator NEUBERGER. I just wanted to say, I share your fears. think passage of the bill is not impossible; I think the word "difficult" is probably the exact word, but I try to be realistic about it because when my bill S. 469, to postpone the termination came out on the Senate floor, it carried only an appropriation of $1,100,000 to reimburse the Klamath tribal funds, and it provoked 2 hours of economy oratory, and that was just a little over $1 million, so we are aware of the realities we confront. Are there any questions, Mr. Wolf? Mr. WOLF. Yes. In addition to Mrs. Platt's suggestion, I notice here that in the statement Mr. Weyerhaeuser made, he indicated that purchasers could pay cash or in the alternative pay the purchase price on an installment payment basis with a minimum downpayment. These installment payments could be used to meet the principal payments becoming due over the next 15 years to Indian minors upon reaching their majority.

The suggestion that Mrs. Platt makes, and it is in Mr. Weyerhaeuser's statement, both indicate a recognition of the difficulty of dumping this timber on the market, and both of them are proposing installment-type payments to the Indians.

This

Now, I think that that points up one of the basic defects in Public Law 587, regardless of what type of solution you propose. dumping operation is the thing which causes everybody concern, whether they want to buy the timber or whether they think some special arrangement should be provided for Federal purchase.

I would like to ask you, Mrs. Platt, if you were a member of the Klamath Tribe and you wanted to receive your full per capita payment now in order to invest it in some other stocks or bonds, or in a business or some other purpose, what would your reaction be to your proposal?

Mrs. PLATT. Well, I think I would take rather a long look at the tax situation, too. The payment in a lump sum might not be as much as it looks on the surface. I think it was estimated that it might be as much as $53,000 or $55,000, and I think I would want to go into that aspect of it as a consideration.

Mr. WOLF. Is it not correct, Mr. Gamble, that this will be tax free as far as the Indians are concerned?

Mrs. PLATT. Is it to be tax free? Well, then that would not hold. I think I would prefer the installment payments over a period of years as a member of a family, I think it would be much more desirable than to have a lump sum that I would suddenly have to make a great many decisions about. I have growing children and I would be interested in a long range-matter of education, and certainly if I had a resettlement program I think that would be much more desirable.

Senator NEUBERGER. The situation we are up against is this: I wasn't in Congress when the termination bill was passed-might I say thank heavens-but at the time it was passed, if I am not mistaken, and up until the present time, the Klamaths had been receiving from the sale of timber and other assets of the reservation approximately $800 annually per person, every man, woman, and child. So they have been receiving a relatively limited sum of money annually. I think that is tax free; is that correct?

Mr. GAMBLE. Yes.

Senator NEUBERGER. Tax free, which means, let us say, a family of 4 receives $3,200 a year now. That is the equivalent of around $4,000, or thereabouts, for another income which is subject to Federal taxation, so at the present time they have been receiving somewhat of an income from this and apparently they have not been satisfied with that and want this distribution of the assets. So that is the practical situation we are confronted with today.

I think your suggestion has a great deal of merit, but as I say, I wonder, just as Mr. Wilcox did, too, what this would encounter in the way of wishes or demands, if you care to phrase it that way, from the Indians. That is the one thing we have.

Mrs. PLATT. I am just interested in whether legislation would be possible.

Senator NEUBERGER. It is a very interesting suggestion and on behalf of all the subcommittee we thank you and the Mazamas for making this interesting proposal available.

Our next witness will be Mr. C. B. Stephenson, president of the First National Bank of Portland.

STATEMENT OF C. B. STEPHENSON, PRESIDENT, FIRST NATIONAL BANK OF PORTLAND

Mr. STEPHENSON. I have no prepared statement, Senator. Senator NEUBERGER. We are happy to have you here today. Mr. STEPHENSON. My name is C. B. Stephenson; I am president of the First National Bank of Portland. I have been a citizen and resident of Oregon all of my life.

I am somewhat familiar with Klamath County; we have a branch bank there. I have been familiar with this Indian matter ever since the passage of the bill, at which time management consultants were appointed, and almost immediately I found them in for help and advice, what to do. So the discussion began, then it continued over a period of time, somewhat in the abstract. Then on a more detailed basis when the question of creating some sort of trust of some of the proceeds involved for the benefit of the Indians either by their own choice or by reason of their incompetency or by reason of their being minors.

And that quickly posed problems for a corporate trustee of which we are one, and the whole question then began to develop problems and aspects resulting in some opinions and beliefs that I now possess, which I would be very happy to state.

Granted, the objects and purposes of the law as it now stands are desirable. The Government proposes to relinquish its wardship of the Indians which it has held these many years; this is desirable. But the effect of the law as it now stands is quite a different matter, certainly as regards the Klamath Indians and other tribes in that area and the resource which is involved.

I will speak first to the effect of quick liquidation of that resource and the distribution of the proceeds. The impact of quick liquidation would have repercussions on the economy of the State of Oregon. I feel that it would be very serious. The cutting and marketing of the forest of that size would disturb markets, clearly that. It would further violate the concept that we now have of maintaining forest stands on some type of perpetual basis, sustained yield if you want to use another word. The timber resource in the State of Oregon is the basis of the State of Oregon's economy. Sixty percent, roughly, of our income dollars come from that area. So you can quickly fill in for yourself, I think, some of the reasons why I would feel as I do on the subject of quick liquidation in toto and distribution of funds.

The second aspect of it has to do with the Indians themselves. Having been wards of the Government all these many years, I shall assume that they have not been preoccupied with financial matters, the investment of funds in any size. They comprise, as I said, people of mature years, minors, perhaps some incompetents. One can quickly envision the dissipation of their substance very quickly, with the result that they would then become instead of wards of the Government, if I may use that term, wards of Klamath County, and, in turn, the State of Oregon. In such a process I think a great disservice would be done to the Indians involved.

Now, that is the sum and substance of my statement, Senator Neuberger. I would be very glad to answer any questions.

Senator NEUBERGER. I appreciate your coming, Mr. Stephenson, and giving us the benefit of your experience in this matter and your contacts with the Klamath County community. How do you think we should proceed to avoid some of the calamitous events which I think you so accurately predict? For example, you mention should the Government presume to relinquish its trusteeship over the Klatmath Indians. Actually, in the passage of Public Law 587, in 1954, the Government terminated its trusteeship, so, for all intents and purposes, we are confronting here a fact, and not a theory. It has been ended.

Now, what particular remedy would you favor for us to forestall some of these rather tragic or disastrous events from occurring?

Mr. STEPHENSON. I could offer a suggested remedy which may be practical or impractical, or completely possible or impossible, I don't know. But if I could devise in my mind an agency of any character that could acquire that timber stand and operate this forest on a sustained-yield basis, that would be my No. 1 proposal, that the conservation of the resource is necessary.

Now, to give a specific answer, I have not been able to contrive in my own mind a way that private industry, in fairness to all, could accomplish this task, as much as I am a private enterpriser. I wish something like that might be done, because that is the way our economy operates, but I think of no alternative at this point but for the Government of the United States, through its Congress, to reconsider that law and appropriate the funds, this a hundred twenty, a hundred thirty, whatever sum of money, millions there may be, and acquire that land in Government ownership so the Department of Agriculture, Forest Service, if you please, or what other agency is appropriate, so that proper forest practices are followed, and you do avoid all the disastrous consequences of the existing law that we have described. I think of no other plan.

I don't want to see that forest resource gutted. I don't want to see the Indians' money thrown to the winds, and if I had an alternative to Government management in that forest I would be happy to submit it, but I do not.

Senator NEUBERGER. Well, I appreciate very much your making your statement here, Mr. Stephenson.

Mr. WOLF. Mr. Stephenson, have you seen the statement filed by the Weyerhaeuser Timber Co. this morning?

Mr. STEPHENSON. No. I just heard that one had been submitted.
Mr. WOLF. Would you care to have a copy and examine it and see
if that provides an alternative that you think is satisfactory?
Mr. STEPHENSON. I would.

Mr. WOLF. And submit your views later to the committee?
Mr. STEPHENSON. Yes.

Senator NEUBERGER. I don't think in fairness to Mr. Stephenson we should ask him to comment today on the proposal. He has not heard it in detail. That would not be fair to you, and if you would care to perhaps write to the committee some time before November 1, I know that Mr. Weyerhaeuser and his associates will be glad to make a copy of the statement available to you.