Hon. RICHARD L. NEUBERGER, PUCKETT & SCHERER, Klamath Falls, Oreg., January 30, 1958. United States Senate, Washington, D. C. DEAR SENATOR NEUBERGER: I have read all your bills and letters as I am very much interested as to how the Klamath Indian Reservation will be liquidated. I certainly give you people credit for trying to work out a solution to this problem. If the sale is made to individuals or companies I do not believe it is fair to put any restrictions on harvesting the timber, as such restrictions would rule out all small operators and would not be fair to the Indians, as their timber would bring far less money. I fully believe the right solution, in all fairness to our State and counties, would be to place the reservation under the Bureau of Land Management. As you know, they now have approximately 50 billion feet of timber in Oregon and are certainly capable and qualified to handle this reservation. Just how to go about this-I would like you to check with the Bureau of Land Management there. I feel this reservation should either be on our tax rolls or handled like our railroad timber is handled, as Klamath County is going to have the burden for a long, long time. Again I would like to mention that I am against Federal purchase if it is under the Forest Service. I would appreciate it if you would have the United States Forest Service send me a copy of their ruling or law that entitles them to use two log scale rules in the same State on pine and on fir, as in the last letter I received they failed to answer my question, and I believe it is unjust and unfair. It has been pointed out to me that it is their policy to use the long log rule on fir timber, but this is not the way it is. In some localities they use the long log rule for all species of timber. In other localities the short log rule is used on all species, and west of Klamath Falls the timber under our district is sold on a short log rule, but just across an imaginary line the long log rule is used. As you know, the scale rule is only an instrument that is used to determine the recovery of lumber from a log. I feel the same measurement should be standard, as the difference in the two rules will run as high as 20 percent. I thank you for your interest in the welfare of our State. Hon. RICHARD L. NEUBERGER, O. K. PUCKETT, Partner. BERKELEY, CALIF., January 27, 1958. Senate Office Building, Washington, D. C. DEAR SENATOR NEUBERGER: May I address you on the matter of disposal of the Klamath Indian Reservation forest and range lands. Hereinafter I shall propose a plan of Federal administration that may appeal to you as the author of a bill that provides for acquisition of these lands and their transfer to the national forest system. It applies only in the event Congress decides upon such a transfer instead of selling the lands to private companies. The Klamath forest lands, like all other Indian forest lands, have been managed by the Indian Service foresters on such a high plane of technical forestry skill and at such a low cost as to make that management unique. The forestry is excellent. On the Klamath alone, pioneer work was done on cutting practice that recognize insect susceptibility, fire and insect protection, the silvicultural use of fire, and others. The costs of forest management have been well under 20 percent of the gross receipts. Naturally, the public will ask: If the Klamath forest and range lands are transferred into the national forest system, will the forestry be any better and the costs as low? At present, national forests cost 5 times as much to administer and the forestry is no better, even though the problems of ownership are simpler. If Congress decides to purchase the Klamath forest and range lands and incorporate them into the national forest system, I propose that it create the Klamath area as a national forest distinct from all others in the system as to the business aspects. The Klamath Indian forest would be set up and managed just as though it were private property. The cost of the property would be set up for gradual amortization, as was done for the O. & C. forest lands. Instead of paying 25 percent of the gross receipts to the county in lieu of taxes, it would be taxed like any similar private property similarly situated. It would be operated to make a reasonable profit, which profit could be applied to reducing the national debt. It would remain solely a stumpage selling and managing agency, like existing national forests, i. e., it would not engage in lumbering operations. It should have to pay interest on moneys appropriated by Congress, which appropriations would be regarded as loans for operating capital. Any appropriations made by Congress for purposes other than those made for managing the land, forest, forage, recreation and watershed resources, and for research on local, or intra-Klamath management problems, would not be chargeable to the management costs, but each of the resources would be managed as a business with proper allocation of costs. A fair charge should be made for recreation uses, and a charge for the value of the water should be set up as a credit in a separate account. Books would be kept exactly as they would be kept in any well organized and managed private business with the usual array of accounts. Road planning, building, and maintenance would be similarly handled as if the property were privately owned. Such a setup would be, in effect, a "pilot plant" for showing or pointing out: 1. The problems that are peculiar to public administration and management and how they affect costs and income. 2. What the business aspects of sustained-yield management actually are. 3. Where the weak spots are that run up costs and how they can be strengthened. 4. What the reaction of the personnel would be. 5. What the reaction of the general public, particularly the stumpage buyers, would be (unreasonable local demands could be better countered when it is understood that the forest is not a philanthropic venture). 6. How forestry operations are influenced by market conditions, products variety, and cost-income relationships. 7. Whether or not a public property can be operated without a loss. Thus, this special national forest would be a most valuable yardstick for management and costs. I would hope that such a setup would prove that a public agency can do as well as a private agency in operating without loss, recognizing, of course, the usual ups and downs of business. This forest could eventually become a training ground for supervisorial personnel of other national forests. This alone should be profitable to the taxpayer. The United States is in actual timber business in a very big way. Except for the Indian forests and O. & C. forests the business has been in the red from the start. With an annual income of more than $100 million from national forest sales, there should certainly be something left over to apply on the national debt. Our record of having nothing left over is on credit to Congress, the Department of Agriculture, or the public. If you think this proposal has any merit I hope you will call it to the attention of those of your Oregon colleagues interested in Indian forest land disposal. Cordially, Hon. HATFIELD CHILSON, Undersecretary of Interior, EMANUEL FRITZ. TULELAKE IRRIGATION DISTRICT, Interior Building, Washington, D. C. DEAR MR. CHILSON: Attached is a letter we are dispatching to Senator Richard Neuberger with regard to the Klamath Indian Reservation termination program. As you note, we are in accordance with your recommendations, particularly insofar as you recommend that the timber resources should be sold to private ownership on a sustained-yield basis. We had previously testified similarly on S. 2047. We are concerned over the material which you included in the last full paragraph on page 2 of your letter of January 13 to Vice President Nixon. In the second sentence you have used the comparative word "most important" and we would appreciate knowing the comparison you have made of the land in Big Klamath Marsh, particularly to similar lands in Louisiana and Arkansas, and to areas such as Harney Lake and Goode Lake. If you have compared with other areas we would appreciate the factual basis of comparison. Also, in the third sentence you indicated that the nesting area is producing certain types of ducks. We would appreciate knowing your estimate of this production and the comparison with other areas of the basin or the flyway. Also, no reference is made to the recommendation in the United States Bird Refuge upper Klamath Basin report that this area should be a combination reservoir and wildlife refuge. Did the Department report consider this problem? We would appreciate knowing if there has been any report prepared by the Service on the use of this marsh as a Federal refuge and on its possible integration into the overall Klamath Basin refuge program. If such a report has been prepared, please furnish us a copy. Very truly yours, SAM ANDERSON, President. Senator RICHARD L. NEUBERGER, TULELAKE IRRIGATION DISTRICT, Senate Office Building, Washington, D. C. DEAR SENATOR: We appreciated receiving the material you sent us on S. 3051 on the Klamath Indian Reservation problem. We were pleased to note that this bill embraced the principles contained in our previous resolution by requesting that a positive effort should be made to place this timber in private ownership on a sustained yield basis. We are concerned that the limitation of this sustained yield operation to 75 years is only postponing the time for adverse effects upon the upper Klamath Basin watershed and believe that the sustained yield operation should be in perpetuity. We also disagree with the provision which would transfer the Big Klamath Marsh into a wildlife refuge particularly where the need for this development has not been demonstrated. We are writing a letter to the Department of the Interior on this point and would appreciate your considering their reply. We would appreciate your including the resolution which we passed on S. 2047 in any consideration of S. 3051. Very truly yours, Senator RICHARD L. NEUBERGER, SAM ANDERSON, President. THE AMERICAN FORESTRY ASSOCIATION, Chairman, Subcommittee on Indian Affairs, Senate Office Building, Washington, D. C. DEAR SENATOR NEUBERGER: Within a few days the Subcomittee on Indian Affairs will again tackle one of the most complex problems of governmental stewardship, i. e., how to terminate Federal supervision over the Klamath Indian Reservation in a manner that will simultaneously (1) protect Indian interests, (2) insure continued productivity of the forest, and (3) maintain the dependent economy. This subject has received the thoughtful attention of the American Forestry Association. On September 29, 1957, the association's board of directors recommended "that disposal of the timberlands in the Klamath Indian Reservation should be made under such conditions as will assure sustained forest production and maximum permanent contribution to the economy of the area, including the economy of the Indians themselves." The association is opposed to any disposal of the forest which would result in its liquidation and desolation. This concern for the future management of forest resources has been a basic tenet of the American Forestry Association since its inception in 1875. The association's board of directors will not meet again until February 24, 1958. They would be very pleased to receive a report that the Subcommittee on Indian Affairs, under your able guidance, has devised a just and sound solution. Very truly yours, KENNETH B. POMEROY, Chief Forester. KLAMATH INDIAN RESERVATION RESOLUTION Whereas, the directors of the American Forestry Association on September 29, 1957, at Madison, Wis., resolved "that the disposal of timber lands of the Klamath Indian Reservation should be made under such conditions as will assure sustained forest production and maximum permanent contribution to the economy of the area including the economy of the Indians themselves;" and Whereas the Department of the Interior has now submitted to Congress a proposal (S. 3051) which, if adopted, will assure the achievement of these objectives; and Whereas a very difficult, many-sided problem has been answered by the Department of the Interior's proposal: Now therefore be it Resolved, That the American Forestry Association endorse S. 3051. Hon. RICHARD L. NEUBERGER, United States Senate, Washington, D. C. THE FIRST NATIONAL BANK, Portland, Oreg., January 31, 1958. MY DEAR SENATOR: Please excuse my delay in answering your wire of January 17 and your letter of the same date. They came at a time when we were quite preoccupied with the annual stockholders meeting of the bank and the activities incident thereto. Only now am I beginning to catch up with some of my correspondence. It will not be possible for me to be present at the Senate committee hearing, which I regret very much. Your statement, that of Secretary of the Interior Seaton, and also S. 3051 have had my careful perusal. I've concluded not to make a further statement at this time. At the hearing conducted in Portland I said that if I could think of any way in which private enterprise could do the job of converting the timber stands belonging to the Klamath Indians, that would be preferable. Also that I could think of no other way than for the Federal Government to acquire the Indian forest lands. That is the purpose of your bill. Secretary Seaton's bill, which you introduced by request, takes another approach. I do not feel competent to make an intelligent statement concerning the Seaton bill. In order to form a considered opinion, participation in a discussion concerning the bill would be advisable. To take a position without the benefit of discussion with interested parties certainly would not reflect mature judgment on my part. It might be possible that at some later date, after further testimony has been submitted and an opportunity has been had to review it, I would be in a position to make such a statement. It is to be sincerely hoped that a way can be found to protect the Indians, the timber industry, and the State of Oregon. Sincerely yours, Hon. RICHARD L. NEUBERGER, Chairman, Subcommittee on Indian Affairs, C. B. STEPHENSON, President. THE BEND BULLETIN, Bend, Oreg., January 31, 1958. Senate Office Building, Washington, D. C. DEAR SENATOR NEUBERGER: I regret that it will be impossible for me to appear at the subcommittee hearings February 3 to 5 on S. 3051 and S. 2047. I would, however, like to express my opinion on S. 3051. The subcommittee already has my views on S. 2047, given at the Portland hearings. In my opinion, S. 3051 is an unrealistic attempt to answer the most serious economic and social problem to face the State of Oregon since it was admitted to the Union. The provision which calls for sale to private ownership is unrealistic in that it has mutually exclusive provisions. I believe that no private operator would be able to buy this timber under the terms outlined by the Secretary, and pay for it a price which would be fair to the Indians. There have been objections to the legal requirement of sustained-yield management provided for in this bill. I do not agree with these objections, as long as the buyer's responsibility is clearly outlined before he purchases. It is my personal belief that if S. 2047 can be passed and signed by the President it is a much better solution to this problem than S. 3051. Sincerely, ROBERT W. CHANDLER. [The Bend Bulletin, January 14, 1958] SEATON'S PROPOSAL Secretary of the Interior Fred Seaton has made his proposal for amending the Klamath Termination Act. Like some others, it is long on idealism and short on practicality. (Actually, we shouldn't call it the Seaton proposal. We wouldn't, except in the interests of brevity. It is an Interior Department proposal.) "The Secretary, in a message to House Speaker Sam Rayburn, recommended that forests on the Klamath Indian Reservation be acquired by the Federal Government, unless the forest can be sold to private purchasers who would agree to follow sustained-yield management. "Under present law, part of the forest must be sold to pay members who withdraw from the tribe. Under the amendment proposed by Seaton, that part of the forest would first be offered for sale on a competitive market at not less than its 'appraised realization value,' and purchasers would have to agree to sustained-yield management. "Seaton's proposal suggests that if the forest cannot be sold on this basis, then it would be purchased by the Federal Government for its appraised realization value and dedicated to use as a national forest." Perhaps the first part of the Interior suggestion-that the forest be sold on a competitive market at not less than its "appraised realization value" to private operators-is a sop to the free-enterprise-or-nothing crowd. It certainly is far from realistic. The tentative appraisal of the tribal forest is around $113 million. No one, we repeat, no one, is going to be able to pay that kind of price for the forest and operate on a sustained-yield basis. Any purchaser, before agreeing to operate on that basis, would want to discount the short-term value of the forest by 50 percent or more. Which, under the Interior proposal, would preclude private sale of any sort. Federal purchase, as suggested by Senator Neuberger and advocated by him for some time, is the only answer under the present law or under any suggested amendments which have been made public to date. The only other answer is a drastic amending of the Klamath Termination Act, an amending which would delay the effective date of the act for a period of from 10 to 15 years. If, as seems likely now, it will be impossible to get Congress to provide funds or authorize bonds for the purchase of the forest lands of the Klamath Reservation, the course mentioned above is the only one left. And this will come under fire from a minority of the Klamath Tribe, which seems to have been hoodwinked by some of its leaders. It will take from 10 to 15 years to provide for an orderly liquidation of the tribal assets-mostly timber-and teach enough members of the tribe to handle their assets wisely as to avoid one of the biggest Indian scandals in the Government's long history of mismanagement of Indian affairs. CAR-AD-CO COMPANY, Klamath Falls, Oreg., January 31, 1958. Senator RICHARD L. NEUBERGER, Senate Office Building, Washington, D. C. DEAR SENATOR NEUBERGER: We appreciate very much receiving the information sent in regard to the Klamath Termination Act, because it is certainly a problem close to our hearts. We recognize S. 3051 as somewhat of a compromise to certain elements of our industry and appreciate, at least, the recognition thus given. However, it is certainly not the answer. In our opinion, it is highly doubtful that private capital would desire to enter into such an agreement as offered in S. 3051. An investment of this magnitude, the long duration of the agreement and the inability of the private interest to recover or safeguard his investment, as he would deem necessary, do not make this proposal very appealing to private capital. Thus if there are no takers, S. 3051 provides for governmental ownership and, in essence, we are back to S. 2047. Our objection to S. 3051 is not that there may not be any private buyers, but to the fact that there may be some private buyers. The proposal offers large areas for sale (in the Secretary's letter, he noted 10 to 15 units) thus completely eliminating the small lumber producer for any consideration. Under Forest |