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REAL ESTATE 
 
 TO COMPLETE ACQUISITION IN CERTAIN CASES 
 
 HEARING 
 
 BEFORE A 
 
 SUBCOMMITTEE OF THE 
 COMMITTEE ON MILITARY AFFAIRS 
 
 HOUSE OF REPRESENTATIVES 
 
 SIXTY-SEVENTH C< INGRESS 
 FIRST SESSION 
 
 SUBCOMMITTEE 
 
 JOHN C. McKENZlE, Illinois, Chairman. 
 FRANK L. GREENE, Vermont. WILLIAM J. FIELDS, Kentucky. 
 
 W. FRANK JAMES, Michigan. HUBERT F. FISHER, Tennessee. 
 
 JOHN F. MILLER, Washington. 
 
 Howard F. Sedgwick, Clerk. 
 
 w 
 
 WASHINGTON 
 
 GOVERNMENT PRINTING OFFICE 
 
 1921 
 
LIBRARY OF CONGRESS 
 RECEIVED 
 
 NOV 1 9 192 
 
 DOCUMENTS DIVISION 
 

 INDEX TO WITNESSES. 
 
 Page. 
 
 Baetjer, Harry N 52-67 
 
 Brooks, Walter B 52-67 
 
 Bussche, Maj. C. F. von dem ll-14,25,27,29HU,42-43,65-€7 
 
 Carson, Brig. Gen. John M 3,14,20,22,26 29-41,51,56 
 
 Dallam, D. E 4-14 
 
 Fuller, Hon. Charles E 44-51 
 
 Gilmore, Col. W. E 14-29 
 
 Patterson, Hon. F. F., jr 41-42 
 
 Sutton, J. Howard 52 
 
 Williams. Col 18-24 
 
 1 
 
EEAL ESTATE. 
 
 House or Representatives, 
 Subcommittee or the Committee on Military Affairs, 
 
 Monday, May 23, 1921. 
 The subcommittee met at 10 o'clock a. m., Hon. John C. McKenzie 
 (chairman) presiding. 
 
 Mr. McKenzie. The hearing is on the bill H. E. 204, " To amend 
 the Army appropriation act, approved July 11, 1919, so as to relieve 
 appropriations for the completion of the acquisition of real estate in 
 certain cases and making additional appropriations therefor." 
 
 STATEMENT OF BRIG. GEN. JOHN M. CARSON, QUARTERMASTER 
 
 CORPS. 
 
 Brig. Gen. Carson. Mr. Chairman, the amounts asked for in this 
 bill (H. It. 204) are for the purpose of completing obligations incurred 
 by the War Department during the process of acquiring the real estate 
 upon which the various projects are located. In some instances the 
 property was under contract; in others it had been requisitioned at the 
 time of the passage of the act of July 11, 1919, which prevented any 
 further moneys being expended for the purchase of real estate by the 
 War Department. In all cases the War Department is definitely ob- 
 ligated for the amounts, and this bill in no way contemplates the pur- 
 chase of any additional real estate, but is solely based on the idea of 
 completing obligations already made and protecting the large invest- 
 ments on the various sites involved. 
 
 The power of requisition was conferred upon the President of the 
 United States by the act of Congress approved August 10, 1917 (40 
 Stat., 27G, 279). It has been held that the service of a requisition 
 vested fee-simple title to the real estate forthwith in the United States 
 and thereby obligated the United States to pay just compensation to 
 the owner for his property. The power of requisition Avas ultilized 
 only in cases where a price could not be agreed upon. The matter was 
 then heard by the War Department board of appraisers, sitting 
 somewhat in the nature of a court of claims and making an award 
 based on the evidence presented by both parties to the dispute. In 
 all cases of requisition such an award has been made, and it would 
 seem as though the United States was definitely obligated to make 
 payment. 
 
 This explains the necessity for the appropriations asked for in this 
 bill now before the committee. 
 
 3 
 
4 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 STATEMENT OF MR. D. E. DALLAM, 514 WALNUT STREET 
 PHILADELPHIA, PA. 
 
 Mr. McKexzie. Mr. Dallam, you have appeared before the com- 
 mittee at this time in relation to the item in the bill set out in line 14, 
 page 2, of the bill, "For Army supply base, Philadelphia, Pa., 
 $766,937." 
 
 Mr. Dallam. Yes, sir ; that is the money that we hope to get out of 
 that item. 
 
 Mr. McKexzie. We will be glad to hear what you have to say. 
 
 Mr. Dallam. I will try to make it very brief." In 1919 the Green 
 wich Real Estate Co., of which Mr. Burroughs is president, held about 
 143 or 144 acres of ground in one lot, practically at the foot of Ore- 
 gon Avenue, Philadelphia. I have been endeavoring to sell it, but 
 could not sell it except as one entirety, at $1,000,000. We understood 
 that the Government had been investigating it with other sites, and 
 I placed myself in communication with the Government. They very 
 politely told me that they were interested in it, and we had consid- 
 erable correspondence upon the subject. They were interested in it, 
 but they would not take it all, and they thought that it was of such 
 value that they should not buy it directty, but that they should con- 
 demn it. 
 
 Subsequently, in July, 1918, they took possession of the full tract, 
 practically, to put improvements upon the river front, and they asked 
 me for permission to use the balance of the ground at a rental. I 
 said, " Certainly, if you pay the taxes on it, j^ou can use it as long as 
 you want it." We then subsequently arranged for their propor- 
 tionate share of the taxes, our property having been assessed in a 
 lump. Their proportionate share of the taxes for 1918 was $800, and 
 they promised to send us that money. In the spring of 1919 they 
 said, ""As to this property west of Delaware Avenue which we have 
 rented from you, we have concluded to take it in fee." I said, "All 
 right," and they negotiated a price or they gave me a price. 
 
 Mr. McKexzie. Who negotiated with you? 
 
 Mr. Dallam. Here is the contract [indicating], 
 
 Mr. McKexzie. A representative of the War Department nego- 
 tiated with you ? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. Miller. Who were those representatives? 
 
 Mr. Dallam. That contract of sale shows for itself. 
 
 Mr. Miller. Does that contract show the names of the parties? 
 
 Mr. Dallam. Yes, sir. There was a long correspondence. The 
 first correspondence is signed by Gilbert F. Woods, chief of the Eeal 
 Estate Section, and the contract for sale is also signed by G. F. 
 Woods. 
 
 It is all in writing. They said that they would pay for it out of 
 the appropriation for 1919. They said that they had the money and 
 wanted the property. I said to them, " Put it in writing." There 
 were one or two contracts of sale sent to me which I declined to 
 accept. Finally we got one that was acceptable, which I signed. They 
 signed it on June 27, 1919. They said that I was to get the money on 
 June 30, but I did not get the money on June 30. I kept writing for 
 it, and finally on July 19, or some date subsequent to that, Congress 
 passed an act prohibiting the purchase of any more real estate. 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 5 
 
 Mr. McKenzie. Was that on July 19 ? 
 
 Mr. Dallam. It was sometime in Jury, and then everything was 
 entirely out. I went to Washington and said to them, " Give me my 
 contract back," and they said, " No, we will get a bill." They had 
 introduced a bill in Congress, but it was amended to death and finally 
 it was not passed. Then a bill was introduced in the last Congress 
 almost identical with it, but it was not reached. Now it is included 
 in this bill. I have gone to the headquarters, and I as very courte- 
 ously treated. I said to them. " If you gentlemen do not want this 
 land, give it back to me." They said, " We must have it for the 
 classification yard, and we hope that we will get a bill through." 
 
 Mr. McKenzie. Let me ask you a few questions. 
 
 Mr. Dallam. Let me say also, Mr. Chairman, that I have here the 
 contract covering the adjoining piece of property, belonging to the 
 Grove Oil Co., contracted for on the same terms, involving $4,500. 
 That is also included here. Here is their contract now [exhibiting 
 it], and it is in the same form as the other. They agree to pay for 
 that land $4,500, but we have never received the money for it and we 
 can not get the ground back. There are other people concerned, or 
 other adjoining property owners, but I only represent profession- 
 ally Mr. Burrough, or the Greenwich Real Estate Co. and the Grove 
 Oil Co. 
 
 Therefore, there are two contracts which I represent here, and in 
 regard to which I would like to have something done. One involves 
 $315,000, and that speaks for itself. It specifies interest and also 
 $800 for taxes for the preceding year, which we have paid. The 
 taxes for 1919, 1920, and 1921 are accumulating against the property, 
 which, necessarily, the Government ought to pay and which they will 
 have to pay if they take title as of July 19, according to the contract. 
 
 Mr. McKenzie. You have no claim now for that, have you? 
 
 Mr. Dallam. I have not said a word about the taxes, but if you 
 get the title we will not pay the taxes. 
 
 Mr. McKenzie. Let me ask you a few brief questions. These con- 
 tracts were entered into for the purchase of this property prior to 
 July 19, 1919? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. McKenzie. Or on July 11, 1919? 
 
 Mr. Dallam. Yes, sir; they were entered into in the spring, and 
 that one was finally signed on June 27. I had correspondence with 
 them during March, April, and May, and they had been in possession 
 since July, 1918. • 
 
 Mr. McKenzie. It was a complete contract of purchase? 
 
 Mr. Dallam. Yes, sir ; a complete contract of purchase. 
 
 Mr. McKenzie. For what amount of money? 
 
 Mr. Dallam. $315,000. 
 
 Mr. McKenzie. Now, then, their contention, as I understand it. is 
 that the limitations put on the appropriation bill of July 11, 1919, 
 the purpose of which was to prevent the purchase of any more real 
 estate, prevented the purchase of this property ; but, as I understand 
 it, this property had been purchased although it had not been paid 
 for. 
 
 Mr. Dallam. Yes, sir ; prior to that time. 
 
 Mr. McKenzie. Your claim here, however, is for $766,937. 
 
6 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Mr. Dallam. That covers a whole lot of things at Philadelphia. 
 I do not know what all of them are. 
 
 Mr. McKenzie. Your item in that total amount is $315,000? 
 
 Mr. Dallam. That is the only contract that I have in writing. 
 Now, I will go further, if you will allow me 
 
 Mr. McKenzie (interposing). What we want to get at is your 
 claim. Your claim for the sale of this property amounts to $315,000. 
 
 Mr. Dallam. $315,000; yes, sir; and $4,500 for the Grove Oil Co. 
 Those are the claims that I represent. 
 
 Mr. McKenzie. Have you any other claims ? 
 
 Mr. Dallam. We have a claim 
 
 Mr. McKenzie (interposing). In other words, we want to know 
 what this money is to be expended for. 
 
 Mr. Dallam. I do not know. Now. on this water-front property, 
 the Government has erected $11,000,000 piers, etc. Thev have spent 
 $11,000,000 there. The $315,000 contract covers a part of this up- 
 per tract, or west tract. 
 
 Mr. McKenzie. When you refer to the $315,000 transaction, was 
 that an absolute purchase? 
 
 Mr. Dallam. That is what we are claiming now. Now, you asked 
 me about the other. Under this, they had a board of appraisal 
 and took it under condemnation proceedings. That is in litigation 
 now. In connection with that litigation, they sent three gentle- 
 men there, as the Joint Board of Army Appraisers, and for prop- 
 erty upon which we paid taxes on the basis of a valuation of $550,000, 
 they awarded us $285,000. 
 
 Mr. McKenzie. That is another piece of property? 
 
 Mr. Dallam. That is property lying on the front. That is the 
 property that they took on condemnation. Now. the condemnation 
 act, under which they proceeded, requires that the President shall 
 tender to the owner 75 per cent of the award, and gives the owner 
 the right to sue for the balance. I do not attempt to deal with you 
 as a lawyer, because I am a real estate man : but the contention of 
 the Philadelphia courts has been that we have no rights and that 
 we can do nothing until that 75 per cent is paid, and as that has 
 not been offered to us, nothing has been done. As I understand it, 
 although I am only assuming this, that 75 per cent on our claim 
 and on other claims is to be paid out of the balance of this money 
 in order to put the claimants in a position to bring suit. 
 
 Mr. McKenzie. Are you willing to take the $285,000? 
 
 Mr. Dallam. No, sir; not at all nor under any circumstances. 
 
 Mr. McKenzie. You are not satisfied with the award? 
 
 Mr. Dallam. No, sir: and we are coming before this committee 
 for the purpose of getting sufficient to pay us this $315,000 and the 
 $4,500 on account of the property of the "Grove Oil Co. We want 
 either that, or to have our land given back to us. They have clone 
 nothing except to fill it in. One of the buildings may overlap it 
 to some extent. 
 
 Mr. McKenzie. You would be willing to have Congress pass a 
 law directing the War Department to turn back to vou the land 
 covered by the claim of $315,000 and the claim of $4,500? 
 
 Mr. Dallam. It depends on what they turn back to us. Our con- 
 tention has always been that this property should be used as an en- 
 tirety—that is, the property west of the Avenue. As to the property 
 
REAL ESTATE — TO COMPLETE ACQUISITION TX CERTAIN CASES. 7 
 
 east of the Avenue, because of this litigation, they have given us or 
 offered us $285,000, and the city has assessed it for taxation at 
 $550,000, and a jury can settle that. As to the property west of the 
 Avenue, we contend that it should be used as one property. They 
 have gone on the property there, and have closed streets that had 
 been opened since 1792, and they have erected on a part of it some 
 improvements. I do not care for those improvements at all, and if 
 they are to give us back our property, we want all of it back. Other- 
 wise, I would say let us go out and say what of that property we 
 will sell to the Government. The property is assessed in various 
 amounts, aggregating on the property for which they agreed to pay 
 $315,000, the sum of $275,000. 
 
 Mr. McKenzie. I want to get this thing clear in my mind : Would 
 you be willing for the War Department to cancel its claims to all 
 the lands— not only those lands under contract for $315,000, but all 
 of it — and dismiss the condemnation proceeding and permit you to 
 step right in and take possession of the real estate that you owned 
 prior to any of those actions being taken? Would you be satisfied 
 with that? 
 
 Mr. Dallam. Yes, sir; but you have spent $11,000,000 in improve- 
 ments, and we do not want your property. I do not want what you 
 spent there, and you have spent $11,000,000 on it. This plat [indi- 
 cating] will show the situation. I went to them and said, " Let us 
 give you this land back | indicating] you say that you are boss, with 
 nobody over you except the Secretary of War." I said to them, 
 " Give us back this property." This property is under condemnation 
 proceeding, and we are being assessed for taxes on it upon the basis 
 of $550,000, and. of course, Ave will not take $285,000 for it. We will 
 have a jury to pass upon that. Now. you have spent $11,000,000 on 
 this property [indicating], and yon will not give it up. These are 
 terminal warehouses [indicating] and this [indicating] is the classi- 
 fication yard, which has simply been filled in. You have erected a 
 power house at this corner [indicating]. 
 
 Mr. McKenzie. If the Government should retain this property 
 [indicating], they would have to retain this [indicating]. 
 
 Mr. Dallam. Yes. sir; that is what some people tell us. Of course, 
 that is a technical question. This [indicating] is the property of the 
 Grove Oil Co., and beyond this, to League Island, there is nothing 
 but the Grand Union Freight Yard of all the railroad companies. 
 There are no improvements south of here [indicating]. There are 
 three manufacturing plants in here [indicating]. The Pennsylvania 
 Railroad Co. owns this property [indicating]. There is nothing here 
 until you strike the Greenwich Real Estate Co.'s tract. That [indi- 
 cating] is the property you took from us. Everything else was 
 filled up. and we have been holding this tract as an entirety since 
 1855. We have paid the city $285,000 in taxes alone on this property. 
 What we want you to do, and I think Mr. Burroughs will agree to 
 that, is simply to give us the $315,000, and then we will settle the 
 other by due process of law whenever that occurs and wherever it 
 occurs. It will be in a United States court, and you will get justice 
 as well as we. As I have said, we are assessed for taxation on that 
 property on the basis of $550,000. and we most pertainly will not 
 take $285,000 for it. 
 
8 REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 
 
 Mr. McKenzie. Of course, we are not trying the condemnation 
 suit. 
 
 Mr. Dallam. No, sir; that will be tried in court. 
 
 Mr. McKenzie. This item of $706,000 covers the condemnation 
 proceeding ? 
 
 Mr. Dallam. Yes, sir; the whole proceeding. There are other 
 properties involved. 
 
 Mr. McKenzie. I presume it would not be impertinent to ask what 
 the property cost you. 
 
 Mr. Dallam. I do not know. T was here in 1S55, but I was not of 
 an age to take care of this. This whole property was originally 
 bought by people connected with the Pennsylvania Railroad Co. 
 They sold to the Pennsylvania Railroad Co. a sufficient amount of it 
 for their coal docks, then they sold to another Pennsylvania cor- 
 poration, or the Pennsylvania Salt Co., sufficient land for their 
 purposes. The balance of it has been lying here idle. What it cost, 
 I do not know, but I know that we have paid that amount of taxes 
 upon it. We have nothing but rich men behind it, and every year 
 we have paid an Irishman's dividend and of necessity have paid the 
 taxes. We will not get back what we have paid on it in the way of 
 taxes and interest if we get $1,000,000, as it is appraised. 
 
 Mr. McKenzie. When the Government took possession of it, it 
 was vacant land, and it was held by you gentlemen with a view 
 to 
 
 Mr. Dallam (interposing). With a view to using it for large 
 plants, like the manufacturing plants that are located alongside it. 
 
 Mr. McKenzie. And you placed a rather high valuation upon it? 
 
 Mr. Dallam. No, sir ; we did not do that, but the city put the valua- 
 tion on it. We did not want to pay any more taxes than was 
 necessary. 
 
 Mr. McKenzie. You thought that it was so located that it was 
 valuable? 
 
 Mr. Dallam. Undoubtedly. 
 
 Mr. McKenzie. And that some time, sooner or later, you could sell 
 it to advantage? 
 
 Mr. Dallam. It is the only property there that is not improved, 
 and that is the reason the Government bought it. 
 
 Mr. McKenzie. You want it settled up in some way ? 
 
 Mr. Dallam. In some way, for mercy's sake. 
 
 Mr. Miller. You represent the Grove Oil Co.'s tract? 
 
 Mr. Dallam. Yes, sir; the Grove Oil Co.'s tract adjoining this. 
 
 Mr. Miller. How many acres are involved in this? The tracts 
 appear to contain 69 and a fraction acres and 6 and a fraction acres. 
 
 Mr. Dallam. Yes, sir ; that is what those two tracts contain. 
 
 Mr. Miller. There are 69.959 acres in one tract? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. Miller. And 6 and a fraction acres in the other? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. Miller. The entire property consisting of 75 and a fraction 
 acres? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. Miller. What do you know about the Grove Oil Co. tract ? 
 
 Mr. Dallam. That is another tract of adjoining property. 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 9 
 
 Mr. Miller. This tract of 75 and a fraction acres is all involved in 
 that contract of June 27, 1919? 
 
 Mr. Dallam. Yes, sir; in that sum of $315,000. 
 
 Mr. Miller. This 75 and a fraction acres is what vou offered them 
 under this contract for $315,000? 
 
 Mr. Dallam. Yes, sir; the whole thing as an entirety. This prop- 
 erty comes from here [indicating] to Swanson Street. Here is prop- 
 erty owned by the Pennsylvania Railroad Co. [indicating], and there 
 I indicating] on the other side is property of the Baltimore & Ohio 
 1'ailroad. This property is worth more than property over here 
 [indicating] with no railroad connection, and, as you will see, it 
 .should be sold as one title and used for manufacturing purposes. 
 We have never offered this property except as an entirety. 
 
 Mr. Miller. You maintain that the Government owes you $315,000 
 for this 75 and a fraction acres ? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. Miller. And you say that the contract covering this 75 and a 
 fraction acres of land was orally entered into? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. Miller. When was it orally entered into? 
 
 Mr. Dallam. It was orallv entered into probably in March. 
 
 Mr. Miller. March, 1919'? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. Miller. Now, you say that after that oral contract was entered 
 into, the Government was to pay the taxes? 
 
 Mr. Dallam. They were to pay the taxes before that. They took 
 possession the year before. 
 
 Mr. Miller.' That would be about $800 a year? 
 
 Mr. Dallam. No, sir ; not at all. 
 
 Mr. Miller. I thought you said it amounted to $800 a year. 
 
 Mr. Dallam. We had paid our taxes for 1918 before the Govern- 
 ment came over there, and we apportioned the taxes covering this 76 
 acres. We had 150 acres and we agreed upon that apportionment. 
 It was a perfectly fair apportionment, and it was agreed that $800 
 represented their share of the taxes assessed on that property in 1918. 
 They agreed to that. 
 
 Mr. Miller. Their proportion of the taxes on that 75-acre tract for 
 1918 was $800? 
 
 Mr. Dallam. Yes, sir ; for the balance of 1918. Here is the contract 
 of March, 1918. This reads, "The offer in the foregoing letter is 
 hereby accepted." That was signed by G. F. Woods. They never 
 signed the contract until June 27. That [indicating] is the letter from 
 the president of the company, and I signed it. 
 
 Mr. McKenzie. The contract you have just been discussing with 
 Mr. Miller involves the $315,000? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. McKenzie. The other contract which you have there, of which 
 the purchase price is $4,500, involves about one-half acre of land? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. McKenzie. And in the condemnation proceedings for £he other 
 tract, the board of appraisers fixed the valuation at $285,000? 
 
 Mr. Dallam. Yes, sir. 
 
 Mr. McKenzie. What do you want for that property, or what is 
 your idea in regard to that ? 
 
10 REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN. CASES. 
 
 Mr. Dallam. We asked for that property $650,000. 
 
 Mr. McKenzie. You want $650,000 instead of $285,000? 
 
 Mr. Dallam. Yes, sir. We had a tract of land containing 144 
 acres of which we gave them the refusal. That property was held 
 at $1,000,000. They took us up on our proffer. That was done by 
 some people who were endeavoring to finance the Government, and 
 that option expired. Then, when the Government said to me, "We 
 only want the front." Ave went over the valuation T went to the 
 Board of Tax Regents, and said, "You have this property assessed. 
 and the Government only wants the front. What is the front worth 
 as compared with the back?" They estimated that two-thirds of 
 the assessment was on the front property, and that made it $650,000 
 for the front and $350,000 for the back property, upon the basis of 
 the valuation of $1,000,000. That made up the $1,000,000. When 
 the Government came to buy this seventy-odd acres here [indicating], 
 they said, "We will take it acre for acre on the basis of $350,000," 
 but we would not do that, because they would be cutting us off from 
 the front. They were taking three-fourths of it. and we said that it 
 was worth at least 90 per cent of the gross amount, and they accepted 
 it. That is the reason they gave us 90 per cent of the amount, or 90 
 per cent of $350,000. I could get people to swear to-day that it is 
 worth 50 cents per foot. 
 
 What Ave want to do is to get rid of it. We want the $315,000, and 
 are willing for the other matter to take care of itself. Let me shoAv 
 you the map that they served on us in the matter [indicating]. Here 
 [indicating] is the property to be acquired by the United States 
 Government. The property that they bought from us at $315,000 is 
 the property indicated in red. We own the property Avest of this 
 [indicating]. This little $4,500 tract is in here [indicating] and 
 this [indicating] belongs to the New York Agricultural Co. They 
 also took this property of the Pennsylvania Salt Co. They agreed 
 to giA'e us $315,000. just what Ave asked. They could not get it any 
 cheaper, and they knew it. I do not hesitate to say that if Ave could 
 put a jury on it, we could get more. We gave them that price the 
 year before, or in January and February, and Ave could not get a 
 contract in writing until June. There Avas a whole lot of correspond- 
 ence, but what Avas the use of that? 
 
 Mr. McKenzie.. Going back to your ansAver, I do not think that 
 I understand you fully : Do you mean to say that you wanted 
 $650,000 for the tract that is under condemnation? 
 
 Mr. Dallam. Yes, sir: it Avas assessed at $550,000. 
 
 Mr. McKenzie. That would make $650,000— $315,000 and $4,500? 
 
 Mr. Dallam. The $4,500 is another matter. That is the Grove 
 Oil Co. matter. 
 
 Mr. McKenzie. But it is included in this bill. 
 
 Mr. Dallam. Yes. sir; I assume that it is. We asked $350,000 for 
 that property, but they said they did not Avant to take all of it. What 
 they took represented 90 per cent of it in value, and so they gaA~e us 
 $315,000. 
 
 Mr. McKenzie. Do you think that a jury in Philadelphia would 
 give you $650,000 for the tract involved in the proceeding that is iioav 
 pending in court ? 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 11 
 
 Mr. Dallam. I mean to say unhesitatingly that I could get people 
 in there to testify that, and they would say they would give $50,000 
 more for it. 
 
 Mr. McKenzie. On this particular tract, improvements have been 
 made ? 
 
 Mr. Dallam. You have spent, supposedly, $11,000,000, and you 
 have got to keep it. 
 
 Mr. McKenzie. That all depends upon circumstances, or upon 
 whether we have a need for it. 
 
 Mr. Dallam. There has been an expenditure of $11,000,000 made 
 upon this property. 
 
 Mr. McKenzie. I think that is all. While you are here, I will be 
 glad to have the officer of the Army make his statement right in con- 
 nection with yours in regard to this particular property. 
 
 STATEMENTS OF BRIG. GEN. J. M. CARSON, OFFICE OF THE QUAR- 
 TERMASTER GENERAL, AND MAJ. C. F. VON DEM BUSSCHE. 
 
 Maj. von dem Bussche. The whole project covers a total of 119.9 
 acres, which was requisitioned in July, 1918, and upon which no pay- 
 ments have been made. The improvements consist of three concrete 
 piers, A, B, and C. Pier A is an open pier for the docking of vessels. 
 Pier B is 1,500 feet long and 290 feet wide, upon which is erected a 
 3-story reinforced concrete and brick pier shed, consisting of two 
 wings, 96 and 102 feet long, respectively, separated by a court 46 feet 
 wide, with a total floor area of 892,250 square feet gross. Pier C is an 
 open shed, 1,320 feet long and 290 feet wide. The total gross area of 
 open space on the piers is 578,600 square feet. There are two tracts 
 of land at this place, one of which, comprising 88 acres, is under con- 
 tract of purchase at the price of $380,870.50. The assessed valuation 
 of this tract as of July, 1918, is $75,404.15, which purports to repre- 
 sent 70 per cent of the real value of the land. The other tract, com- 
 prising about 31 acres, was requisitioned, and awards to the amount 
 of $315,410.90 were made by the War Department's board of ap- 
 praisers, together with interest at the rate of 5 per cent from March 
 11, 1919. Taking into consideration the interest and the fact that the 
 owners of the requisitioned properties have instituted suit, it is esti- 
 mated that the amount required will be approximately $766,937. The 
 project was approved by the Secretary of War on June 28, 1918. 
 
 Mr. McKenzie. That is the amount shown in the bill? 
 
 Maj. von dem Bussche. Yes, sir. I might say that so far as Mr. 
 Dallam's statement of the facts is concerned very careful estimates of 
 the value of that property were made. We had experts to visit and 
 value it, and the price offered Mr. Dallam was based upon the expert 
 advice of local Philadelphia real estate men. Those gentlemen are 
 no longer in the service, or the gentlemen who made the survey at 
 that time are no longer in the service, but they are available as wit- 
 nesses in connection with the condemnation proceeding. 
 
 Mr. McKenzie. As I understand it, Mr. Dallam is satisfied to 
 accept payment under the terms of the contract for the land covered 
 by this particular contract, and that he will await the pleasure of the 
 court in fixing the value of the remainder of the property. Now, if 
 we should make this appropriation of $766,000 and the jury should 
 
12 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 find that you have made too low a valuation, I presume that the only 
 remedy would be by a deficiency. I imagine that it would require a 
 deficiency to cover-it. 
 
 Mr. Dallam. I do not want to go to the Court of Claims. 
 
 Maj. von dem Bussche. The valuation of the property has been 
 held to be as of the date of taking, without regard to the improve- 
 ments placed thereon by the United States. It has been held in most 
 condemnations that the valuation shall be as of the date of the taking 
 of the property by the United States. In this case it will be the 
 valuation of July, 1918. 
 
 Mr. Dallam. That is the law of Pennsylvania. 
 
 Mr. Greene. How far does the war situation itself enter into the 
 making of that valuation? In other words, the Army may have 
 gone upon a strip of unoccupied land that in ordinary peace times 
 might have gone for 20 years longer without having any particular 
 demand for it. 
 
 Maj. von dem Bussche. That is true. 
 
 Mr. Greene. Does the war-time demand enter as a part of the 
 valuation, or is that considered in fixing the valuation? 
 
 Maj. von dem Bussche. There can be no question but that the 
 placing of such activities as we had at Philadelphia did greatly 
 increase the value of the property all around. 
 
 Air. Greene. What I mean is this: When 3 r ou first wanted to enter 
 upon it, or undertook to buy it. did the price of the land increase 
 because there was a war in progress and because it was valuable by 
 reason of certain war activities? 
 
 Maj. von dem Bussche. Undoubtedly it increased in value because 
 the Government wanted it. That is a thing that we meet with every- 
 where. Wherever the United States desires to purchase property 
 the value of it immediately increases all the way from 100 per cent 
 to 1,000 per cent. 
 
 Mr. Greene. This may be more a question of ethics than of legis- 
 lative policy, but the question is whether the Government is justified 
 in going into a market and meeting its own competition there. 
 
 Maj. von dem Bussche. In all of these purchases the department 
 endeavors to secure an estimate from people conversant with values 
 in the particular locality. This figure, which is assumed to represent 
 the fair market value of the property, is a basis upon which the 
 purchase is made, providing the owners are fair and willing to accept 
 such appraisal. 
 
 Mr. Greene. This is the unfortunate situation: We know that 
 property may be lying idle and unimproved and held for speculative 
 purposes, and then suddenly, because of the necessity of using the 
 property for Government purposes, it takes on an artificial value. 
 That is frequently the case where the property must be taken for 
 some war use. 
 
 Maj. von dem Bussche. I might say to you that experience in con- 
 demnation cases already completed show that juries almost invariably 
 have awarded the appraised value of the property. I recollect that 
 in a case at Ancon, Ohio, the property owner held out for $600 per 
 acre. We had the appraisal made by the local real estate board of 
 Cincinnati, and their figure was $290 per acre. The award of the 
 jury was $290 per acre. We had a similar case at Grand Eapids. 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 13 
 
 One of the property OAvners at the picric-acid plant held out for, I 
 think, $192 per acre. The appraised value of the particular tract 
 made by the local real estate people was $10 per acre, and the award 
 was $40 per acre. 
 
 Mr. Greene. How did those figures compare with the figures of the 
 same local real estate people a few months before the war ? 
 
 Maj. von dem Bussche. They were based on that. They were 
 based absolutely on sales as far back as three years previous to that 
 time. Of course, neither side could present in evidence what the 
 Government had paid for real estate, but Ave considered prices paid 
 for real estate during the past five years, and from that the value of 
 the particular piece of property was determined. It was upon the 
 basis of those valuations that the estimates were made. Then, in 
 order to safeguard it and to eliminate any criticism, the department 
 invariably asked the local real estate board to give its opinion as to 
 the values. 
 
 Mr. McKenzie. We are much obliged to you. 
 
 Mr. Dallam. I am in that position, and I catch what the gentle- 
 man has said. I am probably the nestor of the real estate business in 
 Philadelphia. I have been engaged in it for 50 years, and I have 
 been a member of boards making real estate appraisals. They do 
 not want to call me into those appraisals, because I am too old- 
 fashioned, or too low. At the time the Government came in there, it 
 was the only property that they could get. I have sold everything 
 that has been sold in there, and I sold property to the Pennsylvania 
 Salt Co., at $16,000 per acre, just three years ago. The Government 
 can take a part of that land as it is to-day and sell it for $10,000 per 
 acre, and they are paying me less than $6,000 per acre. 
 
 Mr. Greene. If anybody had undertaken to sell Mount Arrarat at 
 a certain time, he could have gotten a very good price for it. 
 
 Mr. Dallam. The best expression I have heard of that was the 
 other day. The city is taking over a block of ground on which to 
 build a library. They asked me what it was worth, and I said $1,000 
 per foot. The first question they asked the owner was what did he 
 pay for the ground, and he said, " It does not make any difference 
 what I paid for it. If I had been around here I could have bought the 
 whole town from William Penn for $250." Now, as I have said, we 
 do not object to the condemnation. We are willing to go before a 
 jury on that. The only point is to differentiate between the price in 
 1918 and now. The last sale in 1918 was at about $500 per acre. 
 
 Mr. Greene. What is the practice in Philadelphia in regard to the 
 tax assessment valuations? Do j^ou have a recognized scale? In 
 other words, do you increase the land valuation, or do you increase 
 the tax rate ? 
 
 Mr. Dallam. They do both. The law provides that they shall 
 assess each piece of property on the basis of what it would sell for 
 singly and alone for cash after due notice. That is the wording of 
 the act. / 
 
 Mr. Greene. How far would you take the figures of the tax valua- 
 tion as indicating the true value of the land ? 
 
 Mr. Dallam. They assume that it is about 75 or 80 per cent of the 
 sale value of the land. 
 
 Mr. Miller. What Government activities will be carried on at this 
 place if the purchase should be completed ? 
 
14 REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 
 
 Gen. Carson. The Army Base at Philadelphia is used as a storage 
 base and as a shipping point for Government supplies. 
 
 Mr. Miller. Is there any similar Army activity in that neigh- 
 borhood ? 
 
 Gen. Carson, No nearer than New York. 
 
 Mr. Miller. Are there any to the south ? 
 
 (Ten. Carson. Yes, sir; at Norfolk. 
 
 Mr. Miller. You have one at Philadelphia, one at New York, and 
 one at Norfolk? 
 
 Gen. ('arson. Yes, sir. There are two others. There is one at 
 Charleston and another at Boston. 
 
 Mr. Miller. That would make five Army activities of a similar 
 character, or this one and four others? 
 
 Gen. Carson. Yes, sir. 
 
 Mr. Miller. They are in daily use now ? 
 
 Gen. Carson. Yes, sir. 
 
 STATEMENT OF COL. W. E. GILLMORE, CHIEF OF SUPPLY, AIR 
 
 SERVICE. 
 
 Gen. Carson. Col. Gillmore is here from the Air Service, and he 
 will speak especially of one item in the bill, on page 3, for the ord- 
 nance storage depot, at Middletown, Pa., $50,000. 
 
 Mr. McKenzie. We have heard something about that, and we 
 would like to have a brief statement in regard to it. 
 
 Col. Gillmore. A brief statement of the present status at Middle- 
 town ordnance depot is that in January, 1918, the Ordnance De- 
 partment leased approximately 396 acres of land. That is the tract 
 of land shown in here [indicating]. 
 
 Mr. Miller. Where is Middletown? 
 
 Col. Gillmore. Middletown is just below Harrisburg, Pa. 
 
 Mr. Miller. The tract contains 396 acres? 
 
 Col. Gillmore. Yes. sir. This tract was originally rented at the 
 price of approximately $100 per acre per year. Now, Mr. Chairman, 
 I woidd like to make this clear, that this was an Ordnance Depart- 
 ment transaction, and not a transaction of the Air Service. I can 
 tell you later why the Air Service is interested in it. They took 396.6 
 acres on lease, and that lease has never been canceled, to the best of 
 my knowledge. In August, 1918, suit was entered for the requisition- 
 ing of 82 acres, on which they built their big ordnance storage plant. 
 There was an award made by the War Department board of ap- 
 praisers of approximately $39,000 for the 82 acres. The Harrisburg 
 Real Estate Co. refused to accept the award, and therefore there has 
 not been any payment made on account of it. It is in the status now 
 of a contested award. 
 
 Mr. McKenzie. Did this Harrisburg Real Estate Co. own the 
 land, or did they lease it from the original owners? 
 
 Col. Gillmore. I think the Harrisburg Real Estate Co. owned the 
 land. 
 
 Mr. Miller. How long had they owned it ( 
 
 Col. Gillmore. Since 1915. The Ordnance Department's build- 
 ings on this section of land, or the buildings and improvements, cost 
 $1,325,000. Those are the buildings shown on here [indicating]. 
 
REAL, ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 15 
 
 These two large buildings are of hollow-tile construction, or a little 
 better construction than the ordinary temporary buildings. The Air 
 Service built a depot at Micldletown, and that is shown over here 
 [indicating]. 
 
 Mr. McKenzie. When did they build it ? 
 
 Col. Gillmore. That was built in 1918 also. We put in a pipe line 
 across there [indicating] and a power line from the Ordnance De- 
 partment here [indicating]. When the Ordnance Department, a 
 little over a year ago, said that this property, so far as they were 
 concerned, was surplus, the Air Service became interested in it for 
 this reason : We wanted to concentrate ; we wanted to give up our 
 establishment at Morrison, Va., the depot at Richmond, Va., and the 
 one on Long Island and concentrate here at Middletown. In the 
 first place, it is a wonderfully strategic location. It is back from the 
 seaboard, where we would not be likely to be hit early. 
 
 The railroad facilities are splendid, and 3*011 can see from the 
 topography that it is about the only piece of level land in that vicin- 
 ity. We already have a splendid supply depot and storage depot 
 there, and we wanted to combine with it a repair depot. These 
 buildings lend themselves to that kind of work very well without 
 anything but the very nominal cost of converting it into a repair 
 shop by the installation of machinery that we already have. 
 
 Mr. Miller. When did it cease to be used bj T the Ordnance Depart- 
 ment? 
 
 Col. Gillmore. The Ordnance Department is gradually getting 
 their supplies out of there. 
 
 Mr. Miller. It would be available for your use ? 
 
 Col. Gillmore. Yes, sir; it would be available. It struck me that 
 it was a wonderfully economical proposition for the Government, 
 and, following the tendency of Congress to concentrate such impor- 
 tant activities, we thought that this was a very fine solution of the 
 supply problem and repair problem of our service for the whole 
 eastern and northeastern part of the country, or from Maine down 
 to the Virginia capes. 
 
 Mr. McKenzie. Why would you undertake to develop a repair 
 station at this place instead of having your repairing done at the 
 flying fields? 
 
 Col. Gillmore. The difficulty in trying to have repairs clone at 
 the flying fields is this, that you do not have good mechanics to do 
 the repairing with 
 
 Mr. McKenzie (interposing). You could get them there, could 
 you not? 
 
 Col. Gillmore. You might get them there, but you would have 
 to scatter them. 
 
 Mr. Miller. You would have to provide housing facilities. 
 
 Col. Gillmore. No, sir ; I do not mean housing facilities, but you 
 will not get the production program through so far as the major 
 repairs are concerned. 
 
 Mr. McKenzie. For instance, take Boiling Field, and you have 
 a great many airplanes down there. Now, would it be your purpose 
 to ship those airplanes to Middletown, Pa. ? 
 
 Col. Gillmore. If it were a major repair; yes, sir. If the motor 
 had been in the air for 150 hours, and where it was not a question of 
 50916—21 2 
 
16 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 minor repairs, but where the motor would have to be taken down, 
 you would ship it into a place where you had mechanics who could 
 do the major overhaul work. The same thing is true with respect 
 to repairs to the fuselage and wings. 
 
 Mr. McKenzie. I can not understand the economy in that sort of 
 program. We have the same problem in connection with trucks 
 and automobiles. The best place in the world for making repairs 
 to trucks and automobiles is at the military post, and it seems to me 
 if there is any place in the world where you want mechanics to over- 
 haul flying machines it is at the flying field. 
 
 Gen. Carson. If they had buildings available for repair shops 
 at the flying fields, but they have not 
 
 Mr. McKenzie (interposing). It would not cost much to put up 
 such buildings as those. 
 
 Mr. Greene. If you put in at each flying field the necessary repair 
 installation and the force with which to make major repairs you 
 would have a great many more men in the total than you would 
 have if the work were centralized at one point. 
 
 Col. Gillmore. Yes, sir. 
 
 Mr. Greene. You would have the problem of making the neces- 
 sary installations and employing the necessary expert labor at each 
 flying field. 
 
 Col. Gillmore. Yes, sir. 
 
 Mr. Greene. Under this plan of consolidation, how many repair 
 shops would you have ? 
 
 Col. Gillmore. Three. 
 
 Mr. Greene. Located near the flying fields? 
 
 Col. Gillmore. In the big flying areas — that is, one in the East, one 
 in Texas, one in Alabama, and one on the western coast. 
 
 Mr. Greene. Located near industrial centers? 
 
 Col. Gillmore. The one on the western coast is temporary. We are 
 using the flying field there. 
 
 Mr. Greene. Are they located near industrial plants, where the 
 labor situation is easy? 
 
 Col. Gillmore. Yes, sir ; the one in Alabama is in the city of Mont- 
 gomery, and the one in Texas is at San Antonio. 
 
 Mr. Greene. If you should install plants for making major repairs 
 at the flying fields, would not that require some considerable outlay 
 for the machinery and other equipment necessary in making such 
 repairs ? 
 
 Col. Gillmore. Yes, sir. 
 
 Mr. Greene. There would be an overhead expense at every field? 
 There would be a saving in the overhead expenses if the repairs were 
 done at a centralized place rather than having them scattered all 
 around ? 
 
 Col. Gillmore. Yes, sir; you might consider that in comparison 
 with the repairs shops of railroad companies. You would not have 
 them to set up repairs shops at every point. 
 
 Mr. Greene. Do you find that the cost of transporting the planes 
 from the flying fields, where the disabilities occur, to the consolidated 
 or centralized repair shop is less than the expense of having them 
 repaired at the flying fields or the additional expense that would be 
 involved in having them repaired at the flying fields ? 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 17 
 
 Col. Gillmore. Yes, sir. 
 
 Mr. Greene, It would be cheaper to ship them to the central shop ? 
 
 Col. Gillmore. Considering the concentration of the civilian per- 
 sonnel, we find it cheaper. We can do this major overhaul work 
 cheaper in that way. That is also due to the fact that we take out 
 of the supply depot the material or a great deal of the material that 
 is used in making the repairs. When we ship a new plane into a 
 field to replace a wreck, for instance, then the major overhaul work 
 comes into the repair depot. When we have the two together, as at 
 Fairfield and at Montgomery, it is cheaper to ship it than to have 
 the personnel at each one of the flying fields. 
 
 Mr. Greene. There seems to be an important factor there to be 
 determined. That is to say, it is cheaper to concentrate the sup- 
 plies at three permanent major repair shops than to disperse those 
 supplies over all the flying areas ? 
 
 Col. Gillmore. Yes, sir. There is another thing that enters into 
 it, which is a very major item, and that is that our plane equipment 
 in storage deteriorates. A great deal of it we have to ship out for 
 replacements, but it is not safe to ship it out after it has been in 
 storage for a year or a year and a half without having it to go to the 
 repair shop. That is true even where the material has not been 
 used. Equipment that was manufactured in 1919 must go into the 
 repair shop before being issued. 
 
 Mr. McKenzie. I may be a little bit old-fashioned, but I have 
 not been able to understand the economic logic or philosophy of a 
 great business concern scattering its activities all over creation, in- 
 stead of centralizing them. Therefore, I can not see the point you 
 make in using the railroads as a parallel case to this, because the 
 railroad has its shops, and especially its repair shops, right on its 
 line, at the end of the division, where the engines must go. They 
 naturally go into those division shops, and there they repair them 
 and put them back in service. Now, in this case, whether it is a 
 truck or a flying machine, they will take it away from the field of 
 its activity or use, and ship it hundreds of miles across the country 
 to some place that has no other activity except that of repairing the 
 machines. Then it would be shipped back again to the place where 
 it is to be used. If that is economy, or if you can do that for less 
 money than you could have it repaired at the place where it is used, 
 then I have the wrong view of it. 
 
 Mr. Miller. I can see your criticism, but suppose the locomotive 
 gets out of repair at the other end of the line. In that case, you 
 ship it back to the repair shop, and you do not repair it on the 
 ground where the breakdown occurs. 
 
 Mr. McKenzie. If a flying machine goes down in the field, you 
 would have to get it back to its home base. 
 
 Mr. Greene. The question involves all of the factors that enter 
 into the question of consolidation and concentration. One is the 
 overhead expense which has to be provided at each place, and there 
 will be a certain percentage of duplication of plants all over the 
 country. There is the money that you have invested in the installa- 
 tions in order to make repairs at the local flying fields, and much 
 of the time the plant would be lying idle. When you come to bal- 
 
18 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 ance it up in a bookkeeping way, I think you will find that the con- 
 centration plan is cheaper. 
 
 Mr. McKenzie. It seems to me that the same principle underlies 
 the whole thing. Suppose in the old days a mule lost his shoe, and 
 you could not shoe him at the place where he was used, but had to 
 ship him several miles to a horseshoeing establishment. 
 
 Col. Gillmore. Have you differentiated there between minor re- 
 pairs and major repairs? Now, major repairs to a wing, means 
 tearing the fabric off, putting in a new spar, new ribs, and things 
 of that character. 
 
 Mr. McKenzie. I beg your pardon for diverting you from your 
 statement. 
 
 Col. Gillmore. I am not an ordnance officer, and I am not as 
 familiar with their problem in connection with this depot as I 
 would be if it were one of ours, but here is the way it looks to me : 
 The Ordnance Department has never settled with the Harrisburg 
 Real Estate Co. for these properties. I have made a careful investi- 
 gation of the facts, so far as I could, to get the information, and it 
 looks to me as if the Government was liable for damages that would 
 probably equal the price for which we can purchase the land. The 
 Harrisburg Real Estate Co. and the Ordnance people could present 
 that phase of it better than I can, but from my investigation of it, 
 and from the fact that this acreage lease or original lease has never 
 been canceled, and from the fact that we did go across there with 
 a pipe line and power line, it looks as if it would result in an award, 
 perhaps, in the Court of Claims, equal to what we could purchase 
 the land for now, namely, about $240,000, and settle the whole 
 proposition. 
 
 Mr. McKenzie. Your item here is $50,000. 
 
 Col. Gillmore. Yes, sir. That was put in by the Ordnance De- 
 partment. 
 
 Mr. McKenzie. Are there condemnation proceedings pending for 
 the whole tract? 
 
 Col. Gillmore. No, sir; requisition proceedings are pending on 
 82 acres at the Ordnance depot and 31 acres at the Air Service 
 depot. The remainder of it has never been settled, and it amounts 
 to $100,000, and more, for rental. 
 
 Mr. McKenzie. This bill would not take care of that ? 
 
 Col. Gillmore. I think it would. 
 
 Mr. McKenzie. You would want a direct authorization in here 
 to purchase real estate? 
 
 Col. Gillmore. Yes, sir; and to settle this claim with the Harris- 
 burg Real Estate Co. 
 
 Mr. McKenzie. It seems to me you would have to bring that mat- 
 ter up in a separate bill, or as an amendment to this bill, authoriz- 
 ing the War Department to go ahead and purchase the remainder 
 of this land not covered by the requisition proceedings. That is not 
 the purpose of this bill. The purpose of this bill is to enable the 
 War Department to make settlement for or on account of contracts 
 made prior to July 11, 1919. 
 
 Col. Williams. The Secretary of War wrote a letter to the com- 
 mittee asking that this bill be amended so as to include this item. 
 It provides for an amendment to the bill, and suggests the exact 
 amendment to go in so as to take care of this item in the bill. 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 19 
 
 Col. Gillmore. This was not prepared by me. 
 
 Mr. McKenzie. Suppose you read that letter into the record. 
 
 Gen. Carson. The letter of the Secretary of War is as follows: 
 
 Wab Department, 
 Washington, February 25, 1921. 
 Hon. Julius Kahx, 
 
 Chairman Committee on Military Affairs, 
 
 House of Representatives. 
 
 My Deab Mr. K.vhx : Near Middletown, Pa., and lying between the Pennsyl- 
 vania Railroad and the Susquehanna River, is a tract of land .standing in the 
 name of the Harrisburg Real Estate Co., containing 396.6 acres, on a portion of 
 which there has been constructed warehouses and other buildings and improve- 
 ments by the Ordnance Department and which now stands under the name of 
 the Middletown Ordnance Reserve 1 >epot. This tract was taken by the Ordnance 
 Department under a lease dated January IT, 1918. The rental was .$3,310 per 
 month. The lease contained a renewal clause and an option to purchase the 
 land at $500 per acre. In June, 1920, a reservation for $100,000 was set aside 
 for rents, and $17,050 was paid to July 1, 1918. No rent has since' been paid, and 
 the $82,950 remaining was carried over to the fiscal year ending June 30, 1921. 
 In August. 1918, condemnation proceedings were commenced for acquiring S2.1 
 acres of this tract on which the warehouses and other improvements had been 
 constructed. The proceedings resulted in an award in favor of the Harrisburg 
 Real Estate Co. of $3!). oil", with interest from the date of commencement of the 
 proceed ngs. The landowner refused to accept the award, no payment has been 
 made thereon, and Congress has made no appropriation to cover such payment. 
 
 H. It. 13929, introduced in the House of Representatives May 4, 1920, and 
 which was never passed, contained an item of $50,000 to be appropriated to 
 cover the acquisit on of tins 82.1 acres and a small plot containing 5.45 acres 
 requisitioned from Dr. W. H. Seibert, for which an award has been made, 
 amounting, with interest, to approximately $3,000. The proposed bill amending 
 H. R. 13112!) also contained this item. The Ordnance Department, after the 
 acquisition of this land, proposes to turn it over, with the buildings thereon, to 
 the Air Service. 
 
 The Air Service in 1918 constructed a depol at Middletown, Pa., now desig- 
 nated as Middletown Air Intermediate Depot, on 31.2 acres of land belonging 
 to the Harrisburg Real Estate Co. and adjoining the land occupied by the 
 Ordnance Department. The Air Service also extended to the east, taking up 
 about 20 acres of building lots known as Riefs extens'on. The whole plot was 
 requisitioned and awards of damages for permanent possession of 1 he land were 
 made and accepted by all the landowners except the Harrisburg Real Estate Co. 
 That company refused to accept an award Of $12,480 for the 31.2 acres but 
 received :;s 7." per cent of the award $10,586.16. The sum of $21,979.49 was paid 
 for lots acquired in Riefs extension. 
 
 o u February 2s, 1920, Congress appropriated $50,000 for the purchase of the 
 real estate of the aviation supply depot. The sum paid for land acquired in 
 Riefs extension and the sum paid to the Harrisburg Real Estate Co. as 17, per 
 cent of their award was paid from the $50,000 appropriated, and a balance now 
 remains from this appropriation of $17,434.37. which is available to pay any 
 award the court may make for the 31.2 acres acquired from the Harrisburg 
 Real Estate Co. 
 
 Xo action has been taken toward acquiring the 314.5 acres used by the Ord- 
 nance Department, and no item covering it was included in H. R. 13929 or the 
 proposed bill amending it, as the Government was in no way obligated to acquire 
 this land. A part of this land has been used by both the Ordnance Department 
 and Air Service, and is now in use as a flying field, and there are temporary 
 hangars thereon. There is also a water main, supplying the aviation depot, 
 running through the land and an electric power line crossing it. 
 
 The owners claim that the Government is still in possession of the ent're 
 tract, holding over under the original lease of January 17. 1918, and that there 
 was an accrued rental of three years on January 7. 1921. of $118,960, of which 
 sum $17,050 only has been paid. 
 
 The continuation of a flying field in connection with the combined aviation 
 supply and repair depot is not only desirable but essential, and it will be neces- 
 sary to acquire land for that purpose. If appropriations are not made available 
 for purchasing this land at this time it will be necessary to ask Congress at 
 
20 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 some later date for sufficient funds to purchase either this or other land adjoin- 
 ing the Middletown Air Intermediate Depot, find in the meantime values of 
 adjoining land may he greatly increased. 
 
 The ordnance Department has erected upon its tract of land some very 
 substantial buildings, at a cost of $1,372,180, and to make the plant com- 
 plete for use as an Air Service depot and flying field the land lying between 
 the two should be acquired rather than additional land elsewhere. The Har- 
 risburg Real Estate Co. has offered to make settlement of all their claims and 
 convey title to the entire 428 acres, including the S2 acres and the 31 acres, 
 concerning both of which there is dispute as to value, for the sum of $240,000, 
 and to credit the amount of $10,536.16 already received as 75 per cent of the 
 award made on the 31.2 acres. This would leave a net amount of $229,414, 
 for which they would deliver good title to the entire tract and cancel all 
 claims for rent and settle all disputes as to value now pending in court. The 
 land requisitioned from Dr. Seibert would require $3,000 additional, or a total 
 of $232,414. As there are unpaid accrued rentals on the land of the Harris- 
 burg Real Estate Co. approximating $100,000 and as $50,000 would be required 
 to acquire the land on which the Ordnance Department has erected improve- 
 ments, and approximately $30,000 more to acquire that occupied by the Middle- 
 town Air Intermediate Depot, it would seem to be in the interests of economy 
 to ask for appropriations to enable the War Department to accept the settle- 
 ment offered by the Harrisburg Real Estate Co. In addition to the $50,000 
 asked for in the bill amending H. R. 13929 and the $17,434 still available from 
 the appropriation of $50,000 on February 28, 1920, $165,000 additional will 
 have to be appropriated, as the $S2,950 set aside for rental can not be applied 
 to the purchase of this tract. 
 
 It is requested that H. R. 13929 as amended be further amended so as to 
 include an item of $165,000 to complete the purchase of the 427.8 acres of 
 land taken over by the War Department from the Harrisburg Real Estate Co. 
 and the 5.43 acres requisitioned from Dr. W. H. Seibert, which amount is 
 not covered by H. R. 13929 as amended, or other appropriations, making a 
 total available of $232,434.17, or that the item of $165,000 be made the subject 
 of separate legislation. 
 
 Summary of funds in connection with this project : 
 Funds required : 
 
 For settlement with Harrisburg Real Estate Co $240, 000. 00 
 
 For Rief's extension 21,979.49 
 
 For settlement with Dr. W. H. Seibert 3,000.00 
 
 Total 264, 979. 49 
 
 Funds already appropriated or requested in other bills: 
 
 Appropriated, act of Feb. 28, 1920 50,000.00 
 
 Requested in H. R. 13929 as amended 50, 000. 00 
 
 Total 100, 000. 00 
 
 Balance necessary 164,979. 49 
 
 Appropriation requested 165,000. 00 
 
 A tracing showing the different plots of land is inclosed herewith. 
 Cordially, yours, 
 
 Newton D. Baker, 
 
 Secretary of War. 
 
 Col. Williams. There is another letter which is later than that, 
 signed by Secretary Weeks. 
 
 Brig. Gen. Carson. Yes; does it change the substance? 
 
 Col. Williams. No; it does not change the substance, but asks 
 specific amendments to this bill. 
 
 Mr. Miller. Instead of procuring exclusively a repair station we 
 are acquiring another flying field ? 
 
 Brig. Gen. Carson. Yes; in connection with the repair station. 
 
 Mr. Miller. That is an element that will come into it after you 
 have the flying field ? 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 21 
 
 Col. (iiLLMORE. You know in repair of equipment you have got to 
 fly it after you repair it? 
 
 Mr. Miller. That is what I call a pretty good place to have a re- 
 pair depot, at the fields where they fly. 
 
 Col. Gillmore. I think if we had started out in the Air Service 
 according to your theory and built in one locality or two localities 
 our schools, repair depots, and supply depots, we would have been 
 wise. 
 
 Mr. Miller. At the flying fields ? 
 
 Col. Gillmore. We did not do that. YVe scattered them from Long 
 Island to Florida, Texas, and California, and up into other States 
 like Illinois and Ohio. 
 
 Mr. McKenzie. We are hoping for reform. 
 
 Col. Gillmore. We are trying to reform. If we could get into a 
 concentrated place ; but here we have over $2,000,000 in the Middle- 
 town project, and the Government has $1,325,000 invested alongside 
 of it ; I would gamble that the salvage of the ordnance depot build- 
 ing will not run $50,000. 
 
 Mr. McKenzie. I can understand why it might be advisable to 
 have a storage plant there for the Air Service on account of the 
 central location, and I can see where that it might be accepted by the 
 House without any particular objection, but to go further than that 
 and acquire several hundred acres of land beyond appears to me to 
 be at rather an extravagant price, although I have not seen the land 
 and know nothing about it. 
 
 Col. Gillmore. I am satisfied it is not. 
 
 Mr. McKenzie. Its location may make it valuable. 
 
 Col. Gillmore. Yes, sir. 
 
 Mr. McKenzie. But with hundreds of millions of acres of lands 
 in this country that could have been purchased at from $25 to $100 
 an acre, that would have answered the purpose just as well, I am 
 inclined to think that some one might raise the point in the House 
 that we were wasting money. My question is on the wisdom of 
 locating the plant in this particular place. 
 
 Brig. Gen. Carson. A plant of this kind is essentially an indus- 
 trial plant, and industrial plants, of course, are located near the 
 labor market. You might get land at $25 an acre so far away from 
 labor supply that you would have to go to the expense of housing 
 the labor. This is near Middletown, where labor and housing are 
 available. 
 
 Mr. Miller. What was this tract of land used for preceding the 
 Army's advent? 
 
 Col. Williams. This land was being prepared for a State fair 
 ground and race track, and these, people had spent $76,000 or more 
 on grading on it to establish a race track when the war came along 
 and the Government took over a portion of it. It is essentially land 
 to be used for industrial purposes. It is on the main line of the 
 Pennsylvania. 
 
 Mr. Miller. Was there any other use of it for industrial purposes ? 
 • Col. Williams. Not this particular tract. 
 
 Mr. Miller. How much of it was used for this race-track proposi- 
 tion? 
 
 Col. Williams. The entire tract. 
 
22 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Mr. Miller. I understand Col. Gilmore states that there was 
 quite a large number of city lots purchased ? 
 
 Col. Williams. That was for the Air Service, east of this, just 
 on the edge of Middletown. 
 
 Col. Gillmore. That is all industrial along there. It is full of steel 
 mills or plants. You can not tell when you are out of one town into 
 another. It is on the main line of the Pennsylvania, following the 
 river from Harrisburg down. 
 
 Col. Williams. This is the only undeveloped industrial tract of 
 land there. 
 
 Brig. Gen. Carson. I would like to put into the record now this 
 letter, signed by Secretary Weeks, to indicate that the present War 
 Department administration support the recommendation of its prede- 
 cessor. It is a letter addressed to Mr. Kahn, dated May 6. The 
 amount of $165,000 was the total amount necessary to complete the 
 purchase of the 410 acres of land Ave have been talking about. 
 (The letter referred to is as follows :) 
 
 May 6, 1921. 
 Hon. Julius Kahn, 
 
 Chairman Committee on Military Affairs, 
 
 House of Representatives. 
 
 My Dear Mr. Kahn: In accordance with your request of April IS, 1921, the 
 following report in duplicate is submitted on the inclosed H. R. 204. 
 
 My predecessor, in a communication to you dated February 25, 1021, requested 
 that H. R. 13929, as amended by H. R. 16127, be further amended to include an 
 item of .$165,000 to complete the purchase of 427.S acres of land taken over 
 by the War Department from the Harrisburg Real Estate Co., and 5.43 acres 
 requisitioned from Dr. W. II. Seibert, which amount was not covered by H. R. 
 13829 as amended or other appropriations. It is recommended that H. R. 204 
 be amended to include this item. 
 
 The amendments necessary appear to be as follows : 
 
 On page 2, line 4, insert, after the word " thereof." the following: " Or leases 
 made with an option to purchase." 
 
 On page 3, line 6, add the following: ''To complete the purchase, near Middle- 
 town, Pa., of 427.8 acres of land taken over from the Harrisburg Real Estate Co. 
 and to purchase 5.43 acres requisitioned from Dr. W. H. Seibert, $165,000." 
 
 The items in the accompanying bill carry no appropriations for the payment 
 of any awards made by the Court of Claims, as it is understood that all such 
 awards are appropriated for by Congress pursuant to the recommendations of 
 the committees who pass on such awards. 
 Respectfully, 
 
 John W. Weeks, Secretary of War. 
 
 Mr. McKenzie. Instead of having $50,000, shown in the bill, it 
 would be $10.-) ,000. 
 
 Maj. Gen. Carson. It is a larger area. The $50,000 covers a small 
 area. 
 
 Col. Gillmore. The $50,000 covers 82 acres only. 
 
 Mr. Miller. The $105,000 covers both areas? 
 
 Col. Gillmore. The $105,000 covers the entire area and gives a 
 clear title. 
 
 Mr. Miller. It would not be the $165,000 plus the $50,000? 
 
 Col. Williams. Yes. 
 
 Mr. Miller. That is what I am getting at, that we should add to 
 the bill $165,000 more. 
 
 Col. Williams. That is right. 
 
 Mr. Greene. Is this lot that is to be added to the $50,000 worth any- 
 thing in the peace-time activities unless you have the other that is 
 worth $165,000 more? 
 
REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 23 
 
 Col. Gillmore. No, sir ; if this appropriation is not made what will 
 happen is that the Ordnance Department will settle through the 
 Court of Claims the rental proposition and will sell the $1,320,000 
 of improvements as a salvage proposition. 
 
 Mr. McKenzie. My understanding is that the bill for $50,000 
 will take over just these buildings that have been used by the Ord- 
 nance Department for storage purposes, and that then they could 
 transfer them over to you to be used as a center to keep your repairs 
 and stocks and as distributing areas over the entire country adjacent 
 thereto. 
 
 Col. Gillmore. They have refused to accept that award, for which 
 this $50,000 is carried. 
 
 Mr. McKenzie. The award was $39,000, and the bill carries 
 $50,000, which I assume was to take care of any increases. 
 
 Col. Gillmore. The Harrisburg Eeal Estate Co. have stated in 
 writing that they would not accept $50,000. Is that correct? 
 
 Col. Williams. That is correct. 
 
 Capt. Calhoun. That is to cover rent on this tract. 
 
 Brig. Gen. Carson. Mr. Baker's letter indicates a certain amount 
 already paid on account. 
 
 Col. Williams. I think I can probably explain that. The previ- 
 ous bill carried $50,000 to take care of the 31 acres for the Air 
 Service. That is 31 acres east of the canal. 
 
 Col. von dem Bussche. Eightjr-nine acres, is it not? 
 
 Brig. Gen. Carson. Thirty one. 
 
 Col. von dem Bussche. The $50,000 added to that is for the 89 
 acres requisitioned; not the 31 acres. 
 
 Brig. Gen. Carson. I am speaking of the previous bill which did 
 pass Congress; out of that sum $10,000 was paid as representing 
 75 per cent of the award, and that leaves in the possession of the 
 War Department, after paying certain other items, $17,000 which 
 is still available. That is still available to acquire any of this land 
 if authorized by Congress. This bill, H. R, 204, ar originally in- 
 troduced, carries an item of $50,000 for 82 acres on which the ord- 
 nance buildings are erected. If the bill passes, that will be avail- 
 able. They will need in addition to the $17,000 left over from the 
 other appropriation and in addition to the $50,000 carried in this 
 original bill $165,000 which will pay the Harrisburg Real Estate 
 Co. the $240,000 less the $10,000 alreadv obtained, and will pay Dr. 
 Seibert about $3,000 for his 5 acres, so the $165,000, if added on to 
 this bill, will take care of the whole proposition. 
 
 Mr. Miller. Was this Harrisburg Real Estate Co. organized for 
 the purpose of acquiring this land and turning it over to this race- 
 track proposition ? 
 
 Col. Williams. They spent $76,000 to improve the tract. 
 
 Capt. Calhoun. And they objected very seriously to it being 
 
 taken. ^ • n 
 
 Mr. Greene. Was this Harrisburg Real Estate Co. made up as a 
 continuing business institution? Had it a business past, or was it 
 an association of citizens interested only in the race-track proposi- 
 tion and organized in that way only for that purpose? 
 
 Col. Williams. That is all. . 
 
 Mr. Greene. They are not engaged in the real estate business i 
 
24 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Col. Williams. Nothing else that I know of. 
 
 Gapt. Calhoun. It was just for this enterprise. 
 
 Mr. Miller. Would the improvements placed on this land by the 
 Government destroy it as a race track? 
 
 Col. Williams. Yes, sir. Some of the buildings were erected 
 across the race track — across the graded race track. 
 
 Mr. Miller. I can see very clearly the aims of it from this general 
 explanation here; but what sticks me is going to buy another flying 
 field, with all the attendant expenses it will take to equip that 
 flying field, such as officers' quarters and things of that kind, and I 
 fear we will have some trouble with it on the floor of the House — to 
 buy another flying field. 
 
 The Chairman. We will have a great deal of trouble unless the 
 colonel can give us specific assurances. 
 
 Col. Gillmore. What I would like to see the committee do is to try 
 to look into the future of the development of this game. We have 
 got $3,000,000 approximately of good Government money invested 
 there in those buildings and improvements, and there is no question 
 but what we are located right as far as the supply and repair game is 
 concerned. We have splendid railroad facilities and we have a good 
 labor market and Ave are on the only available strip of land around 
 there that is suitable for that purpose. Now, I think it would be 
 foolish when we can settle this thing for this amount of money to let 
 it go and then sometime go and buy perhaps some other site where the 
 buildings will cost us practically the same thing. We have buildings 
 there now and have that money invested, and it is a development 
 proposition, and looking to the future I think that we would save 
 probably $1,500,000. 
 
 Mr. McKenzie. In connection with that view, I would say that we 
 hope that in future Congress will exercise some discretion in grant- 
 ing to the War Department the right or authorize them to buy real 
 estate without further investigation of what is going to come of it as 
 far as the Military Establishment is concerned. During the war, a 
 time when everything was expanded, we were all subject more or less 
 to hysteria, and there was a large real estate division in the War 
 Department, many of the officers apparently thinking they were 
 doing a patriotic duty in going out and purchasing land here and 
 there and everywhere, and where they could not purchase it outright 
 they placed condemnation proceedings on it. We are simply loaded 
 down all over this country with real estate, either absolutely owned 
 or the title pending in the courts or under lease, that we have no 
 earthly use for. We have been working for years, some of us, trying 
 to get a list of them, get a bird's-eye view of it, as you might put it, 
 of what we are really confronted with on this matter of real estate. 
 
 Now, we hope, with the aid of the War Department, that in due 
 course of time we will eliminate all of these plants that are unneces- 
 sary and get rid of the overhead and centralize at the places where 
 it would be really to the advantage of the military establishments. 
 Now, I would not say that this field is the one we would retain, but 
 when we do that you certainly ought to be willing to recommend to 
 Congress or the War Department that here are a half dozen other 
 fields that we have no use for at the present time and see no prospec- 
 tive use for them in the near future; let us get rid of the overhead 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 25 
 
 in salaries and concentrate the activities not only of the Air Service, 
 but of every other service in the Army. 
 
 Col. Gillmore. We have been doing that. We are getting rid of 
 a number of fields and depots. 
 
 Mr. Miller. If you can show to Congress where they can dispose 
 of one or two other fields for $1,000,000 or $1,500,000 and buy this 
 one for $265,000, then that would be right in line with that same 
 fine policy. 
 
 Capt, Calhoun. That is $230,000. 
 
 Brig. Gen. Carson. Did not the letter mention two or three places? 
 
 Mr. Miller. What are they? Put them in the record. 
 
 Col. Gillmore. The Richmond depot at Richmond, Va., which 
 cost us about $1,250,000, is on our definite plan to give up in the 
 next fiscal year. 
 
 Mr. Miller. What can that be salvaged for? 
 
 Col. Gillmore. It is a very good construction. I do not know. 
 
 Mr. Miller. Give an estimate. 
 
 Col. von dem Bussche. I have had several inquiries to purchase 
 that plant for approximately $1,000,000 suggested as a purchase 
 price by a corporation down there. The property has a very fine 
 salable value. 
 
 Mr. Miller. That could be disposed of? 
 
 Col. von dem Bussche. Yes. 
 
 Mr. Miller. What is the next one? 
 
 Col. Gillmore. The next one is Morrison, Va. ; 48 large warehouses 
 there. It is a lease proposition. 
 
 Mr. Miller. Are the 48 warehouses of brick construction? 
 
 Col. Gillmore. No, sir; wooden construction, but very good con- 
 struction. 
 
 Mr. Miller. Could that be salvaged to advantage? 
 
 Col. Gillmore. There is a railroad spur track alongside each ware- 
 house. It comes in along the main line and there is a spur to the 
 warehouses which were built at an angle. 
 
 Mr. Miller. Could that be salvaged at an advantage to the Gov- 
 ernment ? 
 
 Col. Gillmore. Not later than last week there was a gentleman 
 from Norfolk who said he represented a good deal of capital and 
 that they were anxious to get that property, and said they were in 
 position to offer very good prices. 
 
 Mr. Miller. Did lie make any suggestion as to the amount ? 
 
 Col. Gillmore. No, sir. 
 
 Mr. Miller. What would be reasonable in the range of value 
 you could probably get ? 
 
 Col. Gillmore. I think we ought to get between $200,000 and 
 $300,000 for it. 
 
 Mr. Miller. That can be given up and that money come in ? 
 
 Col. Gillmore. That is on our program. 
 
 Mr. Miller. What is the third one ? 
 
 Col. Gillmore. The Little Rock Depot, Ark. The reason we are 
 not planning on that this next year is because the motors are con- 
 centrated there. I think you visited it. 
 
 Mr. Miller. I was not there, but I heard about it. 
 
 Col. Gillmore. We have thousands of Liberty motors, Lerhones, 
 Hispanos, and O. X. 5's. It is cheaper to keep the depot than it is 
 
26 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 to move the motors right now, but as those motors are going out into 
 use that depot can be given up. That depot is of very good construc- 
 tion and in an industrial section at Little Rock and will bring a 
 good price as an industrial plant. It has about the same character 
 of construction as the Richmond one. 
 
 Mr. Miller. It might turn out to be cheaper to retain this and dis- 
 tribute the motors to other places? 
 
 Col. Gillmore. It is one we are going to give up. 
 
 Mr. Greene. All this gets down to this analysis: You are selling 
 something you do not want and propose to put that money into some- 
 thing you do not need, and therefore you have got it for nothing. 
 That is what the question will be if you do not decide on the utility 
 for this particular site here as compared with your present policy. 
 It is all right to say you can sell something you do not want that is 
 being kept up at an overhead expense for a certain price, but there 
 is no economic gain in dumping that money into something else that 
 may not be wanted either. 
 
 Col. Gillmore. I can not imagine of our not wanting a repair and 
 supply depot in this section of the country. The whole area we have 
 to supply is so great, railroad facilities so good, and the strategical 
 location so excellent that I can not imagine doing anything but 
 locating there. 
 
 Mr. Greene. The question you have to balance to get the indorse- 
 ment of Congress is not simply a military one. You and I know 
 that from years of experience here. 
 
 Col. Gillmore. Yes, sir. 
 
 Mr. Greene. Sitting around this table and trying to appropriate 
 for a military program because it was approved as a military pro- 
 gram and that was the end of it, we could easily get up a system of 
 activities that might include this. 
 
 Capt. Calhoun. That has already been clone by the staff, and this 
 is one of the strategical points they have selected. 
 
 Mr. Greene. I am getting at the approval of that and bringing 
 the money out of the Treasury for it. We have to take into reckon- 
 ing the economic value, but none the less we respect the figures of the 
 military plan. You would have to show why this kind of a policy 
 of establishing centralized repair shops, and so on, is more economical 
 tli an the distribution in local flying fields. 
 
 Co]. ( riLLMORE. I will be very glad to give you the figures. 
 
 Mr. Greene. It is very desirable that somewhere you put the figures 
 into the record. 
 
 Brig. Gen. Carson. Would it not be well to summarize for the gen- 
 tlemen of the subcommittee the fact that there are really two propo- 
 sitions involved here; in the first place, the Air Service has a field 
 and the Government owns some of the land on which it is located. 
 In the second place, the Ordnance Department does not want the 
 depot there, and the Air Service desires to get it to add to what they 
 have now. 
 
 Mr. Greene. Here is another thing w T e ought to know on what 
 might grow out of a situation like that. Uncle Sam has a title in 
 fee to land acquired through stress of war or something of that kind, 
 and he has now an asset worth so much, but if there is no economic 
 use for it, its yearly upkeep and maintenance indicate that he would 
 have been better off to have even given it up rather than to keep it. 
 
REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 27 
 
 Brig. Gen. Carson. This proposition involves the abandoning of 
 a large plant at Richmond, Va., which, as Col. von dem Bnssche 
 states, is one asset. 
 
 Mr. Greene. I say, again, that I do not accept that idea of getting 
 a certain market price so to show a gain. We are only getting back 
 part of what we had to pay during the war and there is no economic 
 gam about it. The question is whether or not that money might not 
 be better covered into the Treasury than expended as if it was a busi- 
 ness proposition in any activity of a similar kind to-day which you 
 have just released. 
 
 Col. Gillmore. I think in that argument, Mr. Greene, you lost 
 sight of the fact that there is $1,325,000 worth of Government im- 
 provements on this 82 acres of land now. 
 
 Mr. Greene. I was just speaking to the General about that. It is 
 very conceivable that in any man's business experience he has ac- 
 quired something which is no longer useful, a certain bit of land or 
 property which cost so much and is charged off at so much on the 
 books, and if you have now to maintain that property it will take but 
 a few years to have cost as much as was originally paid for it, and it 
 may be better to realize on it right off. The mere possession of any- 
 thing is not an asset; sometimes it is a liability. 
 
 Col. Gillmore. That would take us back to the proposition that it 
 is not economical to make motor repairs. 
 
 Mr. Greene. Tlurt is what I want you to show. 
 
 Col. Gillmore. As a repair depot. 
 
 Mr. Greene. I want you to show that in such amplification of the 
 testimony as the chairman may sanction, because I can see it myself 
 as bookkeeping logic ; but it has got to be shown. 
 
 Mr. McKenzie. You may extend your remarks in the record if you 
 will get the transcript back to the committee as soon as possible. I 
 would like to have it with the report to be filed on the bill so the 
 Members of Congress will get some idea of the matter when it is on 
 the floor. 
 
 Col. von dem Bussche. This statement will cover that and show 
 whether obligated under contract or under requisition, etc. 
 
 Mr. Greene. Is that term ' ; requisition " sufficiently understood so 
 that explanation is not necessary 3 
 
 Col. von dem Bussche. The requisition was an emergency power 
 given for the obtaining of property. 
 
 The Chairman. Followed by condemnation. 
 
 (Statement submitted by Col. Gillmore:) - 
 
 It is believed that aside from the many other advantages to be gained by 
 making this appropriation and authorizing the proposed settlement it might 
 result in an actual saving of money to the Government if tins land is pur- 
 chased. 
 
 There are two requisition proceedings pending, both started in 1918; one 
 covering 31.2 acres now occupied as part of the Air Service depot and one 
 covering 82.1 acres occupied by the Ordnance depot. An award of $12,480 was 
 made in the first proceeding and of $39,512 in the second proceeding. Both 
 awards have been refused by the landowners, but if they should accept the total 
 amount to be paid with interest up to June 30, 1921, it would be $63,066.75. 
 This includes the award to Dr. Siebert, which with interest, amounts to $2,816.08. 
 It is understood that he will accept that, amount. 
 
 The Harrisburg Real Estate Co.. which owns all the rest of the land under 
 consideration, has refused to accept the award and they can proceed in the 
 
 I 
 
28 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 United States district court under the provisions of section 10 of the food and 
 fuel act, and try out the question as to just how much the award should be. 
 
 From investigation it is believed that awards made might be increased by 
 action in court and a jury might award not less than $1,000 per acre for each 
 of the two parcels under requisition proceedings. That would be a total of 
 113.3 acres for the sum of $113,300. This would be an increase over the award 
 actually made by the sum of $61,308. Interest on that sum from August 8, 
 1918, the date of the starting of the requisition proceedings, amounts to 
 $10,647.15. 
 
 This estimate is for the land actually taken. To it. must be added the amount 
 of damage or depreciation in value sustained by the rest of the tract. There 
 w r ere 427.8 acres first taken over by the Ordnance Department under lease. 
 That comprises the whole piece of land running down to the old canal which is 
 the north boundary of the Air Service depot. Taking away 82.1 acres of the 
 best part of this tract, which lies nearest, the railroad, reduces the desirability 
 of the remaining land as a plot for manufacturing site. It is understood that 
 such damages to adjoining land will also be considered in proceedings of that 
 nature. The amount of such damage is estimated in this way : 
 
 The Ordnance Department land covered by its lease, amounting to 396.7 acres, 
 is given a minimum value of $500 per acre. That is the lowest figure stated by 
 any witness on the requisition hearing. The value would be $198,300. Deduct- 
 ing therefrom the proceeds of the 82.1 acres taken at $1,000 per acre leaves 
 $116,250. This must be further reduced by crediting the value of the remaining 
 land at $100 per acre, or $31,450. The item of injury to the land outside the 
 82.1-acre piece is thus found to amount to $84,800. Interest on that sum for three 
 years ending June 30, 1921, is $15,264,000. 
 
 There is a claim on file in the office of the War Department Claims Board for 
 use and occupation of the land at the rate of rent inserted in the original lease, 
 which is $3,310 per month. If this claim were sustained, the amount for 36 
 months would be $119,260. That would doubtless be greatly reduced, however, 
 in case the awards are increased as above estimated and bear interest. But 
 the use and occupation of the outlying land, containing 314.5 acres, must be paid 
 for. That land has been valued, after the other pieces are taken away, at a 
 maximum amount of $100 per acre. A rental of 6 per cent on this valuation 
 of 314.5 acres at $100 per acre for three years will produce the sum of 
 $5,662.80. These figures make a total of $240,148.70. 
 
 These estimates are based on a physical examination of the property and an 
 examination of the testimony adduced at the hearing in the requisition proceed- 
 ings, and upon the common experience in such cases, where a local jury is called 
 upon to estimate values and damages in cases where land is taken by the 
 Government. 
 
 If the proceedings were allowed to be finished as started and pending and 
 result in a necessary payment of the amount stated, to wit, $240,148.70, the 
 Government will then own two pieces of land, one of 82.1 acres and the other 
 31.2 acres, and all claims for damages for use and occupation of the adjoining 
 land will be settled. But there will remain installed in the land lying between 
 the two parcels a water-main line, which supplies the Air Service depot, and an 
 electric power line running across said land. To remove these improvements 
 would cost thousands of dollars, and to install other improvements to take their 
 place would be a large additional expense. 
 
 The entire matter can be settled by payment of $240,000 and the entire tract 
 of 427 acres of land acquired by the Government. This can be accomplished by 
 use of the appropriation of $50,000 already in the bill, and by the additional 
 $165,000 in the amendment suggested by Secretary of War Weeks in his letter 
 of May 6, 1921. 
 
 With further reference to the matter discussed with reference to cost of 
 maintaining a central repair depot and maintaining repair depots and the 
 qualified mechanical personnel at each flying field for the major repair of motors 
 and planes, it is estimated that for the movement of equipment to and from 
 repair depots for the entire United States $300,000 per year would cover all the 
 transportation charges. Now, as a comparison, we will assume the First Army 
 Area, which comprises the First, Second, and Third Corps Areas, would prob- 
 ably amount to about $150,000 a year. Should separate repair activities be 
 established at the Aberdeen, Boiling, and Langley Fields, it would require at 
 least $500,000 a year for the personnel alone, which gives a difference of $350,000 
 and which is $50,000 in excess of the transportation for the entire United States. 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 29 
 
 In other words, it is estimated that the actual transportation used for this pur- 
 pose in the First Army Area does not exceed $75,000 ; that is, by establishing 
 separate repair activities at all flying fields for this area and doing away with 
 the centralized repair activities, the cost of personnel alone would exceed the 
 cost of transportation by approximately $400,000. 
 
 (Thereupon, at 12 o'clock noon, the subcommittee adjourned to meet 
 again at 10 o'clock a. m., Tuesday, May 24, 1921.) 
 
 Subcommittee of the 
 Committee on Military Affairs, 
 
 House of Representatives, 
 
 Tuesday, May &£, 1921. 
 The subcommittee met at 10 o'clock a. m., Hon. John C. Mc- 
 Kenzie (chairman) presiding. 
 
 STATEMENTS OF BRIG. GEN. J. M. CARSON, CHIEF CONSTRUCTION 
 SERVICE, OFFICE OF THE QUARTERMASTER GENERAL, AND 
 MAJ. C. F. VON DEM BUSSCHE. 
 
 Mr. McKenzie. The first item in the bill is for the Army supply 
 base, New Orleans, La., $282,000. Major, if you will give us a 
 little explanation of that we will be glad to hear it. 
 
 Ma j. von dem Bussche. The project is known as the New Orleans 
 Army supply base, located at New Orleans, La. The number of 
 acres involved is 39.97, of which 10.72 acres were acquired on Au- 
 gust 9, 1918. and there are 29.25 acres yet to be acquired. 
 
 Mr. McKenzie. The 10.72 acres have been bought and paid for? 
 
 Maj. von dem Bussche. Yes, sir. The other, I believe, belonged 
 to the Dock Commission of New Orleans. The improvements on 
 this property consist of a wharf with a two-story structural steel 
 wharf house, 2,000 feet long by 140 feet wide, back of which are 
 three 6-story reinforced concrete warehouses, together with ade- 
 quate railroad classification and storage yards. The storage space 
 covers 2,072.000 square feet gross, and 1,685,000 square feet net. 
 The investment in land acquired amounts to $51,800, and the amount 
 under contract is $282,000. The improvements amount to $12,500,- 
 000, so that the total investment that we will have there will amount 
 to $12,833,800. 
 
 Mr. McKenzie. That $282,000 is the amount that the Government 
 was obligated to pay prior to July 11, 1919? 
 
 Maj. von dem Bussche. The difficulty was this: In a great many 
 of these cases the transactions were not completed because we were 
 required by law to have the titles examined by the Attorney Gen- 
 ral or the Judge Advocate General, and of course that required 
 some time. There was no dispute as to the values, and this was a 
 completed contract so far as the United States was concerned. We 
 were simply waiting for the papers to come back with reports on 
 the titles. 
 
 Mr. McKenzie. This purchase was made from the dock commis- 
 sion of New Orleans? 
 
 Maj. von dem Bussche. Yes, sir; they owned the land and it was 
 a reasonable price. 
 
30 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Mr. McKenzie. This particular plant, I assume, will not be of 
 any value for military use in peace time, but it is a project that 
 probably could be either leased to the city of New Orleans or sold 
 to parties who might be interested there? 
 
 Maj. von dem Bussche. I should say that it has a particular mili- 
 tary value in that it would be the key port in case we ever operated 
 against Mexico. That is my own judgment, and I am not saying 
 this from the viewpoint of the War Department. I should think 
 that it would be a particularly valuable port plant because of its 
 location. 
 
 Mr. McKenzie. Would it be your judgment, or that of Gen. Car- 
 son, that it would be well for the Government to keep a string on 
 this property? You might lease it, but still retain such jurisdiction 
 as would enable you to take it over at any time it became desirable. 
 
 Gen. Carson. Unquestionably; and it is also of potential value as 
 a base of supply for Panama. While for a time or during peace- 
 time operations we might not require all of it, we would probably 
 require some of it for that very purpose, and we could lease the bal- 
 ance of the available or surplus space to commercial interests. As 
 a matter of fact, that is what we are doing at the present moment. 
 
 Mr. Greene. That suggestion that it could be used as a base of 
 supplies for Panama induces me to inquire whether it would be a 
 base of supplies for any of our continental garrisons in that region 
 at all ? 
 
 Gen. Carson. I do not understand that. Do you mean United 
 States garrisons? 
 
 Mr. Greene. Yes. 
 
 Gen. Carson. We have been using it as a base of supplies for 
 some of our forces along the Gulf coast, and we are still shipping 
 from there to points in Texas. To what extent it will continue to 
 be so used is, of course, problematical. 
 
 Mr. Greene. That is probably just because we had it, but if you 
 were now to locate a supply base for all our garrisons in the South 
 and Southwest you would not put it at New Orleans, would you? 
 
 Gen. Carson. Not necessarily. 
 
 Mr. Greene. The question is whether whatever value there may be 
 in this site is a prospective one. or one that we could realize upon 
 from day to day now. If we should have an Army base in the 
 South to take care of the South generally we would not maintain 
 a great base like that at New Orleans just to take care of Panama. 
 
 Gen. Carson. We have nothing else in that region that can take 
 care of Panama and that has water connections. The principal 
 depot or base or supplies for the forces in Texas is at San Antonio, 
 and there is another one at El Paso. The only way by which we 
 could get supplies from those places to Panama, except New Orleans, 
 would be through Galveston, and we have no activities there at all. 
 
 Mr. Greene. What I am getting at is this : If you were consulting 
 the most economical plan, you would not necessarily decide that you 
 would have to maintain a water base of supplies, nor any other for 
 that matter, limited to the supply of Panama, when you have any 
 number of interior bases that would supply a much greater region 
 roundabout. 
 
 Gen. Carson. On that basis ; no, sir ; but the base at New Orleans 
 has great potential value. 
 
REAL ESTATE- — TO COMPLETE ACQUISITION IN CERTAIN CASES. 31 
 
 Mr. Greene. That is what I am (jetting at. It has a war value 
 rather than an immediate peace value, or it is not an immediate 
 peace-time economy. 
 
 (Ten. Carson. We feel that the Government is not expending any 
 money unnecessarily upon it, because whatever use we do not re- 
 quire of it for our own military purposes is turned over to com- 
 mercial interests, so that the Government or the country itself is 
 getting a direct benefit from it. 
 
 Mr. Greene. So far as any supplies or operations in the Gulf are 
 concerned, that would probably be better controlled from some 
 point toward the West Indies side rather than at the mouth of the 
 Mississippi — that is. from the practical or strategic standpoint. 
 
 (Ten. Carson. The only other pla< es are on the Atlantic coast, and 
 you would have to go to Charleston. Norfolk, or Philadelphia. 
 
 Mr. Greene. The situation that presents itself in this particular 
 case is this: If we were going to establish or maintain a base on the 
 Gulf coast, the question would be whether it should be at New 
 Orleans or somewhere else. If we were now making the first venture 
 in that direction, we would not be likely to locate it at New Orleans, 
 would we 1 
 
 Gen. Carson. New Orleans is the best location, I think, for such a 
 base of operations — that is. with everything considered in the way 
 of water facilities, railroad connections, etc. 
 
 Mr. Greene. I am speaking of the military tactical or strategic 
 side of it. Your operations are more likely to be active at the en- 
 trance to the Gulf than down there in the bowels of it, are they not? 
 
 Gen. Carson. No. sir; I think that under those ciroumstances this 
 would be found to be the preferable point. Mobile, Pensacola, and 
 Tampa have not as good railroad facilities as they have at New 
 Orleans. 
 
 Mr. McKexzie. You could ship supplies from this base around 
 through the canal to the Pacific coast, if you were so disposed? 
 
 Gen. Carson. Yes, sir. As a matter of fact, we have been doing 
 that very thing. We have been supplying Panama from New York 
 and also from New Orleans, but. of course, the difference in sailing 
 time is very much in favor of New Orleans. 
 
 Mr .McKexzie. The next item is for the Aimy supply base at 
 Brooklyn, N. Y., of $1,590,675.52. Now. major, we will be very 
 glad to have you give us some information with regard to that item. 
 Those great storehouses were constructed there, I presume, under 
 the direction of Gen. Goethals. 
 
 Maj. von dem Bussche. This pioperty is lmown as the Brooklyn 
 Army supply base, and it is located at Brooklyn, N. Y. It consists 
 of 99.97 acres, all of which was acquired by requisition in April and 
 May, 1918. Payment in the amount of $2,334,972.38 has been made 
 in full for 42.93 acres. Part payment in the amount of $1,427,860.87 
 has been made on 57.04 acres. That part payment is understood to 
 mean the payment of the 75 per cent after the award and requisition. 
 
 Mr. Greene. Were those part payments made on separate par- 
 cels of land, or were they separate purchases ? 
 
 Maj. von dem Bussche. That was because of separate ownerships. 
 
 Mr. McKenzie. You made contracts of purchase for certain parts 
 of it, and other parts you had to condemn or requisition? 
 
 50916—21 3 
 
32 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Maj. von dem Btjssche. Yes, sir; we had to requisition it. The im- 
 provements upon this property consist of two eight-story warehouses 
 of concrete construction, three two-story wharf sheds with four 
 piers, all of concrete construction, and adequate railroad storage and 
 classification yards. The total storage space amounts to 4,681,220 
 square feet gross and 3,800,224 square feet net. The land investment 
 amounts to $3,762,833.25 paid, and the amount in this bill estimated 
 for completion is $1,590,675.52. 
 
 Mr. McKenzie. That is for the completion of the project \ 
 
 Maj. von dem Bussche. Yes. sir; for the completion of the project. 
 In other words, the land outlined here in red [indicating] we already 
 own. For this part we have paid 75 per cent of the award, and this 
 is the amount estimated as necessary to complete it. The total invest- 
 ment in this property is $31,353,508.77. The recommendation in this 
 case is the same as that in others — that is, that payment for the land 
 under requisition be completed in order to protect the Government's 
 improvement investment. This land should be acquired in order 
 to protect the investment already made. 
 
 Mr. McKenzie. How much of that plant are you using at this time? 
 
 Gen. Carson. The War Department is using the entire plant. The 
 warehouses are still practically filled with supplies resulting from 
 the war accumulation. It is an active supply base. We are not only 
 supplying from this base our depots and the troops in corps areas 
 adjacent to it but it is also the base of supplies for our forces in 
 Germany. 
 
 Mr. McKenzie. General, do you make use of all these piers, or do 
 you lease them ? 
 
 Gen. Carson. I was going to add that we are at the present moment 
 leasing one of the piers to a steamship company, the Kerr Co., I 
 believe, and the other has been turned over to the Shipping Board 
 for its Operations. We are using the third pier for our own Opera- 
 tions. 
 
 Mr. McKenzie. What rental do you get from the one leased to 
 the Kerr people? 
 
 Gen. Carson. I will correct the figure later, but I think it is in 
 the neighborhood of $240,000 a year. ' (Note: $232,029.) 
 
 Mr. McKenzie. Does the Shipping Board pay you anything, or 
 do you have any bookkeeping account showing that a certain amount 
 of this overhead should be charged to the Shipping Board rather 
 than to the Military Establishment? 
 
 Gen. Carson. The agreement with the Shipping Board, if my recol- 
 lection is correct, is that it is without compensation to the War De- 
 partment. 
 
 Mr. McKenzie. That is fine business for the Shipping Board. 
 
 Mr. Greene. That is why we get this constant cry that it costs so 
 much to maintain the Arnry. The other little fellows run after 
 leaving their babies on your doorstep. 
 
 Mr. McKenzie. When The Adjutant General of the Army makes 
 his report, or when the Secretary of War makes his annual report 
 to Congress, it seems to me that it would be a very proper tiling to 
 include in that report the amount of rental received for military 
 property and turned into the Treasury, emphasizing the fact that 
 to that extent, at least, the appropriations for the Military Estab- 
 
REAL, ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 33 
 
 lishment should be reduced, or rather, that the appropriations for 
 the Military Establishment should not be charged with the total 
 amount. As Mr. Greene has said, the military establishment is be- 
 ing condemned for being a very expensive department, and if we 
 can make any showing that would relieve the minds of the people 
 on that score. I think it should be made. 
 
 Mr, Greene. They are entitled to it as a matter of common self- 
 preservation. 
 
 Gen. Carson. We are preparing such data, and I hope it will be 
 given out, as you suggest, in the Secretary's report. 
 
 Mr. McKenzie. Of course, all such property as this particular 
 plant is, I would not say garrisoned, but manned by civilian em- 
 ployees, and it is, undoubtedly, quite a heavy expense. Right along 
 that line, what Mr. Greene and some of the rest of US on this special 
 committee are trying to arrive at is some intelligent understanding 
 of the amount of property that we have of this kind. We feel, and 
 I believe that the Army begins to realize, that it would be, not only 
 wise, but an economical thing for the War Department to lease all 
 such plants as this wherever it can possibly be done. Where there 
 is no real future or prospective use. the property should be sold. 
 Where it is leased, you can get a certain amount of rental, and you 
 will be relieved of the overhead charge of caring for the property. 
 It seems to me that eventually the greater portion of this plant 
 or all of the piers might be leased, and the Government could retain 
 the right to load or unload at one of them. 
 
 Gen. Carson. I can assure you that that is precisely what we are 
 doing now. We are leasing such property at Boston and two piers 
 are being leased at New York. Other surplus space at Philadelphia, 
 Norfolk, Charleston, and New Orleans is being leased for com- 
 mercial use. Eventually when the space in the bio- warehouse is 
 not required for Army stores and supplies it will be leased to com- 
 mercial interests. 
 
 Mr. McKenzie. Can you tell us offhand about how many . ivilian 
 employees you have at this particular place? 
 
 Gen. Carson. At the present moment I can not, but about a year 
 ago we had about 6,000. That was not at this particular plant, but at 
 the New York general depot, which included the depot on Governors 
 Island, Port Newark, and Kearney. How many of them were at 
 this depot I can not recall. 
 
 Mr. McKenzie. That meant an enormous expenditure. 
 
 Gen. Carson. Yes, sir. When I took hold of it in the summer of 
 1919 we had 12,000. 
 
 Mr. Greene. General, is the fact that this tract is located on an 
 island 
 
 Gen. Carson (interposing). Pardon me, it is on the Brooklyn 
 shore. 
 
 Mr. Greene. I thought you made some reference to Long Island. 
 
 Gen. Carson. Brooklyn is on Long Island. 
 
 Mr. Greene. That is what I am getting at. It is on an island. 
 Does that give it any particular economic advantage over what it 
 might have if it were a mainland base? 
 
 Gen. Carson. For all practical purposes; it is a part of the main- 
 land, anyhow. 
 
34 REAL ESTATE — TO COMPLETE ACQUISITION IN" CERTAIN CASES. 
 
 Mr. Greene. I know it is, and I realize that situation and also the 
 topographical situation, but what I want to know is this: If we were 
 looking at it from the purely economical viewpoint, would it be 
 desirable to exchange it for a mainland base, or would we get the 
 same economical advantage in having it on an island? 
 
 Gen. Carson. We get an economical advantage, I think, from this 
 location, because it is better water. It is a deeper channel and nearer 
 the mouth of the bay, and land on the mainland is a great deal more 
 expensive than this land. YVe have all the neessary railroad and 
 water facilities. This part of Brooklyn is really a part of Xew 
 York Harbor, and the railroad connections are such that it is just as 
 good as almost any other shipping point on the entire harbor. It 
 is better than any in Xew York City proper. 
 
 Mri Greene. Are there any military advantages in that situation 
 or is that a secondary consideration? Would you place the supplies 
 farther up toward the mouth of the harbor, in view of the possibility 
 of hostilities '. 
 
 Gen. ('arson. This is so near the center of the harbor that it is in 
 that respect just as good as any one at Hoboken or Xew York proper. 
 This point is about 15 miles from Sandy Hook. 
 
 Mr. Greene. So that the question of our friend the enemy trying 
 to monkey with it at long range would not present any serious con- 
 sideration '. 
 
 Gen. Carson. Xo. sir: it is as safe as Xew York City proper. 
 
 Mr. McKenzie. The next item is for the Armv supply base at 
 Charleston. S. C, $159,020. 
 
 Maj. von dem Bussche. That project is known as the Charleston 
 Army supply base, located at Charleston, S. C. The total area in- 
 volved is 1,533.6 acres. It was requisitioned in April, 1918, and no 
 payment on requisition has been made. The improvements consist 
 of six warehouses with tile walls and wood floors, two pierhead 
 houses of same construction, two open storage areas, and 56 ordnance 
 powder magazines, with one ordnance pier shed. The total storage 
 space is 1,800,000 square feet gross, and 1,620,000 square feet net. 
 The improvements amount to $16,500,000 and the total investment is 
 $17,100,000. The recommendation in this case is that payment for the 
 land be made and the acquisition thereby completed in order to pro- 
 tect the Government's improvement investment. 
 
 Mr. McKenzie. This is about 11 miles up the river from Charles- 
 ton? 
 
 Maj. von dem Bussche. I am not quite familiar with it. I have 
 never been there, and I am not familiar with the exact location. 
 
 Mr. McKenzie. The question of its military use will be determined 
 later? 
 
 Maj. von dem Bussche. Yes. sir. 
 
 Mr. Miller. How does the title to the land lie now? Is it requisi- 
 tioned property '. 
 
 Maj. von dem Bussche. Yes, sir. 
 
 Mr. Mtller. Nothing has been paid for it? 
 
 Maj. von dem Bttssctte. No, sir. Under the interpretation that has 
 been made of the law on the subject of requisitions, the fee vests in 
 the United States at the date of the service. 
 
 Mr. Miller. The possession and all that? 
 
REAL, ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 35 
 
 Maj. von dem Bussche. Yes, sir; possession and all that goes at 
 that date. 
 
 Mr. Miller. The Government has strong-armed the man out of 
 his property, and has paid nothing for it? 
 
 Maj. von dem Bussoh. The War Department board of appraisers 
 fixed the amount of the award, which is the figure included in the 
 bill. 
 
 Mr McKenzie. Are the owners satisfied with the award! 1 
 
 Maj. vox dem Bussche. No, sir. 
 
 Mr. McKenzie. They are claiming more? 
 
 Maj. vox dem Bussche. Yes, sir; they are claiming- more. 
 
 Mr. McKenzie. The next item is for the Army supply base at 
 Norfolk. Va., $190,000. 
 
 Maj. von dem Bussche. This project is known as the Xorfolk 
 Army Supply Base, located at Xorfolk, Ya. It has an area of 913.4 
 acres, of which 782.83 acres were acquired in March, 1918, and ap- 
 proximately 35 acres were acquired in May and June, 1919. There 
 are 95.97 acres not yet acquired. The improvements consist of two 
 reinforced concrete piers with one and two story pier sheds, re- 
 spectively, eight 1-story warehouses, railroad storage and classifi- 
 cation yard, having a total of 43.9 miles of track, together with water 
 mains, reservoir, sewer, and electrical system, and appurtenances 
 thereto. The storage space amounts to 2,765,300 square feet gross. 
 or 2,451,305 square feet net. The total land investment amounts to 
 $2,293, 174.91 for land acquired and $230,235 estimated as necessary 
 to complete the acquisition of the land, making a total land invest- 
 ment of $2,523,409.91. The total improvements are valued at $26,- 
 675,000, and that, with the land already acquired, represents a total 
 investment of $29,158,174.91. The recommendation is that the ac- 
 quisition of the land be completed in order to protect the Govern- 
 ment's improvement investment. 
 
 Mr. McKexzie. Is the land in question, and for which you are ask- 
 ing this appropriation to complete the purchase price, that part 
 of the land on which buildings are located or is it vacant? 
 
 Maj. von dem Bussche. Xo, sir. This land is in here [indicating], 
 where the tracks are. Here [indicating] is the track approach to 
 this piece here. This piece of property here [indicating] has been 
 turned over to the Public Health Service or the War Risk Insurance 
 Bureau, and they have here a base hospital. What we have yet to 
 acquire is this portion in here [indicating] indicated by the yellow 
 lines. This indicated by brown lines is property to which we already 
 have the fee-simple title. 
 
 Mr. McKenzie. How much railroad track is included here? 
 
 Maj. von dem Bussche. There are 43.9 miles of railroad track in 
 the classification yard and approaches. 
 
 Mr. McKenzie. Will you have to maintain all of those tracks, or 
 will there be a chance to lease them to a railroad company ? 
 
 Maj. von dem Bussche. So far as I know T the trackage is essen- 
 tial. 
 
 Mr. McKenzie. Where is the main line of railroad ? 
 
 Maj. von dem Bussche. So far as I know the trackage is essen- 
 tial to the post itself. The main line is out here [indicating]. 
 
 Gen. Carson. Whether we use this or lease it, this should go with 
 it as a part of the unit. 
 
3f> REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Maj. von dem Bussche. The part shown in green has been turned 
 over to the Public Health Service. 
 
 Mr. McKenzie. This is built right on the water front? 
 
 Maj. von dem Bussche. Yes, sir. 
 
 Mr. McKenzie. You have two piers? 
 
 Maj. von dem Bussche. Yes, sir. 
 
 Mr. Miller. Are we paying here for some property that has been 
 heretofore turned over to the Public Health Service ? 
 
 Maj. von dem Bussche. Yes, sir. This goosehead piece was a part 
 of the requisitioned property, and that, together with this other area 
 [indicating] has been turned over to the Public Health Service. 
 
 Mr. Miller. The property to be acquired under this provision of 
 the bill has heretofore been turned over to the Public Health Service? 
 
 Maj. von dem Bussche. No, sir; this piece here [indicating] is yet 
 to be acquired. 
 
 Mr. Miller. Can you state approximately what proportion of it 
 was turned over and what proportion will be retained by the Army? 
 I want to know what proportion of it has been heretofore turned over 
 to the Public Health Service. 
 
 Maj. von dem Bussche. About 50 per cent of it was to be retained 
 and 50 per cent has been turned over. 
 
 Mr. Miller. This property has been requisitioned? 
 
 Maj. von dem Bussche. Yes, sir; that is the part [indicating] yet 
 to be acquired by requisition. The other was settled for by pur- 
 chase. 
 
 Mr. Miller. Referring to the owners of this property, are they 
 satisfied or dissatisfied? 
 
 Maj. von dem Bussche. They have not accepted the award. 
 
 Gen. Carson. We think we will be able to make an adjustment 
 with them. 
 
 Maj. von dem Bussche. I am quite confident we will be able to 
 adjust this with them. 
 
 Mr. McKenzie. The next item is for the Army repair depot at 
 New Cumberland, Pa., $92,500. 
 
 Maj. von dem Bussche. This project is known as the interior 
 quartermaster storage depot, located at New Cumberland, York 
 County, Pa. Its area is 941.5 acres, of which 403 acres were acquired 
 in May, 1918. Five hundred and thirty-eight and five-tenths acres 
 of the tract were requisitioned in May, 1918, but has not yet been 
 paid for. The improvements consist of eight fireproof warehouses, 
 two open sheds, a railroad and classification yard, barracks and quar- 
 ters, and water supply mains. The storage space amounts to 1,940,000 
 square feet. The total investment, including the land alreadv paid 
 for, amounts to $4,448,400. 
 
 Mr. McKenzie. Have the owners of this property which has been 
 requisitioned accepted the 75 per cent? 
 
 Maj. von dem Bussche. No sir. 
 
 Mr. McKenzie. And $92,500 represents the full value of it? 
 
 Maj. von dem Bussche. Yes, sir; that represents the full value of 
 it. Four hundred and three acres of it were purchased at a cost of 
 $63,400, and there are 538.5 acres yet to be acquired. This shown in 
 brown [indicating] is what we own. 
 
 Mr. McKenzie. Will you explain a little more in detail where this 
 land is located, or whether it is on a river or bay ? 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 37 
 
 Maj. vox dem Bussche. It is on the Susquehanna River. 
 Gen. Carsox. It is not far from Harrisburg. 
 
 Mr. Miller. How far is it from that tract we were considering 
 yesterday in connection with the race-track proposition? 
 Maj, vox dem Bussche. I do not know. 
 Gen. Carsox. I will put the exact mileage in the record. 
 
 Note. — Twelve miles. 
 
 Mr. McKexzie. How far is it from Harrisburg? 
 
 Maj. vox dem Bussche. I do not know. 
 
 Note. — Three miles. 
 
 Mr. James. What is the value of the improvements upon the land 
 that Ave have not vet paid for? 
 
 Maj. von dem Bussche. I think that a majority of the improve- 
 ments are on the tracts not yet paid for. These big storehouses 
 [indicating] are partially on Government-owned property and par- 
 tially on property not yet Government owned. 
 
 Mr. McKexzie. What is the character of the land! 1 
 
 Maj. vox dem Bussche. I do not know: but, apparently, it is not 
 particularly good land. I am assuming that from the fact that 400 
 acres were acquired at a cost of $63)000. I imagine that it is not the 
 most valuable land in that section of the country. 
 
 Mr. McKexzte. There would be but little chance to lease this 
 property for commercial uses? 
 
 Gen. Carsox. There is no intention of doing that. This is needed 
 as a reserve depot, but, of course, if in the future any space should 
 become surplus, it could be leased. 
 
 Mr. James. Do you require all of that space at the present time? 
 
 Gen. Carsox. Yes, sir. 
 
 Mr. McKexzie. What department has charge of it — the Quarter- 
 master General's department? 
 
 Gen. Carsox. Yes, sir; it is a reserve depot of the Quartermaster 
 Corps. 
 
 Mr. McKexzie. You keep all kinds of Quartermaster supplies 
 there, I presume? 
 
 Gen. Carsox. Yes, sir; and I think supplies pertaining to some of 
 the other departments known as general supplies. I am not positive 
 about that, but I think that all classes of reserve supplies are sent 
 there. 
 
 Mr. McKenzie. The next item is for the Army Reserve Depot at 
 Schenectady, N. Y., $3,000. 
 
 Maj. von dem Bussche. This project is known as the Interior 
 Quartermaster Storage Depot, located at Schenectady, N. Y. It has 
 an area of 231.36 acres, of which 220 acres were acquired in May, 
 1918, and there are 93 lots yet to be acquired. The improvements 
 consist of 8 closed warehouses, 2 open sheds, and 42 small canton- 
 ment buildings. The total storage space amounts to 2,060,000 square 
 feet closed, and 537,600 square feet open. The investment on account 
 of the land already acquired is $88,646.80, and the value of the im- 
 provements is $4,680,000, making a total investment of $4,768,646.80. 
 The recommendation is that the title to the land now 7 under contract 
 be acquired in order to protect the Government's improvement and 
 investment. 
 
38 REAL ESTATE— TO COMPLETE ACQUISITION IN CERTAIN CASE-. 
 
 Mr. McKenzie. Why is it essential to have those few lots? 
 
 Maj. von dem Bussche. Because the improvements are all over 
 them. Here [indicating] are the outside areas, and these are little 
 pieces of property on the inside. These belong to small property 
 owners on the inside. We own the land out to the line there [in- 
 dicating], and this represents the total area. 
 
 Mr. Miller. This little portion | indicating] is not yet paid for? 
 
 Maj. von dem Bussche, That is true. 
 
 Mr. Miller. How about the landowners there? Are they willing 
 to take the award? 
 
 Maj. von dem Bussche. That is purely a question of negotiations. 
 It is a case where the title was bad, and we did not have time to clear 
 it up before the prohibition went into effect. 
 
 Mr. McKenzie, The next item is for the quartermaster depot at 
 Jeffersonville, Ind., $225,000. 
 
 Maj. von dem Bussche. This project is known as the quartermaster 
 depot located at Jeffersonville, Ind. It has a total area ot 261.6 acres, 
 of which 17.4 acres were acquired in 1870, and there are yet to be ac- 
 quired 235.62 acres, bringing the total area up to 261.6 acres. This is 
 one of the old establishments which was simply enlarged. 
 
 Mr. McKenzie. When was this requisition made? 
 
 Maj. von dem Bussche. I do not think it has ever been requisi- 
 tioned. It was under lease, and then they erected these warehouses. 
 They are not trying to buy it. It is held under lease partially, and 
 I do not think it was ever requisitioned. 
 
 Mr. McKenzie. The only thing that, perhaps, makes it necessary 
 to purchase this particular tract at Jeffersonville is because of the 
 transfer of a part of the activities from the Rock Island Arsenal to 
 Jeffersonville. I presume you remember the discussion that came up 
 in the House in regard to that? 
 
 Mr. Miller. Yes ; the Rock Island Arsenal was gutted and a part 
 of it sent down here. 
 
 Mr. McKenzie. Certain activities were transferred from Xew 
 York to Rock Island. 
 
 Gen. Carson. That is one of the big manufacturing depots. 
 
 Maj. von dem Bussche. The improvements consist of various ware- 
 houses of the following classes of construction: Steel : frame, covered 
 with sheet iron ; wood frame, covered with sheet iron ; brick and con- 
 crete ; frame, together with the necessary railroad spur tracks, etc. 
 The total storage space amounts to 3,852.165 square feet. I have not 
 been able to locate the papers in this case, but it appears that the total 
 investment in improvements is $2,732,000. The recommendation in 
 this case is that payment for the land be made in order to protect the 
 Government's improvement investment. It is necessary to protect 
 the investment in those warehouses that have been erected on the 
 leased property. 
 
 Mr. Miller. The warehouses were erected on the property that you 
 want to acquire now ? 
 
 Maj. von dem Bussche. Yes, sir; and that is the reason we want to 
 acquire it. We want to acquire it because of the permanent improve- 
 ments that have been erected on it. 
 
 Mr. Miller. What proportion of the warehouses are on that prop- 
 erty? 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 39 
 
 Maj. vox dem Bttssche. A majority of them. All of this shown in 
 yellow represents new construction, and this shown in red is what 
 we own. 
 
 Gen. Carson. A great deal of space is needed here for storage pur- 
 poses. We have animal-drawn vehicles stored there and also harness. 
 
 Mr. McKenzie. We will pass the next item for the quartermaster 
 warehouse at Baltimore, Mid., until to-morrow. We will take up 
 the item for quartermaster warehouses at Newport News. Va.. 
 $223,670. 
 
 Maj. vox dem BussCHE This project is known as the quarter- 
 master warehouses located at Newport News. Ya. The total area 
 consists of 41.85 acres, which was occupied by a lease in li>17. or in 
 the early part of 1918, at a rental of $3,588.48 per annum. The 
 improvements eonsist of a group of semipermanent warehouses, with 
 concrete floors, frame superstructure, and brick fire walls, together 
 with railroad trackage, concrete roadways, water supply, etc. Noth- 
 ing has been paid for the land. The total storage space amounts to 
 4i J <).()()() square feet under cover. The value of the improvements is 
 $1,995,000, and the total investment would he $2,218,670. The recom- 
 mendation is that the land he acquired in order to protect the Gov- 
 ernment's improvement investment. 
 
 Mr. M< Kexzie. Are these warehouses being utilized by the War 
 Department ? 
 
 Maj. yonjcem Btjssche. No. sir; they are empty. It is simply a 
 question of protecting the investment there. 
 
 Mr. McKexzie Is there any prospect of selling them \ 
 
 Gen. Carson. That is what we are endeavoring to negotiate with 
 the owners of the land at the present moment, hut it has not yet 
 come to a definite conclusion. If we were to dispose of those various 
 improvements, or the warehouse group, which cost us originally 
 nearly $2,000,000, the salvage value would not he 5 per cent. If Ave 
 owned the land, of course, we would have a complete commercial 
 unit that we could either lease or sell; hut if we can not acquire the 
 land, then we must make the best bargain we can with the owners 
 of the land. In our opinion, these warehouses have a good potential 
 value. Warehouse space in that harbor is in great demand, so we 
 are told, and this property could be put to commercial uses. We 
 are endeavoring to come to a satisfactory agreement with the owners 
 to either purchase these improvements at a fair valuation, or, if we 
 can not agree upon such a figure, to lease them from the Government, 
 and we would continue to lease the land. 
 
 Mr. McKenzie. It is a business proposition ? 
 
 Gen. Carson. Yes, sir. We have vacated these two groups [indi- 
 cating] and do not use them any more. 
 
 Maj. vox dem Btjssche. I might say in that connection that the 
 landowners have the War Department practically at their mercy. 
 The foundations and floors in those warehouses are concrete, and we 
 are obligated to restore the land. Therefore, if we have to comply 
 with the terms of the lease it will cost us, in addition to the invest- 
 ment already put in the property, considerably more to take out the 
 concrete piers and floors in the warehouses, whereas if we owned the 
 property we could sell it at a figure more nearly equal to its value. 
 The salvage value of the buildings is said to be in the neighborhood 
 of $250,000, and the improvements cost $1,995,000. 
 
40 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Mr. McKenzie. The next item is for the Artillery range at Toby- 
 hanna, Pa., $7,533.67. My recollection is that there was a very good 
 argument made in favor of that, but, for the benefit of this record, 
 you may make a statement in connection with it. 
 
 Maj. von dem Bussche. This project is known as the National 
 Guard artillery range, located at Tobyhanna, Pa. The total area 
 consists of 21,125 acres, of which 18,91:2 acres were acquired during 
 the period from. January, 1914, to July, 1918, and there are 2,183 
 acres not yet acquired. Data as to the improvements on the property 
 are not available, but they must be very small, consisting of target 
 butts and some small storage buildings. It is not a storage project. 
 The approximate cost of the land already acquired was $56,000 and 
 the cost of the land to be acquired is $7,533.77. 
 
 Mr. McKenzie. Just why do they want this additional tract ? 
 
 Maj. von dem Bussche. It is in order to provide access to the full 
 use of the land already acquired. 
 
 Mr. McKenzie. Have you a map of that area ? 
 
 Maj. von dem Bussche. Yes, sir. The Government's property is 
 indicated in yellow and orange. This [indicating] is the property 
 that we own, and the property that is desired is shown in blue. I 
 presume this is to give access to the property here. 
 
 Mr. Miller. What is this detached piece out here [indicating] 
 for? 
 
 Maj. von dem Bussche. I do not know. It might be well to have 
 a representative from the Militia Bureau to make a statement in 
 regard to that. 
 
 Mr. McKenzie. You may put a little more detailed statement in 
 the record showing why these little tracts are desired. 
 
 Maj. von dem Bussche. I will do so. These tracts are necessary 
 to complete the project from the standpoint of safety, access to the 
 remainder of the property, and similar purposes. 
 
 Mr. McKenzie. The next item is for general hospital No. 19, at 
 Azlea, N. C, $58,000. 
 
 Maj. von dem Bussche. This project is known as General Hospital 
 No. 19, located at Azalea, X. C. The area consists of 375.63 acres, 
 of which 289.24 acres were requisitioned March 6, 1919, and 86.39 
 acres are under contract dated June 25, 1919. The buildings are of 
 the usual hospital type, with a capacity for 1.300 beds. The total 
 cost of the land is estimated to be $57,448.86, while the improve- 
 ments cost $2,668,609. The purpose there is purely one of protect- 
 ing the investment that the Government has made. 
 
 Mr. McKenzie. The Public Health Service is now making use 
 of it? 
 
 Maj. von dem Bussche. Yes, sir. 
 
 Mr. McKenzie. The only interest that the War Department has 
 in it is to perfect its title in order that it may be legally transferred 
 to the Public Health Service? 
 
 Maj. von dem Bussche. Yes, sir. 
 
 Mr. McKenzie. And, of course, to make settlement with those citi- 
 zens with whom they have entered into contracts, as w y ell as to make 
 settlements where condemnation proceedings have been instituted? 
 
 Maj. von dem Bussche. Yes, sir. A part of it is under requisi- 
 tion and a part of it is under contract. It was turned over to the 
 Public Health Service on October 29, 1920. 
 
REAL, ESTATE- — TO COMPLETE ACQUISITION IN CERTAIN CASES. 41 
 
 Mr. McKenzie. The next item is for site for septic tank. Souther 
 Field. Americus, Ga., $750. 
 
 Maj. vox dem Bussche. That is a part of the Souther Flying 
 Field controlled tw the Air Service, located at Americus Ga. The 
 acreage required is 4.6. Souther Field proper consists of 406.68 acres, 
 which was acquired July 5. 1919, at a cost of $32,534.40. The im- 
 provements on this little piece of land consist of the septic tanks for 
 Souther Field, and $750 is the amount estimated as necessary to 
 acquire the land. 
 
 Mr. McKexzie. The septic tanks have been constructed on the 
 land? 
 
 Maj. vox dem Bussche. Yes, sir. The total cost of the improve- 
 ment is $30,000, or that is the cost of the tanks proper. The total value 
 of the improvements at Souther Field is not available to us. 
 
 Mr. McKenzie. The next item is for the Ordnance depot at 
 Savanna, 111., $500. 
 
 Maj. von dem Bussche. This project is known as the Savanna Prov- 
 ing Ground, located at Savanna, 111. The area consists of 13,172 
 acres acquired from July, 1917, to May. 101S. and there are 0.387 acre 
 to be acquired for site and access of observation tower and a part of 
 the proving facilities. 
 
 Mr. McKenzie. We will now take up the item for the Ordnance 
 depot at Pedricktown, X. J., $215,652.90. We will be glad to hear 
 anything you have to say in regard to this item. Mr. Patterson. 
 
 STATEMENT OF HON. FRANCIS F. PATTERSON, Jr., A REPRESENTA- 
 TIVE IN CONGRESS FROM THE STATE OF NEW JERSEY. 
 
 Mr. Patterson. Mr. Chairman, I simply want to urge the com- 
 mittee to retain that. item in the bill. It is a perfectly proper item 
 and a very necessary item. During the war the Government went to 
 Pedricktown, N. J., and seized about 22 farms for the Ordnance De- 
 partment. Those farms were taken over for the use of the Ordnance 
 Department, and the farmers were ousted from their property. 
 Pedricktown grew from a place of 2,500 people to 25,000 people, and 
 they could not get accommodations. They had no money to get other 
 farms with, and they have never had a penny from the Government 
 on account of the taking of their property. Quite a number of suits 
 have been instituted in that connection, and judgment has been re- 
 covered. One judgment in particular was that in favor of James 
 McCrann for $17,272 for real estate and $200 for damage to crops. 
 That judgment was obtained in the United States District Court and 
 was appealed to the United States Circuit Court of Appeals, where 
 the judgment was affirmed, showing that the claims are perfectly 
 proper. These people have been waiting for three years for their 
 money, and they have not received a penny. They are really in 
 distress. 
 
 Mr. McKenzie. While I do not approve of that method of doing 
 business and whether Congress is to blame or the War Department is 
 to blame 
 
 Mr. Patterson (interposing). I do not think that anybody is to 
 blame, or I do not blame anybody. I only ask for speedy action in 
 getting the money to these people who are entitled to it. 
 
42 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Mr. McKenzie. As a matter of fact, this apparent outrage is possi- 
 bly going to work to the good of those particular friends of yours, in- 
 asmuch as the money that they will receive will buy at least one-third 
 more now than if they had invested it at that time. 
 
 Mr. Patterson. That is probably true. 
 
 Mr. McKenzie. Therefore, perhaps they may not be damaged so 
 greatly by having to wait this length of time to get their money. 
 
 Mr. Patterson. I do not think that it was an outrage to take the 
 property, because the Government probably needed it. My only com- 
 plaint is that these people are in distress because they are deprived 
 of the use of their money. I want to urge the committee to retain 
 this item in the bill and get it through as speedily as posisble for the 
 benefit of these people. 
 
 Mr. McKenzie. I wish to say to you that it is the purpose of this 
 committee to get this bill up within a few days, if possible. 
 
 Mr. Patterson. I will not detain you any longer, and I thank you 
 for your courtesy. 
 
 Maj. von dem Bussche. This project is known as the Delaware 
 Ordnan< e reserve depot, located at Pedricktown, Salem County, X. J. 
 It contains 1,540.14 acres and it was requistioned in October, 1918, 
 but not paid for. The improvements consist of a permanent storage 
 establishment, storage buildings, docks, locomotive house, utilities, 
 buildings of permanent construction and housing of temporary con- 
 struction. The items of construction are as follows: Thirty-two 
 ammunition magazines, 346,080 square feet: 53 smokeless-powder 
 magazines, 150,573 square feet: 8 primer and fuse magazines. 2'2.7'2S 
 square feet; 8 general warehouses of temporary type, containing 
 17,063 square feet, or a total area of 536,444 square feet. The im- 
 provements are valued at approximately $3,487,273. 
 
 Mr. McKenzie. This property was requisitioned \ 
 
 Maj. von dem Bussche. Yes. sir. 
 
 Mr. McKenzie. The valuation upon which you base this estimate 
 in the bill is taken from the appraised values? 
 
 Maj. von dem Bussche. It is taken from the appraisals, or that is 
 the amount of the award made by the board of appraisers. 
 
 Mr. McKenzie. Has the 75 per cent been paid in this case? 
 
 Maj. von dem Bussche. No. sir. Whether the landowners have 
 refused to accept it, or whether the prohibition was effective before 
 we had an opportunity to pay them the 75 per cent, I do not know. 
 If it was subsequent to July 11, 1919, we were prohibited from pay- 
 ing the 75 per cent. 
 
 Mr. Greene. Is this regarded by the ordnance people as necessary 
 in their peace-time administration? 
 
 Maj. von dem Bussche. That is a question I can not answer. 
 
 Mr. Greene. That is a question of policy. 
 
 Maj. von dem Bussche. Yes, sir. The recommendation in this 
 case is that the title to the land now under contract be acquired in 
 order to protect the Government's improvements and investment. 
 
 Mr. McKenzie. The next item is for sewer right of way for hous- 
 ing project, Bethlehem, Pa., $275. 
 
 Maj. von dem Bussche. That is part of the project of the Bethle- 
 hem Steel Corporation. It is necessary to acquire a right of way for 
 
REAL, ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 43 
 
 a sewer, and the ground was acquired in May, 1918. This is a claim 
 for damage for sewer right of way in connection with housing facili- 
 ties on ordnance contract with the Bethlehem Steel Co. The contract 
 has been closed and the housing facilities disposed of, but the award 
 in condemnation for damages sustained remains. The recommenda- 
 tion is that the title to the land now under contract be acquired in 
 order to protect the Government's improvement investment. 
 
 Mr. McKexzie. That $275 represents a judgment '. 
 
 Maj. von hem Bussche Yes, sir; a judgment. 
 
 Mr. McKexzie. The next item is for the Aberdeen Proving 
 Ground, Md., $174,591.63. 
 
 Maj. vox dem Bussche. This project is known as the Aberdeen 
 Proving Ground, located in Baltimore and Harford County, Md. 
 The area consists of approximately 35,000 acres. The acquisition 
 began in October. 1917, and has not yet been completed. Approxi- 
 mately 100 acres have not as yet been paid for. The improvements 
 consist of barracks, officers'' quarters, administration buildings, 
 offices, warehouses, proving grounds, I tombing fields, etc. The in- 
 vestment amounts to $7,000,000 appropriated by the act approved 
 October 6, 1917. The appropriation was increased to $8,480,000 by 
 act approved July 8, L918. From the foregoing appropriations 
 $3,563,503.20 has been allotted for procurement of land and payment 
 of damages in connection therewith. Of these allotments. $74,591.63 
 remains unexpended. In addition to this unexpended balance, it 
 would require approximately $100,000 to complete the purchase of 
 land and pay land damage claims. It is understood that practically 
 all of the balance of the appropriation has been expended for build- 
 ings and improvements. 
 
 Mr. Miuler. What damage claims come within that category? 
 
 Maj. vox dem Bussche. Crop damages, damages to fences, etc. 
 
 Mr. McKexzie. That would not be a proper charge to be carried in 
 a bill of this character, would it \ 
 
 Maj. vox OEM Bussche I think it would: yes. sir. We are under 
 obligation to complete the purchase of that property. 
 
 Mr. McKexzie. This is for crop damages on land that you pur- 
 chased '. 
 
 Maj. vox dem Bussche. Yes. sir: and in addition to the $100,000 
 we also need to have made available the $74.591. 63 left, which, of 
 course, was no longer available after the passage of the act of July 11, 
 1919. 
 
 Mr. McKexzie. How much of this $174,591.63 is for the payment 
 of the purchase price of land and how much for damages \ 
 
 Maj. vox dem Bussche. I can not say. That is the amount esti- 
 mated as necessary to complete everything, the purchase price and 
 the damages. 
 
 Mr. McKexzie. Could you put in the record a little more detailed 
 information in regard to that ? 
 
 Maj. vox dem Bussche. I will do so. About $91,000 for damage 
 claims ; remainder for purchase and title examination. 
 
 (Thereupon the subcommittee adjourned until to-morrow, Wed- 
 nesday, May 25, 1921, at 10 o'clock a. m.) 
 
44 REAL ESTATE TO COMPLETE ACQUISITION IjST CERTAIN CASES. 
 
 Subcommittee or the 
 Committee on Military Affairs. 
 
 House of Kepresentatives, 
 
 Wednesday, May 25, 1921. 
 The subcommittee met at 10 o'clock a. m., Hon. John C. McKenzie 
 (chairman) presiding. 
 
 STATEMENTS OF HON. CHARLES E. FULLER, A REPRESENTATIVE 
 IN CONGRESS FROM THE STATE OF ILLINOIS; BRIG. GEN. J. M. 
 CARSON, CHIEF OF CONSTRUCTION SERVICE, OFFICE OF THE 
 QUARTERMASTER GENERAL; AND MAT. C. F. VON DEM BUSSCHE. 
 
 Mr. McKenzie. As I understand it. Mr. Fuller, you desire to have 
 this bill, H. E. 0311, incorporated as an amendment to the bill that we 
 are now considering ' 
 
 Mr. Fuller. I will be very glad, Mr. Chairman, to have that done. 
 This is H. K. 6311, authorizing the Secretary of War to dismiss con- 
 demnation proceedings and to negotiate new leases for or to purchase 
 certain tracts of land at Camp Grant, Winnebago County. 111. The 
 owners of the land in question have sent in a petition, as follows : 
 
 The undersigned are owners oi' a total of 588 acres which are now being used 
 under lease by the Government as a part of Camp Grant. 
 
 The lands are known as the J. August Johnson land, Baldwin land, and Sam- 
 uelson land, which are referred to in detail later. 
 
 Your petitioners represent that the Government is attempting to condemn the 
 fee to said land, and have ottered to pay the owners a sum of money which the 
 owners believe in am event is not full compensation, but the owners desire to 
 keep their land and not to sell it nor have it taken away from them. 
 
 The object of this petition is to .net relict in two respects: First, temporary 
 relief; second, permanent relief. 
 
 The temporary relief is based upon the fact that the district attorney of the 
 northern district of Illinois is about to call up the condemnation proceedings for 
 trial. These condemnation proceedings were hied June 30, 1919. 
 
 The owners believe that upon a careful study of the situation it will be found 
 that the lands owned by them are not necessary for use as a part of Camp Grant, 
 and that it will be found by the Government that it does not desire to have the 
 same. 
 
 The temporary relief asked, therefore, is that the proper officers be directed to 
 instruct the Department of Justice to temporarily hold up the condemnation pro- 
 ceedings until a full investigation can be made by the Government. The per- 
 manent relief asked will be found at the close of this petition. 
 
 There is a plat attached to this petition which shows the location of the va- 
 rious pieces of land above mentioned. The J. August Johnson land is shown 
 as No. 1. the Baldwin land as No. 12, the Samuelson land as No. 3. 
 
 I do not think that I need to go into all of this. I have here a plat 
 of Camp Grant, showing the location of these lands. They are wholly 
 unnecessary for use in connection with the camp, except that, perhaps, 
 a small part of one of the tracts where the waterworks are located 
 may be necessary. 
 
 Mr. McKenzie. My understanding is that the water plant is down 
 there [indicating] in the extreme corner of this particular tract. 
 
 Mr. Fuller. That is correct, I think. 
 
 Mr. McKenzie. That is, down next to the river. 
 
 Mr. Fuller. Yes 
 
 Mr. Miller. Where is the Government's property? 
 
 Mr. Fuller. This comes up near the city limits of the city of 
 Rockford. 
 
REAL, ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 45 
 
 Mr. Miller. How many acre- arc there in the Johnson tract? 
 
 Mr. Fttllbr. The northern part there is the Johnson tract. The 
 J. August Johnson land is located at the extreme northern end of 
 that part of the area that had been used under lease in connection 
 with Camp Grant. This land is 1 mile south of the southern city 
 limits of the city of Eockford. It adjoins land that is platted into 
 town lots adjacent to the city of Eockford. It consists of 233 acres, 
 the fee to which the Government is endeavoring to condemn. 
 
 Mr. Miller. That is the first tract \ 
 
 Mr. Fuller. Yes. Some of this Johnson tract of land, by reason 
 of its ideal location along- the river, is worth from $1,000 to $1,500 per 
 acre, and the remainder of the land, by reason of the proximity of 
 the factory district, is exceedingly valuable. 
 
 Air. McKenzie. It is true that the great manufacturing district 
 of Eockport lies right off to the northeast ( 
 
 Mr. Fuller. Yes. 
 
 Mr. Miller. How large a place is Rockfordl 
 
 Mr. Fuller. It has about 60,000 population, and land is very 
 valuable in there. 
 
 Mr. Miller. There are 233 acres in the Johnson tract. Which 
 is the next tract \ 
 
 Mi'. Filler. The Baldwin land is located as shown upon the 
 plat, immediately to the south of the Johnson land above mentioned, 
 and joins the same, but extends east to the Meridian Road, and with 
 the Johnson land forms a part of the northernmost end of the 
 cam}), being that part of the camp next to the city of Eockford. It 
 is located .1(10 rods south of land that is platted into town lots im- 
 mediately adjacent to the city of Eockford. This land is made up 
 of four 44-acre tracts end to end, east and west, extending from Rock 
 River easterly to the Meridian Road, which is a state-aid cement 
 road, and which adjoins it on the east. 
 
 There is also another State-aid cement road running through the 
 land. The tract consists of 162.94 acres. 40 acres of which has 76 
 rods river frontage on Eock River, causing the land to be exceed- 
 ingly valuable, being worth from $1,000 to $1,500 per acre. The 
 remainder of the land is excellent farm land located in the near 
 proximity of Eockford. which makes it worth from $600 to $800 
 per acre. There is one set of farm buildings on this land in ex- 
 cellent condition, some of which buildings were new when the camp 
 took possession of the land. The buildings are conservatively esti- 
 mated to be worth $12,000. Two railroads cross the land. The 
 Government has had the land under lease since 1917, and has oc- 
 cupied it up to the present time. The principal activities of the 
 camp now take place south of the land in question. There are on 
 the land 86 barracks, 7 wagon sheds, 4 warehouses, 24 small living 
 quarters, 79 latrines, and like small sheds. These buildings are 
 temporary structures, have no foundation, being mostly set on 
 posts. The warehouses, however, have concrete piers about 12 
 inches square. 
 
 Mr. McKenzie. What is the third tract? 
 
 Mr. Fuller. The third tract is the Samuelson land. This tract 
 of land consists of a square 160 acres and a square 40 acres in addi- 
 tion thereto, the actual acreage being about 193.09 acres. This land 
 is the best piece of farm land in Winnebago County. There is not 
 
46 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 a foot of waste land upon it; it is within 240 rods of land that is 
 platted into town lots adjacent to the city of Rockford and because 
 of its proximity is worth $600 per acre. This value is arrived at 
 from opinions of people who are familiar with the value of it and 
 from computations of the value of crops raised upon the farms. 
 
 Along the west side of the land there are two railroads, and along 
 the east side there is a State-aid concrete road and on the north side 
 of the 160 acres and on the south side of the 40 acres there is a 
 macadamized road. The farm has one complete set of farm build- 
 ings valued at $10,858. These lands are now occupied as a part 
 of Camp Grant, being held under a lease executed in 1917. which 
 lease is yet in full force and effect. The Government has, all told, 
 20 buildings on the Samuelson farm. Xone of them is large and 
 some of them are quite small and insignificant, and all are of tem- 
 porary construction. Four of these buildings are now being used 
 to store unused cots, five aie being used by families, and the re- 
 mainder are unused. This land itself was used last year as polo 
 grounds for persons connected with the Army. The 40 acres was at 
 one time used as a lumber yard, but the lumber has all been removed 
 and there is a small quantity of coal now on the land. 
 
 Referring to the whole body of land, the above tracts of land 
 adjacent to each other constitute a compact area in the noithern- 
 most extremity of the land that has been used under lease at Camp 
 Grant. The Government owns no land north of the Johnson tract 
 and no land north of any of these tracts, except 74 acres known as 
 the Larson tract. This land, however, can be disposed of at any 
 time for more than double the amount the Government paid for it. 
 
 The activities of Cam]) Grant are confined almost exclusively to 
 the areas south of the above tracts of land and there are south of 
 the above tracts of land, and composing and for the use of Camp 
 Grant, approximately 3,337 acres of land. 
 
 South of the land now composing Camp Grant there are many 
 acres of land, which, in an emergency, can be used as a part of 
 Camp Grant, the land being worth not over a quarter of what the 
 above lands are worth. 
 
 The owners of the land above mentioned desire not to sell their 
 land at any price, but they are willing to lease the same to the 
 Government if it is found necessary to use the same as a part of 
 Camp Grant. 
 
 The bill also provides that the Secretary of War be given authority 
 to take leases for the lands or any part of them necessary for the 
 protection of the Government, to require the removal of any build- 
 ings thereon, and for the protection of water mains, etc. 
 
 Mr. McKenzie. I notice also that the bill provides — 
 
 That the owners of said tracts of land, prior to the dismissal of all le^al 
 proceedings now pending, shall enter into contract and agreement with the 
 War Department covering all rights of removal of Government property at 
 the expiration of the lease, if not removed before the expiration of the lease: 
 and also for the protection of the Government in relation to any water mains 
 or sewer pipes which may cross any portion of said land. 
 
 Mr. Fuller. I think that the rights of the Government in con- 
 nection with those matters are fully preserved by the bill. 
 
 The permanent relief that these petitioners desire is that the 
 boundary of Camp Grant be changed so as to exclude therefrom the 
 
REAL, ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 47 
 
 lands above mentioned, except so far as the waterworks are con- 
 cerned, and the Baldwin heirs will make such reasonable arrange- 
 ments with the Government for the continuation thereof as may be 
 desired and agreed upon. They further desire that the rent which 
 is now due be paid to the petitioners immediately. There is now due 
 from the United States Government to J. August Johnson, as rent 
 for his land occupied by the Government under lease from July 1, 
 1919, to July 1. 1921, the approximate sum of $9,320. There is now 
 due from the Government to Sarah J. Baldwin, for the use of the 
 Baldwin tract above mentioned under lease, the approximate sum 
 of $6,517.60 from July 1, 1919. to July 1. 1921; and there is now 
 due Charles Samuelson. for rent of the above lands by the Govern- 
 ment under lease, the approximate sum of $7,720 from July 1, 1919, 
 to July 1, 1921. Interest should be computed on the deferred pay- 
 ments of rent at the legal rate. These people have been kept out of 
 their lands and turned out of their homes, and have not even been 
 getting rent for the last two years. 
 
 Mr. McKenzie. I would like to ask Gen. Carson or Map von dem 
 Bussche if it has not been the policy of the Government where con- 
 demnation proceedings were pending, or where the requisition of 
 lands had been made, not to figure or pay rent from the time that 
 such proceedings are commenced, but that the obligation for the land 
 is fixed at the time of the filing of the condemnation proceedings, 
 covering all the claims of the owners ? 
 
 Gen. Carson. Yes, sir; that is correct. 
 
 Mr. McKenzie, If the lands are condemned they would get the 
 price fixed by the jury, but they would not recover any rental from 
 the time the Government took possession. 
 
 Mr. Fuller. Suppose the land doubled in value from the time the 
 proceedings were commenced until the time the judgment was entered, 
 would the Government get the land at its value when the proceedings 
 were commenced? 
 
 Mr. Miller. Yes ; that is the universal rule. 
 
 Mr. Greene. It would double in value because the Government 
 wants it. 
 
 Mr. Fuller. Here it is due to the growth of the city. 
 
 Mr. Greene. But two years' growth of the city would not double 
 its value. 
 
 Mr. Fuller. I did not say that it doubled it, but suppose it did 
 double it. The land is becoming more and more valuable as the city 
 extends out in that direction. 
 
 Mr. Greene. But the purchase is as of the time when the minds met. 
 
 Mr. Fuller. They have been kept out of their lands for two years, 
 and no one has been paid rent for it or anything else. 
 
 Mr. McKenzie. You have lived all your life in that vicinity or over 
 in the adjacent county of Boone? 
 
 Mr. Fuller. Yes. 
 
 Mr. McKenzie. And when you were circuit judge you held court in 
 the city of Rockford, and are familiar with the surrounding country 
 there. What is your honest judgment as to the military necessity for 
 retaining these various tracts of land ? 
 
 Mr. Fuller. I do not think there is any necessity whatever for it. 
 I think they already have more land there than they ought to have 
 
 50916—21 i 
 
48 REAL, ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 without this. I would personally go a good deal further than that 
 and say that 97 per cent of the people there would be glad if the 
 camp might be abandoned. That applies not only to people in the 
 vicinity of Rockford but to the people all around for 25 or 30 miles. 
 
 Mr. Miller. For what reason? 
 
 Mr. Fuller. Crime in the vicinity of Rockford has increased 
 enormously. 
 
 Mr. Miller. It has in most cities. 
 
 Mr. Fuller. It has there. In time of peace the people that are 
 confined in the camps are not just like the volunteers that you had 
 during the war. Hardly a day passes there but what some crime is 
 committed in that vicinity, and soldiers from the camp are arrested 
 and charged with the crimes. 
 
 Mr. Greene. You sa}^ they are arrested and charged with the 
 crimes, but do the soldiers arrested and charged with crimes represent 
 any greater percentage or a greater proportion than the civilians off 
 the reservation who are arrested and charged with crimes? 
 
 Mr. Fuller. I do not know. For some reason or other there has 
 been a very great increase in crime in that vicinity. 
 
 Mr. Miller. This property has increased in value, or has nearly 
 doubled in value? 
 
 Mr. Fuller. Of course, a great deal of property has increased in 
 value because of the Government's locating the camp there. The 
 city of Rockford had more growth undoubtedly when the camp was 
 fully occupied; but times are different now, and there is not a great 
 number of men there. The buildings are falling down. They are 
 temporary buildings and unpainted. 
 
 Mr. Greene. You say that the soldiers who are there now are not 
 like the war-time volunteers who were there ? 
 
 Mr. Fuller. I do not want to go into that. 
 
 Mr. Greene. But it may be very pertinent to this discussion, if 
 this camp, instead of enhancing the value of property, is a detri- 
 ment to the community. 
 
 Mr. Fuller. Some property has enhanced in value undoubtedly 
 because of the camp being located there, but the city has grown out 
 in this direction, and, undoubtedly, if the camp were abandoned 
 that whole area there would be occupied very soon by the manu- 
 facturing industries of Rockford. A good many people have un- 
 doubtedly made considerable money out of real estate speculations in 
 that vicinity, but the great majority of the people of Rockford are 
 not interested in those matters. 
 
 Mr. Greene. If there is a real moral menace to the community, 
 then it is not merely a question of real estate values. 
 
 Mr. Fuller. I got my information on that matter from the sheriff 
 of Winnebago County, and he was very emphatic upon the proposi- 
 tion that the camp is a menace to the people of Rockford. 
 
 Mr. Greene. You have been so familiar with court procedure and 
 the illogical way in which some people seek to give an explanation 
 of such circumstances that you will readily appreciate the other side 
 of it, You have probably seen accounts of crimes around about 
 military camps in the newspapers, and the headlines frequently read, 
 " Ex-service man guilty of forgery," or " Ex-service man commits 
 murder." Of course, the impression that is produced on the average 
 
REAL ESTATE TO COMPLETE ACQUISITION IN" CERTAIN CASES. 49 
 
 mind is that somehow or other everybody in the Army is a bad lot. 
 That impression prevails until people stop and call attention to the 
 fact that the Army was made up under the selective-service act and 
 is composed of the same material that we find in civil life. Now, 
 when things are charged up that way to the armed forces, and they 
 are referred to as a moral menace, I have seen enough of military 
 men as compared with civilians to want to see the figures. 
 
 Mr. Fuller. I do not know how that may be. but they are very 
 emphatic in those statements. I do not know that they are worse 
 than anybody else, but, as you know, the devil is busy finding mis- 
 chief for idle hands to do. I may not quote it exactly, but there is 
 a saying of that kind that is very true. When they are idle at the 
 camps, or have not very much to do, they are liable to get into 
 mischief. 
 
 Mr. Greene. Is it true that they do not have much to do at this 
 camp ? 
 
 Mr. Fuller. They seem to get leave whenever they want it, and I 
 see them around town. 
 
 Mr. Greene. There, again, is it the same man that is always get- 
 ting leave, or is it simply that you see a man in uniform in town? 
 That simply represents some soldier on leave. How many men are 
 in the garrison on the reservation? 
 
 Mr. Fuller. I do not know, but it is a very small number com- 
 paratively. I rode through there last fall and I think at that time 
 nine-tenths of the buildings were vacant. The most that I observed 
 there where there was anything doing was a very large field out on 
 one side where there were several thousand horses. 
 
 Mr. Greene. When the people in the community adjoining a camp 
 see somebody in uniform every day, that may create the impression 
 that everybody is on leave, or they get the impression that they see 
 the same men every day on leave, but, as a matter of fact, the indi- 
 vidual man may not get leave except at intervals of several days. 
 
 Mr. Fuller. I understand that. 
 
 Mr. Greene. How much of that condemnation of the military 
 forces at these camps do you believe results from a careful considera- 
 tion of the facts, or how much of it is founded on fact ? 
 
 Mr. Fuller. I can not say how much of it there is. The sheriff of 
 the county was very emphatic in the idea that crime had increased 
 in the community there. He was the man who w r as looking after 
 those things and knew about the crimes that were being committed. 
 Rockford has been in the past as free from crime or anything of that 
 kind as any city in the world. It has been almost a model town. 
 Of course the increase in population makes a great deal of difference, 
 and the large increase in manufacturing industries makes a difference. 
 
 Mr. Miller. On that question of the camp being unwelcome there, 
 in my own State one county bonded itself to the extent of $2,500,000 
 to buy 88,000 acres of land for a camp. That is Camp Lewis, and my 
 own county bonded itself to the extent of $500,000 to purchase tracts 
 of land for aviation purposes. 
 
 Mr. Fuller. I have done a good deal of work myself in connection 
 with Camp Grant, and I had not intended to say anything about the 
 abandonment of the camp. What I am interested in now is this bill 
 for the relief of these landowners. 
 
50 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASE >. 
 
 Mr. McKenzie. You are in favor of doing away with all unneces- 
 sary expenses in connection with the camp without abolishing the 
 camp itself? 
 
 Mr. Fuller. Yes, sir. With the amount of land that they already 
 own there I do not think they need any more. I do not think they 
 need any more land or that they ever will need any more unless there 
 is another war and the camp should be used for a large number of 
 men. 
 
 Mr. McKenzie. What do you say in regard to this statement, that 
 land south of the camp could be purchased ? 
 
 Mr. Fuller. The land at the south end is nothing but ordinary 
 farm land, worth probably from $200 to $250 per acre. It is not 
 worth anything like this land up near the city. 
 
 Mr. Greene. They could always get this land in an emergency, 
 anyway ? 
 
 Mr. Fuller. Yes, sir; surely. There is no question about that, 
 and there would be no trouble about buying land at the south end. 
 These people have been turned out of their homes and have been 
 left without anything for two years now. 
 
 Mr. Miller. Let me ask you a few questions in relation to this 
 Johnson site of 233 acres : Prior to the war was that exclusively 
 agricultural land? 
 
 Mr. Fuller. I think it was ; yes, sir. 
 
 Mr. Miller. There are 233 acres in that tract? 
 
 Mr. Fuller. Yes, sir. 
 
 Mr. Miller. And that land was devoted purely to agricultural 
 purposes ? 
 
 Mr. Fuller. I think so, before the war. 
 
 Mr. Miller. Take the second tract, or the Baldwin tract. 
 
 Mr. Fuller. That was just the same. It was farm land. It was 
 used for nothing but farms. 
 
 Mr. Miller. And the Samuelson tract — was that farm land, also ? 
 
 Mr. Fuller. Yes. 
 
 Mr. Miller. And a railroad line crosses this tract north and 
 south ? 
 
 Mr. Fuller. Yes. 
 
 Mr. Miller. And it runs along the west side of the Samuelson 
 tract? 
 
 Mr. Fuller. Yes. 
 
 Mr. Miller. Was that track constructed before the war? 
 
 Mr. Fuller. Yes. 
 
 Mr. Miller. Is it the main line of some railroad ? 
 
 Mr. Fuller. No ; it is not a main line, but it is a road that has been 
 constructed there for a number of years. It runs down to Joliet. 
 It is called the Milwaukee & Gary Railroad. I think. 
 
 Mr. Miller. There has been no extra trackage placed on any of 
 these tracts of land by reason of the camp activities there '. 
 
 Mr. Fuller. No. 
 
 Mr. Miller. Have you been on this tract of land, or the Johnson 
 tract? 
 
 Mr. Fuller. I have been down that street, or down that paved 
 street. 
 
 Mr. Miller. What is the character of the Army buildings erected 
 on the Johnson tract ? 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 51 
 
 Mr. Fuller. On this land there was constructed when the camp 
 was made a total of 21o buildings. There were 131 barracks and 
 sheds adjoining, 77 hospital buildings. 11 warehouses, 1 Eed Cross 
 building, 1 chapel, and 1 Y. M. C. A. building. None of the barracks 
 is now in use. About 60 of the sheds are being used ; 20 of the hos- 
 pitals are in partial use; all of the warehouses are in partial use; 
 and the chapel, Red Cross, and Y, M. C. A. buildings are all still 
 being used. 
 
 Mr. Miller. What buildings of a military character were erected 
 on the Baldwin tract outside of the pumping station? 
 
 Mr. Fuller. There are in all on the land 86 barracks, 7 wagon 
 sheds, 4 warehouses, 24 small living quarters, 79 latrines and like small 
 sheds, These buildings' are temporary structures, have no founda- 
 tions, being mostly set on posts. The warehouses, however, have 
 concrete piers about 12 inches square. Of the buildings above men- 
 tioned, 60 of the barracks are being partly used as living quarters 
 and 20 are not used at all. Of the wagon sheds, all seven are in use 
 for storing old wagons. The sheds are about to fall down. Three 
 warehouses are in partial use, and one is not used at all. The entire 
 24 small living quarters are being occupied, and a very small part of 
 the latrines and like small sheds are being used. 
 
 Mr. Miller. Now, as to the Samuelson tract? 
 
 Mr. Fuller. The Government has, all told, 20 buildings on the 
 Samuelson farm. None of them is large, and some of them are quite 
 small and insignificant. All of them are of temporary construction. 
 Four of those buildings are now being used to store unused cots, five 
 are being used by families, and the remainder are unused. The land 
 itself was used last year as a polo grounds by persons connected with 
 the Army. Forty acres were at one time used as a lumber yard, but 
 the lumber has all been removed, and there is a small quantity of 
 coal now on the land, which has been dumped there. 
 
 Mr. Miller. Camp Grant is a camp that was installed at the be- 
 ginning of the war? 
 
 Mr. Fuller. Yes. The chairman or any member of the investigat- 
 ing committee that visited Camp Grant knows a great deal about it 
 and perhaps fully as much as I do, or more. 
 
 Mr. McKenzie. Gen. Carson, do you care to say anything about 
 this Camp Grant project at this time? 
 
 Gen. Carson. I am not prepared to go into it extensively, but T 
 would like to say that the petition that Mr. Fuller has just read to 
 the committee was presented to the Secretary of War some time ago, 
 and it has been referred to the commanding general at Camp Grant 
 for his recommendation as to the necessity for these particular tracts 
 of land for military purposes. That report has not yet been re- 
 turned. 
 
 Mr. Miller. Do you recall when the report was referred! 1 
 
 Gen. Carson. It left the Quartermaster General's office, I should 
 say, two weeks ago. 
 
 Mr. Miller. Who is the commanding general at Camp Grant? 
 
 Gen. Carson. Gen. Bell. 
 
52 REAL ESTATE TO COMPLETE ACQUISITION IN" CERTAIN CASES. 
 
 STATEMENTS OF MR. WALTER B. BROOKS, PRESIDENT; MR. J. 
 HOWARD SUTTON, CHIEF ENGINEER; AND MR. HARRY N. BAET- 
 JER, ATTORNEY, CANTON CO., OF BALTIMORE, MD. 
 
 Mr. McKenzie. We will take up the item for the quartermaster 
 warehouse at Baltimore, McL, $100,000. We will be glad to hear 
 anything that you gentlemen have to say in regard to this item. 
 
 Mr. Baetjer. Mr. Chairman, if I may be permitted to make a 
 short statement I will do so, and Mr. Brooks will go more into the 
 details. Mr. Brooks is the president of the Canton Co., of Balti- 
 more ; Mr. Sutton is the chief engineer, and I am the counsel. The 
 Canton Co. of Baltimore is the owner of a large tract of land upon 
 the outskirts of Baltimore, a part of which it has developed with 
 warehouses, docks, and pier improvements, and it owns and operates 
 a railroad, known as the Belt Railroad, entirely around the city of 
 Baltimore. It is the largest owner of warehouse, storage, and termi- 
 nal facilities at the port of Baltimore, and during the war over 40 
 per cent of the trans- Atlantic traffic went over its piers. 
 
 In the spring of 1918 the Government came to the Canton Co. of 
 Baltimore and said that they wanted some land for warehouse pur- 
 poses for the Quartermaster Department. They wanted to lease the 
 ground, and they leased it at their own figures. On that land that 
 they leased they erected in 1918 or in the spring of 1919 four big 
 frame warehouses with concrete bases. They put in the necessary 
 sides, and the buildings were about 1,000 feet long and about 200 
 feet wide, the warehouse spaces' being separated by the usual brick 
 partitions for protection against fire. They cost a lot of money, be- 
 cause a lot of the work had to be done twice. They had to be rebuilt, 
 due to the fact that they were built during the severe freezing 
 weather of 1918. Some of the flors had to be laid twice on that ac- 
 count. In 1919 the Government came along and said that they wanted 
 some warehouses, and that they would requisition them. The Canton 
 Co. protested against that. Nothing further was done until the 
 spring of 1919, when the Government came back and said, " We will 
 take over these warehouses, and if you want to present any evidence 
 about the values you can present it; but we have made up our 
 minds that we need them." 
 
 Mr. Miller. How many acres of land were involved? 
 
 Mr. Baetjer. Roughly, 36 acres. We then came over here to see 
 the Government. We first took it up with Col. Collins, who was the 
 quartermaster in charge over there at that time, or in charge of that 
 entire zone or district. We were referred by him to the real estate 
 service department of the Quartermaster Department, and we came 
 to a conclusion with them. The Government said that they did not 
 want them, but that they wanted to protect their investment. They 
 said that if they could protect their investment they would get out of 
 them. We said, "All right ; we will make an arrangement by which 
 we can buy them." We came to a conclusion with Mr. Hubbard, of 
 the real estate department, subject to the approval of his superiors. 
 Mr. Hubbard's superiors did not, however, adopt his suggestions. At 
 the end of those negotiations we took the matter up with Col. von 
 dem Bussche, and we thought that we would come to a satisfactory 
 conclusion, but we split in these negotiations upon the question of the 
 
REAL ESTATE— TO COMPLETE ACQUISITION IN CERTAIN CASES. 53 
 
 amount of interest to be paid on the deferred payments It was a 
 very small question, and did not involve a large amount, but at any 
 event the plan did not go through. The objections that we make to 
 it and the reason why we ask that this committee seriously consider 
 whether this money should be appropriated are two : In the first place, 
 the Government in their statements to us showed that they did not 
 want this property, and their last statement was that they would be 
 willing to turn the whole thing over on July 1 1921, and subsequently 
 they stated that they could turn them over before the end of this 
 year Thev are frame warehouses and have been constructed for 
 three years They are on concrete bases or foundations, but are 
 frame superstructures. They were used for storage purposes by the 
 Quartermaster Department, so that they would be readily accessible 
 to the water front in making their shipments. _,,,.,,, . 
 
 Now these warehouses occupy a strip of land of the length of six 
 city blocks, and it is so located as to cut our property in halt, Im- 
 mediately south of them, there are only 957 feet of head room be- 
 tween there and the water front. There is not sufficient room in there 
 for storage, warehouse, and shipping facilities As I have said they 
 cut our land in half for that tremendous length. The effect of ! that 
 is to destroy the development at that point of the port of Baltimore^ 
 and that is where the development must be made if the city is to go 
 forward The last warehouse we put up in there was built at a 
 cost of $2,000,000, and because of the fact that these warehouses are 
 in there; occupying that strip, there are only about 951 feet o head 
 room for that warehouse at the water front. As I have said, 40 per 
 cent of the traffic to Europe goes through our storage warehouses 
 and over our docks and piers, and we operate the Belt Railroad clear 
 around the city of Baltimore, with the storage warehouses and all 
 the things that go with them in the way of loading and unloading. 
 The Pennsylvania Railroad Co., with property immediately west of 
 our warehouse, in order to get the necessary trackage facilities in 
 connection with one grain elevator, have something like eight city 
 blocks of head room, but if this bill goes through, a 1 of these ware- 
 houses of the Canton Co. located there will have only two blocks of 
 head room for the operation of its trackage and other facilities in 
 connection with those warehouses. _ 
 
 While that situation is primarily important to the Canton Uo. it 
 is also a matter of very serious importance to the city ot Balti- 
 more, because if these warehouses remain there they will mteriere 
 greatly with the future development of the port. It it were a ques- 
 tion of necessity, or if these were permanent storage warehouses built 
 of concrete, or anything of that kind, there might be some justification 
 for it, but that is not the case here at all. As I have said, we were in 
 negotiation with the Government for the acquisition of this property 
 and at the time they were broken off, we were only about $2o,000 
 apart. AVe split upon the question of interest on deferred payments, 
 or the rate of interest on deferred payments. The Government said 
 "We will deliver them July 1, 1921." We say, if that is true, they 
 have no need for them. We 'believe, further, that if there is a loss, and 
 naturally, there will be a loss, that loss is one that should be charged 
 to the war. Of course there was a big loss in nearly everything that 
 was done by the Government during that time. The Government s 
 
54 REAL ESTATE- — TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 figures show an investment of something like $1,900,000, but a great 
 deal of that construction work was done twice, as I have explained, 
 and I think that is something that should be charged against the war. 
 
 Mr. Miller. What was on this land when the Government took 
 possession of it? 
 
 Mr. Baetjer. Nothing ; it was bare land clear down to the water's 
 edge. The map will show that our development is 200 feet west of 
 this. 
 
 Mr. Miller. What land do you own to the right and left it ? 
 
 Mr. Baetjer. We own a considerable tract to the left. That is a 
 tract of vacant land going south toward Sparrows Point, where the 
 plant of the Bethlehem Steel Corporation is located. To the west 
 we own isolated tracts. We own a warehouse over there, and next to 
 that comes the Pennsylvania Railroad's grain elevator. To the west 
 of that the ground is in miscellaneous ownership. 
 
 Mr. McKenzie. What was the amount of the consideration asked 
 by the Government ? 
 
 Mr. Baetjer. $300,000. 
 
 Mr. McKenzie. For what purpose did you intend to use it \ 
 
 Mr. Baetjer. We thought that we would try to divert some tobacco 
 storage warehousing in there and try to make it pay, or we figured 
 that we could lease them out in small lots under contracts that we 
 could terminate shortly. These buildings are of frame construction. 
 
 Mr. McKenzie. Is your company still of the same mind, or are 
 you willing to pay the $300,000 ? 
 
 Mr. Baetjer. I think you must appreciate that negotiations made 
 to-day must be different from negotiations made last June, but we 
 are willing to go into negotiation with them now. If we have to lose 
 money, then we will have to lose it. It would be better to lose money 
 than to have this situation that so seriously interferes with the port 
 development at Baltimore. 
 
 Mr. McKenzie. In your statement with regard to the location of 
 these warehouses, you referred to the detrimental effect that they 
 would have upon the operations of your company, and to the fact 
 that they interfered with other developments there. Now, that situa- 
 tion would be just the same to-day as it was a year ago or two years 
 ago. 
 
 Mr. Baetjer. We would be getting some salvage out of them, or 
 we would hope to do so. In 1919 our warehouses and other storage 
 and port facilities were full, and it was our purpose to divert some 
 of the storage to these warehouses. At the present time our ware- 
 houses are comparatively empty, but we do not think that that is to 
 be a permanent condition. We would be willing, of course, to dicker 
 with the Government and try to come to some conclusion about it. 
 One suggestion that was made was to the effect that if the Govern- 
 ment took them over they could lease them to the Pennsylvania Rail- 
 road, and that they would operate them in competition with us in 
 the warehouse and storage business at Baltimore. In the first place, 
 they could not operate them in connection with their own line, be- 
 cause they are on our railroad. We do not believe that anybody 
 wants them. and. even assuming that they could lease them, we cer- 
 tainly do not believe that the Government should enter into competi- 
 tion with private enterprise if it can be avoided. 
 
REAL, ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 55 
 
 Mr. McKexzie. But it would be worth something to your company 
 to avoid that competition, and that would be an element in enhancing 
 the value of those buildings to the Government when it came to the 
 question of selling them to your company. 
 
 Mr. Baetjer. If they should undertake to do there what we under- 
 stand they are trying to do at Norfolk — that is, to enter the storage 
 business under an arrangement whereby all the overhead expense is 
 charged against the Government — it would not be fair or reasonable 
 competition. If we have to compete against the United States Gov- 
 ernment under those conditions, of course, they can break us. So 
 long as they can operate a storage business in these buildings, or as 
 long as these buildings last, they can certainly take storage away 
 from concrete storehouses. If it is a question of competing with the 
 Government on those terms, of course we could not do it: but that 
 is not a position in which we ought to be placed. We ought not 
 to be required to compete with the United States Government in the 
 storage business, with the overhead expenses of the Government's 
 storage business paid out of the Treasury. Now, in the first place, 
 we could have said to them, " You can not come in here." and we 
 could probably have made other terms with them, or they might have 
 come in like anybody else, but the Canton Co., of Baltimore, said. 
 " If this is a war need, you can have it." Of course, in that we did as 
 anybody else would have done at that time. 
 
 Mr. McKexzie. It is my understanding, and I think it is the 
 intention of this committee, that where the Government is renting 
 any property for storage purposes they tix their rental rates at 
 exactly what the civilian activities in that neighborhood charge for 
 the same character of service. 
 
 Mr. Baetjer. I am not familiar enough with storage rates to 
 answer that, but Mr. Brooks can give you the exact details of what 
 they propose to do at Norfolk in the use of those old storage ware- 
 houses. According to the statement that was made by one of our 
 employees, whom they took away from us, there is to be no overhead 
 charge to be paid by the business at Norfolk. There is to be no 
 overhead or interest on the investment, but they have simply the 
 operating expenses. 
 
 This arrangement which was made in Norfolk is the same kind of 
 an arrangement that they are going to make in Philadelphia if the 
 Government is not going to stop it. 
 
 Mr. Brooks, the president of the Canton Co.. would like to be heard 
 briefly. 
 
 Mr. McKenzie. We will be glad to hear Mr. Brooks. 
 
 Mr. Brooks. Mr. Chairman, I just brought this photograph along 
 to show you what our company has in Baltimore, and from it you can 
 see that we are really a live, going concern. During the war we 
 handled about 40 per cent of all the overseas shipments going out 
 of Baltimore. These warehouses you see here in the photograph are 
 our own warehouses. This pier you see here [indicating on photo- 
 graph] is 1,750 feet long and about 370 feet wide. It is built of con- 
 crete, and Ave think it is the best pier on the Atlantic coast. 
 
 My main object in coming before you this morning, Mr. Chair- 
 man, is this : This whole proposition is of value, of course, to the 
 company, because we have expended a good deal of money on it. but 
 it is also of great value to the port of Baltimore. 
 
56 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 Mr. Baetjer has just touched on the subject of the Government's 
 action in connection with warehouses. That is becoming a serious 
 thing and one which has given us and others who are in the same line 
 of business a great deal of concern. Mr. Baetjer spoke of the situa- 
 tion at Norfolk. The Government, through the War Department, 
 controls the Army base down there and they have actually entered 
 into an agreement with the city of Norfolk. 
 
 Gen. Carson. Have you seen that agreement? 
 
 Mr. Brooks. I have not seen it ; no. 
 
 Gen. Carson. Then why are you going into the details of it when 
 you have not seen it? 
 
 Mr. Brooks. Because I happen to be in close touch with the whole 
 situation. 
 
 Gen. Carson. You are not in touch with it, evidently, if you make a 
 statement such as you did just now, because you are all wrong in 
 that statement. 
 
 Mr. Brooks. I am not satisfied that I am wrong on that. 
 
 Gen. Carson. I am, because I drew up the lease. 
 
 Mr. Brooks. Then I will ask you if you will state the substance of 
 the terms of the lease. 
 
 Gen. Carson. I will do that later on. 
 
 Mr. Brooks. I will put it in this way, that my understanding is 
 that the city of Norfolk has entered into an arrangement with the 
 Government whereby they took the warehouses over. 
 
 The reason I said I was in close touch with that situation was 
 because they took one of my young men out of my office and put 
 him down there and he is now the port officer, and I thought I was 
 speaking with some knowledge on the subject. It Avas not just hear- 
 say testimony. 
 
 As I understand it, the lease is based on the collection of fees for 
 storage and the expenses are taken out of those fees, and if there is 
 anything left over, that is divided between the Government and the 
 city. You can readily understand that nobody who has a commer- 
 cial investment in this sort of plant could compete with the Govern- 
 ment under those conditions. 
 
 The other point that has come to my attention lately is this, that 
 the War Department has entered into an arrangement with the 
 Shipping Board whereby they have taken over another base in 
 Philadelphia. There are negotiations going on under which the 
 Shipping Board has practically laid out all the flour for export 
 passing through that port. You can readily see if the other ports 
 have to compete with the Government on that basis, what will hap- 
 pen to the business end of the proposition. That is a very serious 
 matter, Mr. Chairman and gentlemen, and I am trying to state the 
 matter to you as I see it. 
 
 Now, in regard to this special lease, when the Government took 
 over this property they entered into a contract with us, which Avas 
 agreed upon and signed, under the terms of which the price they 
 were willing to pay for the land per annum was fixed. 
 
 After the war was over, they took it up from the standpoint that 
 they would requisition this property, notwithstanding the fact that 
 they entered into a written agreement with us that they would take 
 the property under the terms of the lease, and when the lease ex- 
 pired they would turn the property back to us. 
 
REAL, ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 57 
 
 This property is directly in the path of our improvements. I 
 am satisfied that if I had had any fear before the lease was signed 
 that the Government would take such action as it has taken I would 
 have made an arrangement to locate the Government activities at 
 some other point where they would not have been directly in our 
 path. 
 
 This company which I represent — the Canton Co. — is a very old 
 concern. It was incorporated in 1828, and it has been rather suc- 
 cessful. That company has spent a good man}' millions of dollars 
 there. We own our own railroad, our own piers and wharves, and 
 we do not want the Government in there under those conditions. To 
 avoid that we have tried our best to come to an agreement to take 
 these buildings off of the Government's hands, with the idea that 
 we would control them and utilize them as far as they would go, and 
 when we were through with them destroy them, and we believed 
 that we would be better off in handling that situation from that 
 standpoint. 
 
 In appearing before you this morning it is with the full intention 
 of getting your favorable consideration to prevent the War Depart- 
 ment going through with this proposed undertaking — to take away 
 from us by requisition something we do not want to give them and 
 that they are not entitled to. 
 
 Of course, you have the fact before you that the Government has 
 spent nearly $2,000,000 on this property. But it was spent for 
 war purposes, and it has succeeded in carrying out what it was 
 intended for, and has put them in a position where they say, " We 
 will requisition this land and take it from you because the land has 
 increased in value." 
 
 The value they have arrived at, of $100,000, is a mere bagatelle, 
 and that is not a valuation that we would submit to, and we do not 
 intend to submit to it. They have just allowed us a valuation on a 
 basis of a little over $2,000 an acre on that land, while we have sold 
 land in that same vicinity, adjacent to it, to the Pennsylvania Rail- 
 road for $8,000 an acre. We do not want to sell that land. We want 
 to file with you gentlemen a protest against this action, because it 
 is not necessary for the Government to have this land while it is 
 necessary for the development of the port of Baltimore, and is 
 extremely necessary for the development of my company. 
 
 Mr. Greene. What other corporation or agency is there at that 
 port performing the same character of service that your company 
 performs ? 
 
 Mr. Brooks. I do not think anyone is in quite the same position as 
 we are. We own about 1,500 acres of land, and it was necessary for 
 us, with our water front, to build this terminal railroad all around 
 the city of Baltimore. It was objected to by the other railroads for 
 a long while, and we had a very strenuous fight to straighten that 
 matter out and to get that railroad built. It has now become an im- 
 portant factor to the port. It has the advantage of offering these ter- 
 minals to anyone who wants to occupy them or use them and having 
 the privilege of getting cars over the Baltimore & Ohio, the Pennsyl- 
 vania, or the Western Maryland Railroads on a flat rate. 
 
 Mr. Greene. You do a warehousing, a stevedoring, and a lighter- 
 age business? 
 
58 REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 
 
 Mr. Brooks. No ; we do not do a lighterage or a stevedoring busi- 
 ness. That is all done by other companies who have come in there. 
 
 Mr. Greene. You simply deliver at the pier head ? 
 
 Mr. Brooks. We deliver at the pier head and receive at the pier 
 head. We are handling to-day practically all of the ore business that 
 goes to Pittsburgh through the port of Baltimore. 
 
 Mr. Greene. You are a warehousing and a transfer company ? 
 
 Mr. Brooks. Yes, sir. 
 
 Mr. Greene. You have practically got a monopoly at the port of 
 Baltimore? 
 
 Mr. Brooks. A monopoly ? 
 
 Mr. Greene. On that end of the business. There is no other agency 
 performing the same sort of service, is there ? 
 
 Mr. Brooks. The Pennsylvania Railroad has its terminal, the 
 Baltimore & Ohio Railroad has its terminal, and the Western Mary- 
 land Railroad has its terminal. This is a terminal that was built and 
 used to develop this land, and it has been very successful, because we 
 have created quite a line of business there that was never there before. 
 We have built large bins for the receipt of sulphur, and Baltimore 
 has become the distributing point for the Middle West for sulphur. 
 
 Mr. Greene. Then, if the trunk-line railroads themselves do their 
 own warehousing and transfer work you must depend largely upon 
 strictly ocean business? 
 
 Mr. Brooks. No, sir ; we do a large ocean business, but we also do 
 more or less of a local business. Take the sulphur business, for ex- 
 ample. We have become a factor in this sense, that we have a posi- 
 tion there that no one else has, and we have one railroad that offers 
 the same facilities offered by all the other railroads without any 
 shifting of freight. 
 
 Mr. McKenzie. Is this a belt-line terminal? 
 
 Mr. Brooks. It is practically a belt-line terminal. We are quite a 
 factor in the business of the port of Baltimore in its pier develop- 
 ment, and we do not want those warehouses left there. 
 
 Mr. McKenzie. Have you any connection with any shipping line 
 or airy ocean liners? 
 
 Mr. Brooks. We have several of them. We have one concern that 
 has opened up there, which is doing a good business, I am very glad 
 to say. We had three of them, but all of them except this one are 
 broke, and this one concern is doing a good business, operating be- 
 tween California and our port. 
 
 Mr. McKenzie. Does your company own any stock in that line ? 
 
 Mr. Brooks. No, sir. 
 
 Mr. McKenzie. Do the owners of that line own any stock in your 
 company ? 
 
 Mr. Brooks. No, sir. 
 
 Mr. McKenzie. Do any of the shipping lines own stock in your 
 company ? 
 
 Mr. Brooks. No, sir ; we have always kept very free of that. We 
 do not own any stock in the railroads or the ship companies ; we own 
 our own property and operate on that basis. 
 
 Mr. McKenzie. Then you have to look for your business in com- 
 petition with the Pennsylvania Railroad, the Baltimore & Ohio Rail- 
 road, and the Western Maryland Railroad? 
 
 Mr. Brooks. Yes, sir. 
 
REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 59 
 
 Mr. Miller. Is there any combination of rates? 
 
 Mr. Brooks. No, sir. The way we get our recognition from them, 
 our receipts from them, is that they make us a very liberal allow- 
 ance, 28 cents a ton. for handling their cars and delivering to them 
 at our junction points. It has been a very successful pro position 
 because it has really produced something that very few ports have. 
 
 Mr. Miller. You get the overflow from those different lines in case 
 they have no storage facilities to take care of that stuff themselves? 
 
 Mi-. Brooks. At first, we were looked upon as suckers, but now we 
 are looked upon as producers. 
 
 Mr. Baet.ter. We have a lot of industries on our line that the Penn- 
 sylvania Railroad, the Baltimore & Ohio Railroad, and the Western 
 Maryland Railroad can not reach except over our line. For instance, 
 all the copper that comes in over the Pennsylvania, over the Balti- 
 more & Ohio, and the Western Maryland to Baltimore comes over 
 our line before it is delivered. Then, too, all of the Standard Oil 
 business goes over our line. So we also handle the switching of all 
 cars used by industries that are on what was formerly the Canton 
 Co.'s land. 
 
 Mr. McKexzie. Has there ever been an attempt to put a railroad 
 across your property \ 
 
 Mr. Brooks. The Pennsylvania Railroad has a terminal on our 
 property, and the Baltimore A Ohio and the Western Maryland 
 Railroads have connection with our line which is entirely by transfer. 
 Here is the Pennsylvania Railroad elevator | indicating on photo- 
 graph]. The Pennsylvania has another terminal. 
 
 Mr. Baetjer. The Pennsylvania Railroad, in order to get into its 
 warehouse, uses the space of eight city blocks for its storage yard, 
 and we say that we can not get in there with only 957 feet headroom. 
 This gives us 957 feet to the water front. We own on both sides of 
 the Government property. 
 
 Mr. Miller. Where are the Government warehouses now? 
 
 Mr. Baetjer. They are marked in green. 
 
 Mr. Miller. You can not get down to the other side of that 
 property now? 
 
 Mr. Baetjer. There are only 057 feet in between there, while the 
 Pennsylvania Railroad, in order to get to its dock, uses eight city 
 blocks. The only activities we have are port facilities; we do not 
 do any other business except with port facilities. 
 
 Mr. Miller. The streets in here run across this property, do they? 
 
 Mr. Brooks. They were allowed to build right straight across. 
 
 Mr. Greene. This, of course, goes back to the time when the old 
 port was the scene of the coming and going of brigs and sloops, 
 when the land values around the water fronts were what anybody 
 might make them rather than what any market might make them. 
 
 Mr. Brooks. Of course, the development of the port itself was 
 farther up the basin, and this section is practically a new section 
 that has been developed in the last 10 or 15 years. 
 
 Mr. Greene. It has grown up by reason of the extension of in- 
 dustrialism on the water front ? 
 
 Mr. Brooks. Yes, sir. The way this company derived the name of 
 the Canton Co. was by reason of the fact that the early owners of 
 the company were nearly all of them merchants who were trading 
 with China and the ships that used to come in there were ships 
 
60 REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 
 
 that came from China, and these men caJled that section of Balti- 
 more Canton because of that circumstance. It may be of interest 
 to know that old Peter Cooper was the first president of the Can- 
 ton Co. 
 
 Mr. Baetjer. Before we came to any conclusion on the matter of 
 price a committee from the War Department came to Baltimore and 
 went all over this project. They did that before we got together 
 on the proposition of a price. That was not done from here because 
 this committee, which was composed of representatives of the Army 
 and a civilian representative of the Quartermaster Department, went 
 to Baltimore and went over the whole proposition, and although Ave 
 did not actually close the matter up we were mighty close to it; we 
 were very close together on the matter of price. 
 
 Mr. Greene. Was any reason given afterwards for the failure to 
 agree upon a price? 
 
 Mr. Baetjer. Their last proposition was made in August, and we 
 were very close together. The proposition was that we would pay 
 them $300,000, $30,000 down and $30,000 in each of nine annual in- 
 stallments, with interest at 6 per cent on the deferred payments, 
 which were to begin on July 1, 1921. Subsequently they said they 
 would give it to us at an earlier date. That was the substance of 
 their letter. 
 
 Mr. Miller. Who signed that letter? 
 
 Mr. Baetjer. That was signed by Maj. Bussche. 
 
 Mr. McKenzie. Why did you not close with them on that propo- 
 sition ? 
 
 Mr. Baetjer. Because we thought when we said we would pay 
 $300,000 that then we would be paying all we could possibly pay, 
 and when they added interest at 6 per cent on the deferred pay- 
 ment, we felt we could not pay that, that we could not possibly get 
 out of it and that we would make a loss every year, paying $18,000 
 interest. We would have gotten together — as a matter of fact, my 
 recollection of it is that at the last interview we had with Maj. 
 Bussche we said we would pay 3 per cent interest, and the major 
 said, " We can not do that." 
 
 Maj. von dem Bussche. That is true. 
 
 Mr. Baetjer. Then we had gone too far. That was in August of 
 last year. 
 
 Mr. Brooks. We could not pay that price to-day, in view of the 
 present situation, but at that time theie was some hope that there 
 was new business in sight which would warrant us in paying that 
 amount. 
 
 Mr. Greene. You are a business man, and I am not. That remark 
 of yours made me think of this. You would not pay that price to-day 
 because your facilities are not in use. The business prospect is not 
 very comfortable now. Still, if you owned a wagon that would be 
 good to handle the business that came to you two weeks from now, 
 would you sell it at this week's price ? 
 
 Mr. Brooks. That is a matter of judgment entirely. My reason 
 for fearing that I would not have as good a margin would be largely 
 based on the very conditions that the Government is bringing about 
 in these commercial enterprises, and the sooner the Government gets 
 out of that business the better it will be. 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 61 
 
 Mr. Greene. Whatever may be thrown on the market, the people 
 who own and operate agencies like yours do it on a commercial 
 basis, so if there is not any business this week you would not prob- 
 ably base your charge on what this week's returns were, but you 
 would have a series of calendar years in mind. 
 
 Mr. Brooks. If I was going to extend my business I would prob- 
 ably base my judgment largely on the figures of the business of that 
 date. 
 
 Mr. Greene. You would not extend it at all if you thought that 
 was the end? 
 
 Mr. Brooks. That is not extending it. 
 
 Mr. Greene. One reason why you folks would operate this new 
 property at all is because the future holds out the promise of good 
 business, and you want the Government to sell to you at what the 
 market now is. 
 
 Mr. Brooks. The Government has not hestitated to hold the lease 
 that they have with us, which was made at their price, and then not 
 pay the rental, and then put themselves on record as making a requisi- 
 tion, which is one way of saying, " I am going to take this property ; 
 I do not care whether you want me to take it or not." But they will 
 hear from me before they do that. 
 
 Mr. Greene. Of course, you realize that the Government is an im- 
 personal thing? 
 
 Mr. Brooks. Yes; I know that. 
 
 Mr. McKenzie. Gen. Carson, we will be glad to hear you on this 
 proposition. 
 
 Gen. Carson. In the first place, Mr. Chairman, the proposition 
 upon which Mr. Brooks and his representatives dwelt so strongly 
 was made to them last August, in 1920. The situation has changed 
 since then, and the War Department now intends to utilize this 
 property indefinitely as a storage depot for the Third Corps Area. 
 
 The buildings are now, according to my latest information, prac- 
 tically filled, and they have no other place to which to send that 
 property, so that the pians of the department now contemplate a 
 retention of this property as a part of the permanent establishment. 
 
 The second point I wish to cover is the statement that the Govern- 
 ment is able to compete with similar warehousing industries because 
 it ignores certain charges, the situation at Norfolk being cited. 
 
 As a matter of fact, the rates which are now charged at Norfolk 
 for warehousing merchandise are fixed by the Interstate Commerce 
 Commission and the Government is charging the same rates that 
 other warehouse people conducting a commercial enterprise are 
 charging. The agreement with the city of Norfolk was based upon 
 that fact — that is, that the rates charged by the Government would 
 be the same rates as those charged by local commercial enterprises 
 for similar facilities — and that policy is being pursued at every base. 
 Whether or not the Government charges anything for overhead or 
 depreciation does not enter into the question at all. 
 
 Mr. Miller. What have you to say in reference to the statement 
 which has been made that this property was to be turned back to the 
 Canton Co. on July 1 of this year, and that the War Department now 
 wants to retain it? When was that brought about? 
 
 Gen. Carson. It was brought about during the past winter. 
 
 Mr. Miller. What condition brought it about? 
 
62 REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 
 
 Gen. Carson. I am not able to give the reasons exactly, as we got 
 our instructions from higher authority. It was a decision made by 
 higher authority. 
 
 At the time the proposition was made to dispose of these buildings 
 it was thought that they would not be required and that other ar- 
 rangements would be made. Since then the situation has changed, 
 and now the buildings have been, as I said before, filled with 
 material. 
 
 So far as we are advised by the War Department, it is the inten- 
 tion to retain that depot as an area storage depot of the Third Corps 
 Area. 
 
 Mr. Miller. Those buildings are not adapted for permanent stor- 
 age, are they? 
 
 Gen. Carson. The superstructures are not, but they are in fairly 
 good shape. The reason why they are in their present condition is 
 because of the uncertainty as to whether we would acquire them, so 
 we have not kept them up in the shape in which they would have been 
 kept otherwise. 
 
 Mr. Miller. Is the Government interested in any other property 
 in the city of Baltimore? 
 
 Gen. Carson. We have no other storage place there. 
 
 Mr. Baetjer. You have a tremendous area at Camp Holabird. 
 
 Gen. Carson. That is a motor transport camp and has nothing at 
 all to do with storage. 
 
 Mr. Greene. Baltimore is the second port on the Atlantic sea- 
 board, or the third port; is it not? 
 
 Mr. Baetjer. It is a third port. New York is the first port, and 
 I think Philadelphia is ahead of Baltimore. 
 
 Mr. Greene. The Army is likely to use it to a greater or less 
 extent in connection with supplies sent to Panama or the insular 
 possessions, is it not? 
 
 Gen. Carson. If it were used for any of them, I think it would 
 be. I can not say about that in detail. But. aside from that, it is 
 desired by the War Department for area storage. We have general, 
 intermediate, and area storage depots. The area storage depot is 
 under the control of the corps area commander, and his supplies 
 for his troops are supposed to be kept in there, and they can be or- 
 dered out by him without any further reference to the War De- 
 partment. Then we also have reserve depots, where, reserve sup- 
 Elies are kept, and which are subject only to orders from the War 
 •epartment. 
 
 Mr. Miller. What would be the reason why an area storage depot 
 should be on the water? 
 
 Gen. Carson. There is no particular reason why it should be on 
 the water, except that in this Third Corps Area a number of sta- 
 tions located on the coast can be reached by water. 
 
 Mr. Greene. Their supplies would not be of the volume or con- 
 stancy to make it an economic proposition? 
 
 Gen. Carson. I think not. 
 
 Mr. McKenzie. These warehouses are not located on the water 
 front, so you would have to transfer the stores to the water front 
 to get them on the ships? 
 
 Gen. Carson. We would. 
 
REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 63 
 
 Mr. Brooks. They stand right across our line. We could get 
 around them, but it would be very inconvenient and make an ex- 
 pensive operation. 
 
 Mr. Baetjeb. If it is only a temporary thing-, we can arrange to 
 lease it to them, if we have some understanding so that we can get 
 through to get to our line. 
 
 Mr. M< Kexzie. My question was prompted by the testimony 
 which was given yesterday in reference to the New Orleans ware- 
 house which. I assume, is on the dock, and it would be a matter of 
 economy for the Government in storing property to be able to ship 
 it direct to the storehouse, and then if they wanted to ship it by 
 water to Panama they could take it out of the warehouse and put 
 it right on the boat. 
 
 M. Brooks. May I explain this to the committee in regard to those 
 warehouses ( They are served by three railroads, or by a road work- 
 ing in the interest of all of those railroads, with the extremely low 
 local rate of about ii cents per ton: so that if they want to transfer 
 any of their supplies to the water for water shipment I do not believe 
 they could haul it there by truck and compete with that railroad. 
 The thing that I want to impress upon the committee is this, that 
 there is no desire on the part of the Canton Co. to incon °nience the 
 Government in any way, and we could readily supply the Govern- 
 ment with a good location at another point in that vicinity. We 
 would lose the value of the construction put on there, but when you 
 come to consider the business of the port, and I think it is well to con- 
 sider it, we ought not to try to do anything that would interfere with 
 its development. We are making great progress in port development 
 at Baltimore. 
 
 Mr. Miller. That is the point on which I wanted to question Gen. 
 Carson — that is, as to the necessity of using these buildings as a sup- 
 ply depot. Why could not these buildings be used temporarily, and 
 then locate permanent buildings there in the course of few years. 
 As I understand it, the superstructures are of frame, but the founda- 
 tions are of concrete. 
 
 (yen. Carson. The buildings are on concrete piers or concrete plat- 
 forms, and they are the most expensive and valuable parts of the 
 construction. 
 
 Mr. Miller. To complete them, or to make them of permanent con- 
 struction, you would, of course, make the superstructure there of 
 concrete, placing it upon the same platforms or piers? 
 
 Gen. Carson. Upon the same platforms ; yes, sir. At the time the 
 property was taken it Avas the only available site for this purpose. 
 
 Mr. Baetjer. Is it not a fact that those concrete pillars will not 
 carry anything more than a frame superstructure? Our information 
 is that they will not carry anything more than frame superstructures. 
 If you want to lease the property so as to get your utility out of it. 
 we are willing to lease them to the Government at almost a nominal 
 rental. 
 
 Gen. Carson. I think those platforms will carry something like 300 
 pounds to the square foot. 
 
 Mr. Brooks. I can probably tell you about the construction there, 
 
 because I constructed those buildings. The construction consists of 
 
 a brick wall that was built with round edges. That brick wall is 
 
 filled in up to the level of the floor. On top of that there is a con- 
 
 50916—21 5 
 
64 HEAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 
 
 crete floor — not a reinforced concrete floor, but a plain concrete floor. 
 That construction was made in 191S, and we had a great deal of 
 trouble from frost. Some of the floors were laid during a frosty 
 period and had to be relaid. They could not be relaid with con- 
 crete at all in some cases, because they were too soft, and plank 
 floors were put in there. The buildings were of frame construction, 
 but of very good material. There was no paint on them. The roofs 
 are practically temporary roofs, and the buildings to-day are not 
 in good condition. 
 
 Mr. Miller. You constructed the buildings? 
 
 Mr. Brooks. Yes, sir. 
 
 Mr. Miller. Did you have a cost-plus contract? 
 
 Mr. Brooks. Yes, sir. 
 
 Mr. Miller. You did not lose anything on the construction, did 
 you \ 
 
 Mr. Brooks. My net result on that was about $1,600,000 worth of 
 work with a net profit of $12,000. How I got through I do not 
 know. 
 
 Gen. Carson. We have no other similar buildings in that area 
 to be utilized, and one reason why we want to keep them is because 
 we are there. We spent originally nearly $2,000,000 in the way of 
 improvements. That represents not only money spent on buildings, 
 but, unless my recollection is wrong, also in filling in the land. The 
 land itself has been improved over what it was when we originally 
 took it over. It was unimproved marshy land, and it was filled in 
 in connection with this construction. If we do not use this we will 
 have to obtain storage space elsewhere within this Third Corps 
 Area, comprising the States of Maryland, Virginia, Pennsylvania, 
 and, I think. North Carolina. I know that there are a number of 
 States in that area. More money was spent than was necessary on 
 the improvements, but that is water over the dam. We do. how- 
 ever, want to get some use or return from the money expended 
 there. 
 
 Mr. McKenzie. What do you say about $100,000 being a fair 
 valuation ? 
 
 Gen. Carson. T think it is not only fair, but liberal. 
 
 Mr. Baetjer. If I may interrupt for a minute, let me say that 
 they have Aberdeen in the same area. The General Utilities Co. that 
 has been the lessee of the Aberdeen plant said to have cost $10,000,000, 
 including storage warehouses and a cold storage plant, is in bank- 
 ruptcy now. That is only 25 miles from Baltimore, on the Pennsyl- 
 vania Railroad, at Havre de Grace, and I know that the Government 
 is leasing it. They certainly have Camp Meade which is halfway to 
 Washington, where they have something over 100 acres. It is true 
 that they have no good storage buildings at Camp Meade nor at 
 Aberdeen, but the buildings that they have down here are such that 
 they certainly will have to rebuild them. If they only want to get 
 their utility out of them, for something like five years, we will lease 
 them what they want. They have changed on this. Last August 
 they did not want them, and if they did not want them last August, 
 is it not reasonable to suppose that it is simply a temporary thing and 
 that a year from now they will not want them? We are willing to 
 lease to them at a nominal rental until they get their utili.tr of 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 65 
 
 them. We do not want them to get in our way there so that we can 
 not develop the port, and that is really the serious situation for us. 
 While it is a serious thin" - to us. it is also a serious thing to the port. 
 
 (Jen. Carson. Aberdeen is an ordnance proving ground, and Edge- 
 wood belongs to the Chemical Warfare Service. Camp Meade is a 
 division camp, and. therefore, neither of those places is available 
 for storage purposes. The assumption as to what we should do is 
 entirely a matter of opinion on the part of the gentleman who has 
 been speaking. We know what we will do. and we know what we 
 will require. The question as to whether this interferes with the 
 development of the port at Baltimore is. of course, a matter of opin- 
 ion, and, necessarily, they are giving their own private opinions. No 
 one who has been over there could possibly believe that its develop- 
 ment would be affected by these buildings for '25 or 30 years. It 
 can not interfere with them now. considering the unused area that 
 they have. 
 
 Maj. vox DEM Bussche. I might relate the negotiations, if the 
 committee would care to hear about them. 
 
 Mr. McKenzie. We will be glad to have your statement in regard 
 to the negotiations. 
 
 Maj. von DEM Bussche. The property was taken on lease in the 
 beginning, and subsequently it was requisitioned. An award was 
 made by the War Department's Board of Appraisers, which investi- 
 gated the values, of $77,000 for the 35 acres involved. The total 
 cost of the construction which was placed on there, including these 
 buildings, ;i heating plant, concrete roads. filling the grounds, etc.. 
 wns $1,909,000. When the proposition of disposing of this site 
 came up, T was chairman of the board that went to Baltimore to 
 investigate the matter. Local real estate men and local warehouse 
 interests in Baltimore valued the plant as it stood at about $1,000,000. 
 That seemed to be excessive, and the board upon its determination 
 found that the good market value of the property was in the neigh- 
 borhood of $600,000. It has a distinct goin<2; concern value for the 
 Canton Co., because they could utilize the plant as it stands. 
 
 Mr. Miller. In connection with their other properties? 
 
 Maj. vox iu'.m Bussche. Yes. sir: and that, I think, is what they 
 intended to do. Eventually they made an offer to the War Depart- 
 ment to buy it for $300,000, to be paid in 10 annual installments of 
 $30,000 each. We had several meetings with them, and finally it was 
 decided that we could sell, or that we would sell it, but it was. I 
 believe, my own idea that interest at 6 per cent should be charged 
 on the deferred payments, because the Government was paying in- 
 terest on money itself, and there was no good reason that I could 
 see why we should not have the legal rate of interest in the State of 
 Maryland on the deferred payments. In considering this whole 
 thing, we figured that the 665,000 square feet of space which was 
 available, or would be available, for their use in time, could be stated 
 at 30 cents per square foot, which would mean an annual income of 
 about $200,000 a year. Fixing the life of the buildings at five years, 
 there was a value of nearly $1,000,000 that they would make out of 
 the property, because it had a going concern value for their use. 
 That was one of the reasons that prevented the board from giving 
 way on on their proposition for the payment of interest at the rate 
 
66 REAL ESTATE TO COMPLETE ACQUISITION IX CERTAIN CASES. 
 
 of 3 per cent, that being a counter offer that they made. They would 
 not pay 6 per cent, but finally they offered 3 per cent interest. 
 
 I believe all the negotiations ended at that time, because the ques- 
 tion of warehousing came up again, and it was decided to retain this 
 plant. The investigation of the real estate value at the time the War 
 Department took the property over, if I am correct about it, showed 
 that two-thirds, or perhaps not so much, of the area was largely 
 lowlands and swampy ground that had to be filled in. Of course, that 
 filling has greatly increased the value of the land, and the value was 
 fixed at that time by local interests or experts who gave testimony 
 before the War Department's board of appraisers. The board of ap- 
 praisers fixed the value at $77,000 and made an award of that amount. 
 The Canton Co. has never recognized the requisition and has never 
 accepted any part of the award, but has refused to do so. 
 
 Mr. Baetjer. You never offered it. 
 
 Maj. von dem Bussche. The leasing, of course, ceased legally when 
 the requisition was made. At that time, under the law. we could 
 not pay any rental on the property that was requisitioned, and there- 
 fore from the date of the requisition until now we have paid no 
 rental. Legally we can not do that. 
 
 Mr. Miller. That was an appraisal, and the value was fixed at 
 $77,000? 
 
 Maj. vox dem Bussche. Yes, sir; that was the award. 
 
 Mr. Miller. Was any offer made to the Canton Co. \ 
 
 Maj. vox dem Bussche. That was the award, and the award was 
 sent to them. 
 
 Mr. Baetjer. It was never sent to us. You stated it orally in our 
 presence, but we have never been notified nor have we been offered 
 the 90 per cent. We have not been notified of the award and there is 
 no record in the War Department showing that we have been notified. 
 except what you told us. That is the only information we have ever 
 had of the award that was made. We have never been offered the 
 90 per cent and we dispute the award. 
 
 Maj. vox dem Bussche. As to that, of course, I can not say. I was 
 never a member of the board of appraisers. They made their award. 
 and the records show that the award was made in writing and was 
 approved by the Secretary of War. Whether or not they sent it out I 
 do not know, but, so far as we know, the award stands as made. It 
 is reasonable to suppose that the company was notified. As I said. 
 that award amounts to $77,000. 
 
 Mr. Baetjer. As a matter of fact, you can take it from us that we 
 were not notified, and I think the records of the department will show 
 that no notice was sent out. The Canton Co. took no part in it and 
 has disputed it from the beginning. 
 
 Maj. vox dem Bussche. If the War Department should dispose of 
 this property to the Canton Co.. it has a right to expect a reasonable 
 return. It is not a question of salvaging it. because it has a going 
 concern value to this company, because they are in that same identical 
 storage business. That space is extremely valuable to them, and 
 anyone could practically control the market for storage by leasing 
 this out ft a very much less figure. I do not know what storage space 
 is worth to-day in Baltimore, but at the time of those negotiations 
 Ave were getting 30 cents per square foot, and that was well below the 
 
REAL ESTATE TO COMPLETE ACQUISITION IN CERTAIN CASES. 67 
 
 customary rate. The company could have taken this property at 
 $300,000 and leased it, or even a portion of it, at 30 cents per square 
 foot, and still have made a very handsome profit on an investment of 
 $300,000. That was the attitude that the board took in going over the 
 figures. 
 
 Mr. Miller. You are acquainted with the property? 
 
 Maj. vox dem Bussche. Yes, sir. 
 
 Mr. Miller. What do you say about the property being in a key 
 position whereby it could be used to prevent development on the 
 water front \ 
 
 Maj. von dem Bussche. I do not see it that way. There are many 
 routes that they could take without going through or over this prop- 
 erty. Of course, the development of the Canton Co. is right at this 
 property and could go directly through this property, but I can not 
 see any reason why it could not be diverted and go around it. This 
 property lies right in the center of their property. It consists of 35 
 acres in the center, and it is naturally very valuable to the Canton Co. 
 
 Mr. Brooks. Do you recall how much we offered to lease the prop- 
 erty to you for per square foot '. 
 
 Maj. vox dem Bussche. I do not know. 
 
 Mr. Baetjer. 15 cents per square foot, as per the letter of April 2, 
 
 Maj. vox dem Bussche. I do remember that question of leasing to 
 the Government at 15 cents per foot, but there was a question of why 
 the Government should pay 15 cents per foot for facilities that it had 
 constructed and owned. 
 
 Mr. Baetjer. We will give you a lease on it until you tear the 
 buildings down, to show you that we do not want them. If you will 
 not lease them, let us tear them down. 
 
 Gen. Carson. You do not need to tear them down. 
 
 Mr. Baetjer. It is very well to say that, but the best engineering 
 people advise us that with that 957 feet of headway we can not go in 
 there, and you can not say offhand that it is not so. 
 
 Gen. Carson. I do not say that offhand, and I suggest that you 
 have some other engineering talent to go over the figures. 
 
 (Thereupon the subcommittee went into executive session, after 
 •which it adjourned.) 
 
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