Congressman MOTT. Do you think that it has been possible for them to operate at a profit? Mr. ROGERS. To consider the growth that has been put on the timber, the capital gain that has been built up on it, that must be taken into account. Congressman MOTT. But the fact is that the Forest Service spends more money each year than it takes in from its revenue. Mr. ROGERS. Oh, yes. Of course, that's a matter of record; but there has been no estimate made as I know of that shows the capital gain, growth on the land, and that would have to be taken into account. Congressman MOTT. Do you attribute that to bad management or to overstaffing of the agency or general expense of bureaucracy? Mr. ROGERS. No. I wouldn't say that the management-that is, the local management-had anything to do with that, but the general policies are to withhold the timber. I would say the general over-all policy has had something to do with it. Congressman MOTT. You don't think the Forest Service has managed it as effectively as the O. & C. management? Mr. ROGERS. I wouldn't want to make a statement on that. Their conditions are entirely different. O. & C. lands are within 25 miles of the railroad and generally better timber. I wouldn't want to make a statement on that. Congressman McTT. Your proposal now that the Forest Service should operate on 25 percent of its revenue-would it have been a sound proposal 10 years ago? Mr. ROGERS. No; it wouldn't it. Congressman MOTT. But it is now? Congressman PETERSON of Georgia. I was interested in your statement that this land had been acquired through forfeiture of taxes. Did you have much that year? Mr. ROGERS. We did during the depression. Twenty-five years ago there was a pretty general theory in the United States that timber would be much higher. Consequently people purchased homesteads here and there and they were never able to recover it. In Douglas County alone when the depression hit, more than a quarter million acres reverted for taxes for several reasons. Those lands were pretty well intermingled with railroad lands or O. & C. lands, so that they were inoperative and the class was not as good as it was on the Columbia River. Consequently they lost those lands. Under our State acquisition act of 1941, we are taking over a great many of those lands and managing them on a sustained yield basis for the State, and 75 percent of the gross goes to the county and local government rather than' sell it back into private ownership. Congressman PETERSON of Georgia. How much is the assessment on forest lands? Mr. ROGERS. It is about $135,000,000. Congressman PETERSON of Georgia. I mean how much an acre? Mr. ROGERS. Usually on a stumpage basis. It varies from 50 cents a thousand board feet to as much as two and a half or three dollars a thousand board feet in some counties. Congressman PETERSON of Georgia. Can you estimate the number of board feet to the acre? Mr. ROGERS. Well, no. Congressman PETERSON of Georgia. What is the average board feet to an acre of timberland? Mr. ROGERS. Over in the pine area it runs about nine or ten thousand and in the Douglas fir area I judge thirty to thirty-five thousand. However, in some places they cut as much as a hundred thousand Douglass fir. Congressman PETERSON of Georgia. Is that part of the same land that would be on the 50 cents a thousand? Mr. ROGERS. No, that probably would be a dollar or a dollar and a half. Under the Oregon Conservation Act they must leave 5 percent of the bearing trees on each 160. Chairman PETERSON of Florida. Do you have a severance tax in this State? Mr. ROGERS. We have a forest seed and yield tax law where lands. have been cut over. Enacted in 1929. In western Oregon we classify them and take them off the ad valorem property tax roll entirely, pay 5 cents an acre for per year which goes into the local county. In eastern Oregon it is 212 cents a year, then, when it grows, is harvested, anything that is sold off, 1212 percent yield tax, which amounts to the same thing as a severance tax. Congressman MOTT. An effort was made to repeal that bill a few years ago. Mr. ROGERS. There was, and we amended it recently. We reduced the fee in eastern Oregon which was higher than ad valorem tax on newly logged land. Congressman MOTT. I introduced that bill in 1929, and I got busy with some of my friends in the legislature and the argument as I got second-hand didn't seem very essential to repeal it. Now, one more question: If the formula for distribution of revenues of the forest land were changed so as to give the State 75 percent instead of 25 percent, would that be about equivalent to the amount of taxes that that national-forest land would pay if it were now in private ownership? Mr. ROGERS. Yes. We determined from studies that over a long period of years that that would be about equivalent to what they are now getting. Congressman MOTT. This committee may get jurisdiction on a question of that kind by including the tax law, simply to make it apply to all Federal land, otherwise a bill of that kind would come within the Agricultural Committee of the House and probably wouldn't get very far because they are not as interested in these problems as the Public Lands Committee. Mr. ROGERS. I would like to say to stabilize the forest industry they should have adequate fire protection, sound cutting practice, and sound tax laws to privately owned land and a distribution of returns from publicly owned land in lieu of taxes that will be comparable. Congressman MOTT. That sounds sensible to me. Chairman PETERSON of Florida. Now, anything you wish to suggest later on we would appreciate your sending that to us because, frankly, we have been very much impressed with your statement. Mr. ROGERS. Thank you. Congressman ELLSWORTH. About a year ago, or a little less than a year ago, Lyle Watts, then regional forester for this region, was made chief forester of the United States, and his successor, Mr. Andrews, is here today. I wonder if you, Mr. Andrews, would like to make any statement at this time. Mr. H. J. ANDREWS. I would like to make a statement, but I wouldn't like to infringe on the time of any other person. Congressman ELLSWORTH. I am sure you wouldn't infringe on anyone's time. We would be glad to hear from you. STATEMENT OF H. J. ANDREWS, REGIONAL FORESTER AT PORTLAND Mr. ANDREWS. Members of the committee, my name is H. J. Andrews, regional forester at Portland. As to the territory covered, all of Washington and Oregon in the national forest, and I would like to bring up a few suggestions, which will not at least confuse the situation and might even clarify it. I would like to state that in the general development as might be expected the timber resources in the most accessible places are cut first. Puget Sound was the first operation, the Columbia River, Grays Harbor, they were also the scene of first operations. Lands tributary to the large water bodies where they could have timber exported by boat, and that was developed in the early days. Later, when the transcontinental raliways came, we had developed that way. In the early days private interests naturally picked up the timberlands. Logically those were the most accessible timberlands, leaving a vast reserve of public lands which was a—you know—well, by and large those were the more remote and inaccessible areas, farther back from water and rail and the centers of civilization. As the Forest Service took these large properties and administered them, they practically took over a wilderness, and for years their activities consisted of development work, reads where there were not any roa is. trails for protection. look-out houses, telephone lines. And all of those were for forest protection. For many years a considerable portion of the moneys spent by the Forest Service, not only here but in all the western regions and in the East, has been in the nature of an investment. A good bit of the money from this investment will be recaptured at an early date. The Forest Service could have put more timber on the market in the past than it has now. To have done so, I am size, would have more or less injured the existing timber industry. To have done so in the depression would have freed timber on the market when more timber was going on the market than was needed. Many, many kamer compantes requested the Forest Service 106 to follow that polley. On the other hand, at the moment ve te not terrain of our working cimie, particularly in the Pager Sond are creating our capacity because of the var, because, if we don't, there will not be any material for certain needs in that area. So if there has been any lack of timber put in the market, it has been with the idea of maintaining a table nonst27. Now, beginning way back in the drst decade of the entry, the Forest Service didn't even knew what maker ve had. It was only in the period 1980 to 1985 or 1986 that we had a rugging mentory of all forest lands in the eastern part; that is, both States. That was the so-called forest survey made at that date. Even prior to that we had worked out with the best data we had at hand sustained-yield units. Now, sustained yield units in both the case of the Department of Agriculture and the Department of the Interior are areas of land on which you take the volume of timber and the volume of second growth and other pertinent data and by a series of computations you figure what can be cut per year on those units so as to come along and keep growth in balance with depreciation. They have been doing that for a long time at the beginning of the century. And then in those units we have a certain amount of private land. In our units in central and southern Oregon we have O. & C. land grant properties. In all instances we at least calculate the allowable cut on the part of the other owners. We have no control of the other owners but we do try, in all instances except recently in two cases in Puget Sound, to keep our cut within the allowable annual cut as per our computations. And every so often, about 10 years, we try to reinventory our property in the light of changing economic practices and recalculate our sustained yield, because it is not a thing that is perfectly fixed. Timber on the national forest land which was not considered operable under any circumstances 20 years ago is decided operable today, and timber which is not considered operable today will be operable in 10 or 15 years as methods change. The increasing importance of hemlock makes a difference. Chairman PETERSON of Florida. Other than fir and pine, what have you in Oregon in other species? Mr. ANDREWS. Probably the next pieces in volume-I am talking first about western Oregon-or rather west of the Cascade Range in both States, hemlock is next. East of the summit of the Cascade Range ponderosa pine is the predominant species, and I think you can't make the picture clear if you don't talk about these geographical conditions in the State. Both in Washington and Oregon we have the Cascade Range run down the two States. West of the summit we have one set of climate, a totally different situation from the eastern side, just as different as Connecticut and Alabama. On the east side we have a drier climate and a different forest situation. On the west side hemlock is next in importance on the volume basis to Douglass fir. Then we have other species, western grain cedar, and some minor cedars, and then we have a group, including Noble fir, which is valuable for aircraft construction, and we have mountain hemlock and we have Sitka spruce, Port Orford cedar, and a large number of other minor cedars, and hardwood in the form of alder. On the east side we have some Douglas fir mixed in with the pine and range and white fir. So these forest properties in the hands of the Forest Service have been remote. Up until 5 or 6 years ago the national forest timber in Douglas County, Oreg., for example, was not operated. In fact, most of the private and most of the O. & C. timber in that territory was not operated. You can't say it was withheld from the market because the market was north of that county. Competitive conditions limited development to the Columbia River, Puget Sound, and Grays Harbor. We couldn't afford to open up certain timbers in southern and central |