He doubts the propriety of of the Interior are confined to geological surveys. extending our report to activities which are not proposed by this legislation to be performed by this Department. I am submitting both proposed reports to you herewith. RUFUS G. POOLE, Assistant Solicitor. UNITED STATES DEPARTMENT OF THE INTERIOR, Memorandum for the Secretary. RUFUS G. POOLE, Assistant Solicitor. THE SECRETARY OF THE INTERIOR, Hon. RENE L. DEROUEN, Chairman, Committee on Public Lands, House of Representatives. MY DEAR MR. DEROUEN: I am in receipt of your letter of February 25 requesting a report on H. R. 6098, a bill to assist and promote the development of the mineral resources located within the national forests of the United States, authorizing the construction of roads by the Secretary of Agriculture for the use of the owners or operators of mining properties, and for other purposes. In the language of the bill, there is the plain implication that the proven presence of mineral or ore bodies in quantity and of commercial value is sufficient in itself to warrant the expenditure of public money to provide ways for their transportation, and upon the disclosure of such conditions alone, the applicant is entitled to the grant of his application. In a broad sense, if ores are of commercial value, they can be mined, transported, and marketed at a profit, and if they can be so mined, transported, and marketed, no reason is seen for the use of public funds to increase the profits of the owner of the mine. But assuming that what is meant is if minerals exist in quantity and commercial grade they can be produced at a profit, provided that the Government constructs and maintains roads and bridges to transport them within the forest, still I do not see the warrant for the expenditure of public money for such purpose unless a satisfactory showing is made that there is a public demand for the mineral from the mine to which the road is to be built, and like assurance that the road would be used for the transportation of minerals and supplies for a sufficient length of time to justify the cost of construction thereof. Many factors, beside mere mineralogical conditions, would have to be considered as a basis for intelligent decision. Among these may be mentioned an inquiry whether the operator of the mine has the capital, the capacity, the mining facilities, and the bona fide purpose to mine and market the deposit; whether the existing market conditions would probably justify the throwing on the market of the additional product, or, stated differently, whether it is in the interest of sound conservation of mineral resources and economic policy to promote the mining of the particular resource at public expense, for it is not believed that any good purpose would be subserved in dumping unneeded mineral on a glutted or depressed market. An inquiry would also be pertinent, whether the contemplated scale of operations at the mine instified the cost of the building of the roads and bridges, which would entail the formulation and comparison of estimates of cost of the road and probable production of the mine. It may be doubted whether the bill confers upon the Secretary the latitude of discretion above indicated and thought necessary for its proper administration. But unless such discretion can be exercised, there is a high probability in many instances that roads and bridges would be built for mines that would not be found economically practicable to work and the use for the purpose for which the roads were built would not be commenced or would be shortly abandoned, and that deposits that might be minable in a different situation or under different market conditions, would be used as a pretext for obtaining contracts to build roads. Even if the bill confers authority upon the Secretary to consider all the factors necessary to justify the expenditure of public funds, the bill, if it becomes a law, is difficult of administration, requiring the determination of facts not easy to ascertain certainly, that are subject to controversy and change, and requires the Secretary to speculate upon the success of a proposed mining venture, and may result in the expenditure of public funds in private interest, without any compensatory benefits to the public interest. The bill also further operates to give undue advantage to those having mineral deposits in the forests over others having like deposits similarly situated outside the forests. For the reason stated, I do not look with favor on the bill. HAROLD L. ICKES, Secretary of the Interior. HOUSE OF REPRESENTATIVES, Hon. HAROLD L. ICKES, COMMITTEE OF IRRIGATION AND RECLAMATION, Secretary of the Interior, Washington, D. C. MY DEAR MR. ICKES: Reference is made to your report on H. R. 6098, a bill introduced by myself "to assist and promote the development of the mineral resources located within the national forests of the United States, authorizing the construction of roads by the Secretary of Agriculture for the use of the owners or operators of mining properties, and for other purposes," which you disapproved. In considering this matter, let me bring to your attention the fact that vast undeveloped mineral deposits are located within the boundaries of the national forests in the Western States; that in these national forests many mining locations have been made and mining properties have been acquired by companies and individuals in good faith; that the owners of these mining properties are devoting their time and money to the development of these properties; that under the rules and regulations governing the administration of the national forests the owners and operators of these mining properties are entirely dependent upon the Federal Government for the construction of the necessary roads to afford transportation to the mining districts in which the properties are located, and that, pursuant to the policy that is being followed by the Forest Service in the construction of roads, the needs of the mining properties are met only so far as may be incidental to the program of road construction for forest administration and fire protection. As stated in a letter recently received from an executive of the Forest Service: "Under the policies heretofore governing the use of forest highway funds, money has not been available primarily for the purpose of constructing roads needed by miners to develop their properties or to open up areas of assumed mineral values. * * * There are relatively large demands being made by owners of mineral properties to have the Forest Service build roads into these properties or to have the Forest Service extend roads into particular sections of the national forests where minerals in paying quantities are alleged to exist. Obviously, all these demands can be met only to the extent that the program of forest roads needed for the protection and utilization of the Government resources of the national forests may incidentally serve the purposes which the miners have in mind." And, again at a later date: "The road fund, as now made available to the Forest Service for the construction of truck trails and roads, does not permit the allocation of such funds for roads required primarily for the development of mining properties. Prior consideration must be given the roads needed for the protection and administration of the national forests." From information that is available in the numerous geological reports on file in your Department, doubtless you are aware of the extent and value of some of the mineral deposits located in areas covered by the national forests. (See U. S. G. S. Circular No. 9, 1934-Mendenhall-Geology and Ore Deposits of Idaho County.) Many of these mineralized areas have not as yet been examined and and reported upon by the Geological Survey. While I am aware of the valuable and extensive mineral deposits of our Western States, located largely within the boundairies of the national forests, I am more particularly conversant with the mineral resources of our State of Idaho and its record of production of the precious metals-gold and silverproduced from a region which, according to a statement made by Dr. Finch, Director of the Bureau of Mines, is the "greatest undeveloped gold area in the United States." The importance of the gold deposits of this area (almost wholly within the national forests) has long been recognized by mining authorities. In the October 4, 1929, issue of the Engineering and Mining Journal there appears a treatise by Dr. Francis A. Thomson, now president of the Montana School of Mines, on the gold deposits of central Idaho. I quote from Dr. Thomson's article: "The Idaho batholith is probably one of the best-known geologic features of the Pacific Northwest. * * * "From gold veins in the batholith and in its roof were derived the placers of Boise Basin, in south-central Idaho, and of Elk City, Florence, Pierce City, and other camps of north-central Idaho, all of which were so abundantly productive in the sixties and seventies. * (Accredited by the United States Geologi cal Survey with a gold production of $250,000,000.) "The principal ore deposits of the country are steeply dipping fissure veins carrying principally gold and silver in a quartz gangue. * * "Such veins compare favorably, so far as size is concerned, with the gold veins of Australia, California, and Cripple Creek. The so-called dike deposits are purposely omitted from the tabulation given above. * * * "The lack of suitable highways is such that, under existing transportation conditions, only placer mining and the working of bonanza gold veins could be expected to show a profit." The bill H. R. 6098, under consideration, is designed and has been introduced to construct mining roads in the national forests, to facilitate the development of the mines and the utilization of the forest resources, not otherwise obtainable, similar to a plan that has been followed by the Canadian Government, which is a large factor in the success of the Dominion in increasing its gold production, which has expanded from 1,928,308 ounces in 1929, valued at $39,858,026, to 2,972,000 ounces, valued at $104,020,000 in 1934, and placed Canada for the first time ahead of the United States in gold production. The Canadian Government has a very liberal policy in assisting miners to develop their properties. I quote from the Mines Development Act of British Columbia, chapter 164: "2. Where it is shown to the satisfaction of the Minister of Mines that development-work on a mineral or placer claim or group of mineral claims in any mining district has proved the existence of minerals or ore-bodies in quantity and of commercial value sufficient to warrant an expenditure of public moneys for the construction of trails, roads and bridges to facilitate the operation and development of such mineral or placer claims, the Minister of Mines may authorize the expenditure of so much of the public moneys as may be required by the Minister of Public Works for the construction of such trails, roads and bridges." The importance of the development of our gold resources has been emphasized by recent legislation which increased the value of gold $14.33 per ounce. One of the effects of this legislation has been to increase the value of gold mined annually in the British possessions, $225,000,000. It would be difficult to overestimate the importance of developing the gold deposits in this country. When we consider the benefits to be derived by the increase in gold reserves, permanent employment in the mining industry, the stimulation to general business, by the development of these mining areas, and, of particular interest to the Government, additional sources of taxation revenue, by the payment of county, State, and Federal taxes, including capital stock taxes, corporation taxes, and income taxes, the Government, as has been stated by successful mine operators in California, takes about 50 percent of their revenue in the form of taxes. In view of these facts, it is apparent that the development of our mining resources, now isolated within the national forests, is of paramount importance to the whole Nation. Turning to the statement made in your report, disapproving the bill: "If ores are of commercial value, they can be mined, transported, and marketed at a profit, and, if they can be so mined, transported and marketed, no reason is seen for the use of public funds to increase the profits of the owner of the mine," it is difficult to reconcile the position taken by your Department in this case with liberal policy that has been followed by our Government in the past, in providing means of transportation by the construction of roads, digging canals and harbors, improving waterways, subsidizing the construction of railways, and the operation of steamships and airways, which has contributed so largely to the development of our national resources and our national prosperity. It is a fact that many mining properties located within the national forests contain ore deposits of commercial value "that can be mined, transported, and marketed at a profit," if the Government will do for these miners what it does for industry everywhere outside of the national forests-provide the necessary roads for transportation. Surely, the Federal Government will not evade the responsibility to provide the necessary roads for mining development, assumed when these areas, containing vast mineral resources and embracing many mining properties privately owned and acquired in good faith, were withdrawn from public domain and placed in the national forests where they are barred from receiving the assistance of the local government of the counties and States by the construction of the necessary roads. Referring to the contention raised as to the conditions to be considered in approving an application for the construction of mining roads, it is assumed that you have in the personnel of the United States Geological Survey, or will employ, qualified representatives to examine and report on the merits of the property covered by these applications, similar to the plan followed in Canada, and that discretion will be exercised in approving these applications, which is provided for in the bill. Instead of the bill giving “undue advantage to those having mineral deposits in the forests over others having like deposits similarly situated outside the forests," experience and comparisons will demonstrate that the opposite is the case, and thousands of valuable mining properties-in some cases entire mining districts are lying idle and inaccessible due to the indifference and neglect of the Government to construct the necessary roads to open up the districts. In view of the conditions affecting the development of mining properties located within the national forests, and the importance of the development of these mining resources to the prosperity and welfare of the country as a whole, I urge that your report on this bill be reconsidered and that your Department report the bill favorably. Sincerely yours, COMPTON I. WHITE. Hon. COMPTON I. WHITE, House of Representatives. THE SECRETARY OF THE INTERIOR, MY DEAR MR. WHITE: I have had under consideration your letter of July 27, 1935, urging reconsideration of my unfavorable report of April 24, 1935, on H. R. 6098, introduced by you, entitled "A bill to assist and promote the development of mineral resources located within the national forests of the United States, authorizing the construction of roads by the Secretary of Agriculture for the use of the owners or operators of mining properties, and for other purposes." As your letter came just before the adjournment of the first session of the Seventy-fourth Congress and laid considerable stress on certain publications relating to the mineral resources in Idaho, considerable areas of such resources being in national forests, early reply was deferred pending a study of these publications. The issue of October 4, 1929, of the Engineering and Mining Journal, as well as issues preceding and following that date, were searched for the treatise referred to by you, written by Dr. Francis A. Thomson, but without success. A treatise on the geology and gold resources of north and central Idaho by Dr. Thomson and Samuel A. Ballard was published as Bulletin No. 7 of the Idaho Bureau of Mines in 1924, and has been examined as well as the publication of the Geological Survey of 1934, relating to ore deposits and geology in certain parts of Idaho, to which apparently you referred. Conceding, as these publications disclose, the existence of great potential wealth of the lands in Idaho, and in the national forests in that State, for gold, and that development thereof may be to some extent impeded by lack of suitable roads, I am unable to see that these facts present a persuasive argument for the bill presented. The owners and operators of mining properties in the national forests are not absolutely dependent upon the Federal Government for the construction of roads to afford transportation to the mining districts in which the properties are located, if what is meant is that they are dependent on national forest |