Mr. WILLIAMS. By an act passed in 1866 Congress made a grant of every other section of land within certain sections to aid in the construction of a railroad there from Portland, Oreg., to run south and connect with the California & Oregon Railroad in California, and from Portland to Astoria by way of McMinnville. A limited time was given the railroad company to be recognized by the State of Oregon, in which to accept the terms of this grant. It is sufficient to say here that no railroad accepted the terms of the grant within the time mentioned. By the act of 1869 Congress renewed the grant, so to speak, and in so doing it provided that the lands granted should be sold in quantities not exceeding 160 acres to any one person, at a price not to exceed $2.50 per acre, and that such sales should be made to actual settlers. Mr. SINNOTT. Was that in the original act? Mr. WILLIAMS. And not in the act of 1866. By an act passed in 1870 Congress made a similar grant to the railroad that was to run from Portland to Astoria. A railroad from Portland south to the north boundary of California was constructed, known as the East Side Road. The road from Portland to Astoria was constructed for 47 miles. Both grants subsequently became the property of the Oregon & California Railroad Co. Speaking generally, the quantity of land earned by the construction of the road was 3,200,000 acres. My figures are only approximately correct, but they will serve the purpose. For a time there was little or no demand for the lands except by persons who desired them for agricultural purposes in limited quantities, and probably for a number of years the lands were sold in small quantities and to actual settlers; but when the value of the timber became known, and these lands are chiefly valuable for timber, the company sold the lands to anybody who had the money to pay for them, in such quantities as it could and at such prices as it could obtain, selling in some cases from 1,000 to 20,000 acres to a single purchaser, and in one instance they sold 40,000 acres as high as $40 an acre. It continued this practice up until 1903, I think when the company refused to make any further sales to anybody at any price. The matter was called to the attention of the people of Oregon, or the officials of the State of Oregon, and the legislature memorialized Congress in 1907, I think, asking that the matter be looked into. Thereafter Congress enacted the joint resolution in April, 1908, authorizing the Attorney General of the United States to institute necessary legal proceedings in law or equity, as the case may be, to determine the rights of the Government in the matter, and to enforce all of its rights under this grant. As a result of that action, the Attorney General filed a suit against the Oregon & California Railroad Co. involving the lands that the company had not sold, aggregating something like 2,300,000 acres. He also brought 46 suits against the railroad company and the purchasers who had bought the lands in violation of the terms of the granting act of 1869. I might say here that the Attorney General did not bring any suit where the party purchasing had purchased not exceeding 1,000 acres, for the reason that that would have brought on almost interminable litigation. Mr. MCCLINTIc. What was the basis of the suit against the purchasers? Mr. WILLIAMS. That they had bought the lands in violation of the character of the grant. Mr. TAYLOR. Did you bring suit to cancel or forfeit the grant? Mr. WILLIAMS. To forfeit the grant in the main suit and to set aside the purchaser's title in the 46 cases against the purchasers. A demurrer was filed in the main suit and the case was exhaustively argued. In 1911, I believe, the district court of Oregon rendered a decision upholding the bill and overruling the demurrer. Thereafter Congress, by an act passed on August 20, 1912, authorized the settlement of the purchaser suits. This was after the district court had decided the demurrer in favor of the Government, but before it had entered any decree declaring the lands forfeited. Under this act of 1912 all of the purchaser suits except five were settled. The railroad company was eliminated from those suits. The purchaser defendants confessed judgment, or allowed decrees pro confesso to be taken against them, and in accordance with the terms of the act of 1912 they applied to the Secretary of the Interior and were allowed to purchase the lands from the Government by paying $2.50 per acre therefor. Some 370,000 acres of land were disposed of in that way, for which the Government recovered something like $925,000, nearly $1,000,000. As I say, all the purchaser suits have been settled excepting a few-five, I think-involving only a comparatively small quantity of land. Following this decision on the demurrer the district court, in the main suit involving the 2,300,000 acres of unsold lands, entered a decree of forfeiture on July 1, 1913. The railroad company appealed the case to the circuit court of appeals for the ninth circuit, where it was argued. That court refused to decide the case and certified certain questions to the Supreme Court of the United States. By agreement of the parties the entire record was ordered up, and the Supreme Court decided the case on the 21st of June last, reversing the decision of the district court, which declared that the grant was forfeited by failure to observe the terms of the granting act, and ordering an injunction against the railroad company forbidding it to make any further sales of land contrary to the terms of the granting act. In view of the showing that had been made as to the value of the lands for timber, the Supreme Court further ordered an injunction against the railroad company forbidding it to make any sales whatever of the lands or the timber, in order that Congress might have an opportunity to order some disposition of the lands in such manner as it might see fit. Mr. SINNOTT. I have the exact language here if you wish it. Mr. TAYLOR. Is that decision of the Supreme Court printed in pamphlet form? Mr. WILLIAMS. Yes; it is in 238 U. S. Mr. MCCLINTIC. Why not put that decision in the record? Mr. WILLIAMS. The Supreme Court reversed the decision of the district court and remanded the case with directions that the district court should enter a decree previding that the railroad company be enjoined from making further sales in violation of the granting acts. The court further decided that in view of the value of the lands for timber, any attempt to sell them now in accordance with the terms of the granting act would invite more to speculation than to settlement, and for that reason the court ordered a further injunction against any sale or disposition of the land or timber for a period of not less than six months from the entry of the decree-and I quote from the language of the court: Until Congress shall have a reasonable opportunity to provide by legislation for their disposition in accordance with such policy as it may deem fitting under the circumstances, and at the same time secure to the defendants all the value the granting acts conferred upon the railroad. Now, it must be remembered that from the time the railroad company first got possession of these lands it paid taxes, at first on a very small valuation, which gradually increased until, when the lands were known to be so very valuable for timber, it was paying on a high rate of valuation. It continued to pay taxes until the entry of the decree of forfeiture on July 1, 1913. From that time the railroad company has paid no further taxes on its unsold lands. The accumulated taxes now amount to $1,300,000, I think, without penalties. Mr. MCCLINTIC. Unpaid taxes? Mr. WILLIAMS. Yes; unpaid. The railroad company claimed in its answer that it had paid taxes aggregating nearly $2,000,000. Mr. FREEMAN. $1,820,000. Mr. TAYLOR. How did the taxes stack up so fast in the last two years? Mr. WILLIAMS. Three years. They amounted to about $400,000 a year. Mr. TAYLOR. How many years have they been paying taxes? Mr. WILLIAMS. From the time they first got a patent. Mr. TAYLOR. When was that? Mr. WILLIAMS. Well, they patented some lands one year and some the next year. The taxes at first were very small. Mr. TAYLOR. Generally speaking, how long have they had a title to this land? Mr. WILLIAMS. Well, they have not had all of them patented yet. They have had the lands for 20 or 30 years. They had paid nearly $2,000,000 in taxes when the answer was filed. The CHAIRMAN. The thing that Mr. Taylor seems to be after, and it strikes me in the same way, is that it is so remarkable that the railroad company had paid from 1866 until 1913 only $1,800,000 all told, and that the taxes have climbed so high in the last three years. Mr. WILLIAMS. Well, that is because of the higher value of the lands. I know that in one case they paid 10 times as much as they did before. The taxes have increased almost 10 times over what they were 10 years ago. The CHAIRMAN. Was that due to erroneous valuations? Mr. WILLIAMS. Yes. In some instances the county officers went on the lands and had an actual scale made of the timber and based the valuation on that. That is the situation. The company had paid about $2,000,000 in taxes and now owes about $1,300,000. When the counties failed to receive this revenue, they became disturbed. The situation was acute, and in 1915, last year, the governor of Oregon called a conference to be held at Salem for the purpose of considering the entire matter. Many people did not understand the Supreme Court's decision; they did not know what it meant. Mr. TAYLOR. A good many do not understand it yet. Mr. WILLIAMS. I do not know, sir. This conference was held in September, and after a session of three days the conference adopted a resolution asking Congress to act in the matter. Perhaps I had better read just what the resolution was, as it is short. After a number of recitals it resolves: That the sense of this conference is that the Congress of the United States thould enact laws defining and settling who shall be considered actual settlers under the terms of said acts, and what shall be considered an actual settlement, and requiring the grantees under the said acts to perform the terms and conditions of said acts and to sell and dispose of said lands according to the true intent and purpose of said acts, and to such actual settlers. That we are unalterably opposed to any further increase of forest reserves in the State of Oregon. That we urge upon Congress the enactment of legislation which shall provide for the immediate sale of said grant lands in quantities not greater than 160 acres to any one person, and to actual settlers, at a price not in excess of $2.50 per acre, and to provide against any fraud in the settlement and disposition of said lands. That was a conference the membership of which was composed of delegates appointed, I think, by the county courts of the 18 counties in which this land grant is situated, and other representatives. The commissioner of the General Land Office, Mr. Tallman, was there, not officially but as a spectator; the forester, Mr. Graves, was therehe was invited to be there-together with other prominent men appointed by officials in Oregon, and they adopted this resolution. About that time, the attorney general's office, feeling that it should have some direct information regarding the matter, sent me to Oregon to ascertain the views of the people and see what should be done with the land grant. I made an investigation, and, of course, could not see very much of the land in a very few weeks, although I went entirely through it from one end to the other, and across it in places; interviewed everybody I saw that wanted to talk about it. They had various public meetings and dicussed the matter generally. Mr. CRAMTON. Did this case in the Supreme Court involve the lands that had not been patented as well as those which had been patented? Mr. WILLIAMS. Yes. It involved the entire grant, and the decree of forfeiture was ordered by the district court and worded in such a way as to cover, by general description, everything that could possibly be omitted from the special description. Of course, as to the unpatented lands, if the court had held that they were forfeited, the Land Department would have refused to issue any further patents. Mr. LENROOT. This was a grant in presenti? Mr. WILLIAMS. Yes. Now, I have given you facts. Anything that I might give you about my trip would be only my opinion. The CHAIRMAN. I think you had better continue and give us your opinion. A great many members would like to have your opinion. Mr. TAYLOR. I wish you would start out and assume that we do not know a blooming thing about this matter, and then go ahead and lay the foundations all the way along. Mr. WILLIAMS. I will. The CHAIRMAN. Mr. Williams has given us a very clear start on this matter, and I think he should go ahead and tell us about his trip. We would be glad to hear you, Mr. Williams. Tell us what you found there, what the conditions were, and what you think ought to be done there. Mr. WILLIAMS. Well, first I went to Portland and interviewed a number of public men, including former Gov. West, the two Senators, Mr. McArthur-and I was not so fortunate as to see Mr. Hawley, because I missed him down at Albany. Then I went down to Oregon City, and from there I drove out into the land grant in two places. I talked with men who said they would be glad to pay $40 or $50 an acre for the land adjoining their places. I went over to Willamina, on the west side, and drove north into the land grant and found the lands worth nothing for timber, because they had been burned off, and no timber was left except a few scattered old trees. I went out to Salem and to the foot of the Cascade Mountains and saw heavily. timbered land, some of it worth $70 or more an acre. I went to Albany, but I did not go to the land grant there; I talked with the county officials in every town I visited. I went out to Eugene, and from there, into the land grant, on both sides, east and west. I went down to Marshfield and drove back through the grant by the old Coos Bay wagon road. I went to Roseburg, the county seat of Douglas County, where the greatest amount of taxes is due. Then I went down to Grant Pass, where I found the people in a peculiarly hard situation. The grant lands constitute more than 121 per cent of their taxable property, and for three years they have failed to receive taxes for that land. Then I went to Medford and Jacksonville, in Jackson County, and found the situation somewhat the same. I found that there were a few actual settlers on the land, but I found very few actual settlers. I went up near Scappoose, on the Columbia River, where a number of settlers represented by former Representative Lafferty were said to be located. I found some houses, habitable houses, but no one living in them, and only one place showing any evidence of cultivation, and that was about an acre. The other houses had no clearings at all. I found actual settlers west of Eugene, some 10 or 12 in number, and I went into their houses. The men are living on the land with their families, and some of them have been there four or five years-some of them only a few months. All of them have gone there since this question was agitated. Mr. SINNOTT. What date do you fix for the agitation of this question? Mr. WILLIAMS. Well, I will say five years. That would only put it back to 1909, and this question was certainly agitated when Congress authorized the filing of the suits. None of them have been there more than five years. Most of the people that I saw thought that it would be a shame to sell these valuable timber lands at $2.50 an acre. I went through lands that are worth from $50 to $75 an acre, and I was told of townships where it was said that every quarter section would run practically 20,000,000 feet of timber, which, at $1 a thousand, would be $20,000 for the quarter section, or $80,000 a section. The actual settlers that I saw, of course, wanted to retain their holdings, but the more intelligent ones seemed to think that it would be enough if they were allowed to keep a reasonable amount of timber. Mr. LENROOT. Did you find these settlers upon the heaviest timber lands west of Scappoose? |