OREGON & CALIFORNIA RAILROAD GRANT LANDS

THURSDAY, MAY 6, 1943

UNITED STATES SENATE,

COMMITTEE ON PUBLIC LANDS AND SURVEYS,

Washington, D. C.

The committee met, pursuant to call, at 10:35 a. m., in the committee room of the Committee on Public Lands and Surveys, 224 Senate Office Building, Senator Murdock (acting chairman), presiding. Present: Senators Murdock (acting chairman), Gurney, Holman, and Robertson.

Also present: Senator McNary, and Congressman Ellsworth, of Oregon.

Senator MURDOCK. The committee will kindly come to order. Senator HOLMAN. May I, Mr. Chairman, invite the three county judges and their representatives to sit at the table?

Senator MURDOCK. The committee will be happy to have the gentlemen take seats as indicated by Senator Holman.

The purpose of our meeting this morning is to consider S. 275, introduced by Senator McNary, of Oregon. This bill, as I understand it, Senator McNary, is an exact duplicate of S. 1985, introduced by you in 1941.

Senator McNARY. That is correct.

Senator MURDOCK. We will ask, if there is no objection, that S. 275 be made a part of the record at this point.

(S. 275 is as follows:)

[S. 275, 78th Cong., 1st sess.]

A BILL Relating to the administrative jurisdiction of certain public lands in the State of Oregon Be it enacted by the Senate and House of Representatives of the United States a America in Congress assembled, That the first section of the Act entitled “An Act relating to the revested Oregon and California Railroad and reconveyed Coos Bay Wagon Road grant lands situated in the State of Oregon", approved August 28, 1937, is hereby amended by adding at the end thereof the following new paragraph: "For the purposes of this Act, the authority of the Secretary of the Interior with respect to the administration of the revested Oregon and California Railroad grant lands shall be deemed to extend to, among other lands, all the unpatented lands in the odd-numbered sections included within the indemnity limits of the grant made to such railroad by the Act of July 25, 1866 (14 Stat. 239), as amended, and for which payment was made by the United States to such railroad or its successors in interest under the Act of June 9, 1916 (39 Stat. 218), except the portions of such unpatented lands which have been specifically placed under the jurisdiction of an executive department (other than the Department of the Interior) since June 9, 1916, by an Act of Congress."

Senator MURDOCK. Let the record show that Senator Hatch, chairman of the committee, is necessarily absent, and the acting chairman of the committee, Senator O'Mahoney, is absent by reason of illness,

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and it is on his request that the Senator from Utah, Senator Murdock, is acting chairman of the committee this morning.

We will be very happy now, Senator McNary, to hear you and any other witnesses that you desire to present.

Senator MCNARY. Mr. Chairman and members of the committee, the distinguished chairman has stated historically the situation with respect to this measure so far as its appearance in the Senate. I might add also that there was a companion bill introduced by my colleague in the House, Congressman Ellsworth, H. R. 1688, which is in every way identical.

I am going to forego the making of a statement touching on this subject matter, which is a matter of very great interest, I think, to the people of the State of Oregon, and be content by offering for the record a memorandum, to save the time of the committee, which I would like to have printed in the record.

Senator MURDOCK. Without objection, the memorandum submitted will be made a part of the record. (The memorandum is as follows:)

MEMORANDUM RE S. 275

The Oregon & California Railroad Co. was the beneficiary of a Federal land grant to aid in the building of a railroad northerly and southerly through western Oregon. The grant consisted of the odd sections of the unappropriated public domain for a distance of 20 miles on each side of the railroad, with a provision for indemnity selection within an additional 10-mile strip on each side in lieu of loss through prior appropriation within the limits of the original or place grant.

The railroad company violated the terms of the grant and Congress, under authority of a decision of the Supreme Court of the United States, revested in the United States all of the unsold portion of the grant, both that to which patent had already issued and that which was still unpatented but to which the railroad company was entitled to patent. This Revestment Act was passed in 1916, and is known as the Chamberlain-Ferris Act. The act placed administrative jurisdiction of the revested lands in the Department of the Interior, where it has since remained.

The grant lands had been taxed while the railroad owned them. The Revestment Act made provision for payments in lieu of taxes from the proceeds of the sale of the revested lands and timber. The provision was insufficient and, in 1926, Congress passed the Standfield Act, which guaranteed the equivalent of taxes to the counties. Under the provisions of this act the Government advanced the taxes and the deficit resulting was to be later made up from proceeds from the revested lands, all to be handled through a special fund, the "Oregon & California land-grant fund." There is still a deficit in this fund of over $8,000,000, to be made up from future proceeds from the lands. About one-half of this deficit was caused by the payment to the railroad company of over $4,000,000, at the rate of $2.50 per acre, less certain amounts already received.

A portion of the lands for which the railroad was paid by the Government was made up of unpatented lands within the indemnity limits, totaling around 472,000 acres; the Court held that these lands had been revested by the ChamberlainFerris Act and must be paid for like patented lands, and that was done. (Proceeds from these lands should certainly be used to repay the deficit caused by their revestment that is one of the things the enactment of S. 275 will accomplish.) The provisions of the Revestment Act, as amended by the Standfield Act, having proven unsatisfactory as a full solution to the problem caused by the grant-lands revestment, Congress, after comprehensive hearings, passed the act of August 28, 1937. This act provided a sustained yield management program for the revested timber lands, and for an annual payment to the counties, based upon a percentage of the annual proceeds from the lands. The act further provides for the repayment of the deficit in the Oregon & California land-grant fund in the Treasury from a portion of the proceeds of the revested lands. (Let us remember that the deficit was caused in part-over a million dollars-by the unpatented indemnity lands.)

After the enactment of the act of 1937 the Department of Agriculture, through the Forest Service, made the claim that the unpatented indemnity lands were not included, but were a part of certain national forests within whose boundaries they were located; the principal basis of this claim was the fact that the 1937 act did not specifically describe these lands, although other untenable claims were also advanced. The 1937 act included all revested lands "as are or may hereafter come under the jurisdiction of the Department of the Interior."

The question was submitted to the Attorney General for his opinion as to congressional intent with reference to the indemnity lands, where it is still pending.

The Attorney General has advised that he cannot render any opinion unless the two departments can agree upon all the facts; up to date no agreement has been reached. In any event, the Attorney General can give an opinion only as to his conception of what Congress intended to do. By enacting S. 275 Congress can itself declare that intent and settle the whole matter. That is the whole purpose of S. 275 to clarify the act of August 28, 1937.

The question arises: Were the unpatented indemnity lands intended to be included in the act of August 28, 1937? The answer is emphatically in the affirmative, for the several reasons that follow.

1. The unpatented indemnity lands were specifically inventoried when the 1937 act was being heard before the House Public Lands Committee, and were included in the total which was used in the affirmative committee report.

2. These lands were revested and placed under the jurisdiction of the Department of Interior by the Revestment Act; it was so held by the United States District Court of Oregon in 1925 (U. S. v. O. & C. R. R. Co., 8 Fed. 2d, 645.), when the court required the lands to be paid for the same as patented lands were; all the revested lands under the jurisdiction of the Department of the Interior were made subject to the 1937 act by its general terms.

3. These lands were responsible for over a million dollars of the deficit in the Oregon & California land-grant fund; existing law provides that the deficit shall be repaid from proceeds of the revested lands, on account of which it was createdthat includes these unpatented indemnity lands.

4. The land-grant counties will be gravely and adversely affected if the remaining lands are called on to pay a debt they didn't create. Equity as well as law favors the enactment of S. 275.

By enacting S. 275, and thus permitting these lands to remain as a part of the Oregon & California lands administered by the Interior Department, the United States will also benefit, as the Federal Treasury will be reimbursed far more quickly for the deficit herein before mentioned; the lands will be self-supporting as a part of the Oregon & California lands, whereas national forest lands are administered at a loss; they will be operated on a sustained yield basis and can be used to help in the establishment of sustained yield on at least an equal amount of privately owned timberland; the land grant counties will not be charged with their cost, without having their proceeds to offset that cost, as will be the case otherwise; and, finally, the long established policy of Congress with respect to these lands will be carried out, with no loss to the Government.

Senator MCNARY. When I spoke to Senator O'Mahoney some weeks ago about this hearing before the full committee I told him I hoped we could conclude within the 3 days allowed us-Thursday, Friday, and Saturday of this week. I regret the absence of members of the committee. I understand there are a number of absences on account of illness.

Mr. CHAIRMAN. I shall give you the personnel of the Oregon delegation. I have the list here:

County Judge E. L. Pope, county judge of Clackamas County, Oreg.

Judge Earl B. Day, member of the State tax commission and former county judge of Jackson County.

Judge Ervin L. Peterson, director of agriculture for the State of Oregon and former county judge of Coos County.

Guy Cordon, counsel for the Association of Oregon & California Land Grant Counties. They are 18 in number where this land is