The Birmingham age-herald., 1910-01-26
GOVERNMENT WILL REAP
 PROFIT OF $1OO,OOO,OOO
Seattle Man Declares That His Offer Is Opposed By Lobby in Wash ington Which Is Working in
 lnterst of Canadians.


 already sufficiently excited situation over the Alaska coal lands, on the eve of the Ballinger-Pinchot investigation, which largely concerns that question John F. Baillaine of Seattle, said to be the largest individual operator Tn Alaska, made a proposition in writing to the Sem ate committee on territories, of which Senator Beveridge is chairman. offering to give royalty of 50 cents ton on coal mined, for & lease of 50oo acres of some of the choicest coal lands in Alaska, in the Katalla and Matnuska districts. Such a royalty would net the government, he claims, amounts as high as s20Oo.oo0 per 100 acres.
 This proposal contemplated a radical departure from past practices in the gov ernment's disposal of the government coal lands, and it comes avowedly to do battle with any proposition embodied in a bill which has been prepared, but not yet introduced, designed to permit the sale or lease of such lands at rate of $lo per acre.
 It Is said that the general features of the plan have the approval of officials high in the administration and of infiu- ential members of both houses of Con- gress, including some of the prominent insurgents and Delegate Wickersham of Alaska.
 Immense Bond Offered.
 MT. Baillaine. in his letter to Senator Beyeridge, offers to enter into bond of s1,O00,000 with the government for the performance of his part of the agree ment, which he proposes ard makes the charge that ''other interests have now at work in Washington a lobby, headed by former United States senator in support of the bill referred to above, under whose provisions, he declares, the government would extend an uncondi- tional guarantee to ra1iroac or rail- roads which these interests purpose to build in Alaska, and would virtually do- nate to them at s10 per acre one or more tracts of 5000 acres each to be selected by them.
 MT. Baillaine asks Congress to authorize a head of g. department-to De designated in the legislation--to enter into lease with A coal company to D. organized by him. for 5000 acres of .sMatanuska coal land, under all the provisions Tor resu- lation and against monopolistic controi of prices, as stated in the bill recently introduced by Senator Nelson in conform ity with the recommendations of Secre- tary Ballinger's annual report.
 Royalty To Be Paid.
 This coal company would pay the United States and Alaska royalty of Ocents ton for the coal as mined. Mr. Baillnger states in his proposal that veins averaging a total thickness of 20 feet would yield according to standard measurements total in excess of 10O,o00, 600 tons from the 5000 acres making a royalty of S50.U0o,O00 for this comparatively small area He asks the government to provide as a COR dition on it's part that no other coal lana in Alaska shall be leased on payment Of a smaller royalty, and also to agree that at least half of the governments snppiy of coal shall be obtained from this com- pany or from a naval coal reserve which the government may establish and itself operate in the Matanuska district, ship ping the product to Seward, at rates to be fixed by the interstate commerce com mission over a railroad the plans for the construction of which he outlined.
 So much as may he needed for tine pay ment of the royalty on the 5000 acres, the Baillaine proposition stipulates, Is to con- stttute a fund for the guarantee of the payment of the interest on the bonds of tie railroad company, which MT. Baillaine agrees shall be organized upon lines ap proved by the head of the department to be designated by Congress. The railroad company is to enter into contract with The government for the completion of the proposed 1000 miles of road within a specf- fled time. and to be under the control and regulation of the interstate commerce commission
 Charge Against Lobby.
 MT Baillaine alleges that the Canadian interests which owned a majority of the stock of partially completed railroad from Seward recently put it through a foreclosure reorganization on plan that wiped out all American investments in the road. while protecting all Canadian in- vestments in it. He further charges that the lobby which he describes as asking for an outright guarantee of interest on bends and the donation of 5000 acres of ccal land as virtual gift is working in the interest of these Canadians but in conjunction with group of American capitalists who are, he declares, attempt ing by the same bill to get control of the Katalla coal in another part of Alaska.
 MT. Baillaine tonight quoted the United States geological survey as stating in one of it's recent reports that there are 16000,- 100000 tons of coal in sight in the known coal areas of Alaska, and probably at least as much more in regions yet unex- plored. and he pointed out that the leas- ing of these areas on royalty basis such as he was offering for an area of only 5000 acres would ultimately bring to the gov ernment net revenue from that source 1tv,u ny n