The Birmingham age-herald., 1912-02-13
He Testifies Regarding the Lake Superior Ore
 Region
PRESENT ORE RATE IS CHEAPEST IN COUNTRY
Witness Predicts Still Lower Rate. Hill Bought Ore Properties AS an Individual--Not Party to
 the Present Lease

Hill, chairman of the board of the Great Northern railroad, told the Stanley steel trust Investigating committee today. a story of himself in the role of a philan- thropist to the stockholders of the rail- way company.
 Mr Hill told how he had bought prop critics for more than four million dollars, turned them over for that amount to the Lake Superior company, a s trustees for the railroad stockholders and presented the stockholders, with pro rata certificates for the increased valuo of the property which accumulated rapidly and amounted to millions.
 Questioned Regarding Leases
 The railroad magnate was questioned al length regarding the lease of these orc lands to the United States Steel cor poration for development, a lease whief the corporation recently decided to canee on January 1, 1915. Tn this land there are estimated to tbe about 50o.0oo000 tons of ore which the steel corporation values at sl ton.
 q wouldn't take q a ton for the ore, said Mr. Hill.
 The ore freight rate from the Lake Su- perior region to the Pittsburg district which the United States steel corporation recently reduced to so cents a ton, Mir Hill declared to be the cheapest in tlle country.
 And 1t will be still lower," said he "The next rate will be 50 cents.
 "Why did they cut the rate?" he was asked.
 why, I think the steel corporation juts got scared to death,' he replied. That's all there is to it.
 But, you get your royalty just the same?" asked MT. Young. And when the lease runs out. you've got the ore.
 Still Gets Royalty
 'Yes,' MT. Hin replied, what differ ence does 1t make. I'll have the ore, ant 1t doesnt go ont of fashion and tho frf risk is quite low"
 Representative Gardner asked the wit ness why he had turned over the proper ties to the Lake Superior company for the benefit of stockholders. MT Hill de- cared the trustee company reimbursed him for what he had paid and the in creased value was a gift to the Great Northern stockholders.
 "The trustees of the Lake Superior company paid over to me $4.ooo,ooo. with 3 per cent interest" said MT. Hill These properties immediately took on consider able additional value and could make money for the stockholders. There was nothing to conceal about 1t. Wherever saw I could make money for the stock holders that way I did it"
 Did the stockholders of the Great Northern railway pay anything to the Lake Superior company" asked MT Gardner.
 Philanthropic Corporation
 NO, their interests were a gift to them"
 "why did the stockholders get this gift?" asked Mir. Beall of Texas
 "I got back all had paid and the stock holders of the railroad got the benefit of the additional value," said MT. Hill. "If 1 could make money for myself, I could make it for the stockholders. I was in n measure dealing with myself. l bought the property to get control of the trans portation of the ore in the Lake Superior region Subsequent developments showed the property was worth vastly more than $4, GOO, 900.
 q bought the properties as an individ- ual." MT. Hill continued, "because, as n railroad company, I do not think the Great Northern would have the legal right to own and operate mines"
 'But you, as president, could own and operate mines and distribute the stock to the railroad stockholders?' asked Chair man Stanley
 "Yes, or give it to the poor said MT. Hill.
 You were a party to the lease between the Steel corporation and the Hill ore lands" MT. Stanley asked witness
 Not Party to Lease
 q was not d party to the lease" wit ness replied. "I arranged the prelimi- naries, but the terms were made by trus- tees of the property. J. NJ. Hill, l.. w. Hill. Edward Mitchell and NJ. Hill"
 What properties did you acquire on the Mesaba range?" Chairman Stanley asked.
 ''The first was property coming with the Duluth and Winnipeg. bankrupt railway running into Duluth and the su- perior region"
 How close did this road get to the Mesaba range?'
 within about 50 miles"
 "IJow did 1t happen the ore lands were thrown in with railroad that did not touch the ore lands?"
 "Parties interested in the road were also interested in the ore lands" witness replied. "In the purchase of the road the ore lands of the North Star company with it. or about % per cent of their stock"
 How much land was there?' asked Mir. Stanley.
 About 12,OO0 acres,' witnessed replied
 What part of the lands were turned over 10 the United States Steel corpora tion in 1862"
 ''I guess about 5000 acres.'
 Price of Ore
 "Whatever the Steel corporation got il paid s1 G5 for ore and transportation, did it not under that lease?"
 "Yes for the first year and cents and s mills per ton additional every succeed inx year." said MT. Hill. and that was for 49 per cent of metallic ore. The sys- tenn was graded
 MT. Hill explained more in detail the original purchase of the ore here. He said another man owned 25,O00 acres of land. This was lumber interest having con nection with his road.
 My son was anxious I should look the ground over up there" he continued. "He negotiated with the owners of the land and had an understanding that l be glver an opportunity to get the land if found
 
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